Top Ten Rules of Crypto

in LeoFinance2 months ago

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The other day @onealfa was listing off some rules for crypto in the LEO Discord. Apparently rule #2 was HODL. So of course I decided I would troll this process and just start making up random rules like "Rule #1 is don't talk about Rule #2" like it's Fight Club and whatnot.

But in the end I was able to take it seriously and actually flush out a top ten set of what I would consider some key advice for users entering the space.

Rule #1: Community is key.

People get mad when coins like Litecoin and Doge spike. Hell look at Doge today. Up to 25 cents when the normal price was well under a penny a few months ago. Why do they get mad? Because those projects, "Don't have fundamentals." But for the most part lets be honest: it's just because their token isn't mooning and they are jealous tribalist whiners.

Spoiler alert: currencies don't need fundamentals; they need users. That is all. We assume that networks with good fundamentals will get all the users. That is false. That is like saying no one likes the Raiders because they never win the Super Bowl. Raiders fans are some of the most diehard fanatics out there. Wen Raiders token? They'd pump it to the moon.

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Rule #2: HODL!

90% of gamblers lose money on average. The easiest way to make money in crypto is to pick solid projects and simply hold the tokens without trying to trade them back and forth. It's not about timing the market; it's about time in the market.

Not only is this a better & safer strategy for 90% of all users, it's also a less stressful solution. Rather than having to constantly worry about buying and selling you don't even have to look at the price. Just come back to it later and hope for the best, as this strategy usually works out.

Rule #3: Trust No One!

The entire point of crypto is to be your own bank and maintain responsibility of your own assets personally. Not your keys, not your crypto. Leaving significant amounts of capital on centralized exchanges is just asking for trouble.

That being said hot-wallets, hardware-wallets, and even cold-wallets have their pitfalls. Employ decentralization and have a good spread of assets in a lot of different places so if one form of security fails you won't lose it all. Decentralization is key.

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Rule #4: Test, Verify, and Backup.

The worst thing you could possibly do in crypto is have such good security that even you are locked out of your own vault. Crypto is complex and if you mess up your money can just vanish forever. Lose your keys? Gone forever. Send money to the wrong address? Gone forever. Get hacked? Bye Bye.

New users should always send test transactions to make sure what they are doing is actually going to work. Unfortunately this becomes prohibitively expensive on the biggest networks that have the highest fees like BTC and ETH.

Whenever making a new wallet don't simply trust that you've done everything right. Not only do you have to send money to a new wallet, but you also have to ensure you actually control the wallet you created. Once everything is verified, creating at least one extra backup of the private keys is absolutely essential to maintain proper security. Ask yourself: if my house burns down... how much crypto do I lose?

Rule #5: DCA

Perhaps your crypto has mooned and you'd like to take some profits. What do you do? I'll tell you what you don't do: sell everything all at once and hope you perfectly timed the top.

Similar to HODL strategy, Dollar Cost Averaging is the superior strategy used to limit volatility and risk resulting from unknown external forces. If you think you want to sell some of your stack: sell 5% and wait a few days or even a week before making another decision on the matter.

If you ignore these warnings you're almost sure to fall into the trap of constantly second guessing yourself. You move all out and your coin goes up even 5% and you could panic and move all back in again. Before you know it the market has crashed and you've made a dozen foolish moves that were easily avoidable. This market knows how to get inside your head and fleece the newbies: don't be one of them.

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Rule #6: There is no silver bullet.

There is no Bitcoin killer; there is no Ethereum killer. These are the stories antiquated venture capitalists tell their children. You can't patent open source code. You can't buy communities. You can't solve all the problems with a single network. Get over it Maximalists: Bitcoin is extremely niche (secure & stable, but also slow & expensive).

There isn't going to be one blockchain to rule them all, so you might as well branch out and get involved with projects you're personally excited about and actually use. If you don't know what to pick or if a newbie asks you for help: The Answer Is Bitcoin. Every time. Don't send a newbie down some rabbit hole farming some new experimental DeFi token: that's just mean, and highly likely to blow up in their face and cause salty feelings. Bitcoin is the anchor. Start there first and branch out after.

Rule #7: You get what you pay for.

There's a reason why Bitcoin and Ethereum transactions are so expensive. These are the most decentralized networks in the world with the most inefficient and expensive redundancies. When it comes to security: you get what you pay for. Sure, thousands of users will migrate to Binance Smart Chain because fees are so much cheaper: that doesn't mean they aren't going to get wrecked.

Or maybe they won't! Even CUB is on BSC. We hope for the best but prepare for the worst. This is one of the reasons I'm so bullish on Hive. We have fairly good security for a chain with "free" transaction costs. Our security is better than BSC: I guarantee it. Also we aren't full of rugpull Defi scam coins (yet). Again, every network has tradeoffs, and no network can do everything.

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Rule #8: If its too good to be true...

You're either a genius or a sucker. Truth be told it has nothing to do with being smart. Lucky people get called geniuses all the time after the fact. This is gambling. These lifeboats are rickety.

The problem with projects that are too good to be true is that the dev teams make it sound like the product will be easy to program and they theorycraft it all out, only for nothing to get done or no one to adopt the platform. That and the endless exit-scam culture we've been witnessing lately: dear god.

When it really comes down to it: investing in the top ten by market cap (especially Bitcoin) is going to be the best bet 90% of the time. "Only" making x2 per year with BTC might be "boring", but let's be honest: you're probably just being overly greedy.

I never speculate on networks that I don't use anymore. Also, when I feel like the bear market has started, I will heavily retreat back into BTC with the rest of the rest of the trading bots. In general, alts can only vastly outperform Bitcoin for a few months every four years.

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Rule #9: Learn the tech.

Crypto is complicated, but it's worth it. We are entering into a very strange time period in human history. This is a digital age. Knowledge is power. Data is coveted and monetized.

We should never stop learning. A shark that stops moving forward: dies. In this same vein, we should remember how far we've come and how alien this all is to "the normies". Teaching others is a great way to retain information for ourselves permanently while adding value to the cryptoverse.

Rule #10: A journey: not a destination.

Evolution does not end. Life goes on indefinitely, regardless of the individual. The environment undergoes constant change and we must adapt to our rapidly changing conditions.

Life is a game, and money is the scoreboard. However, with crypto your money is also your reputation: Ney, your very lifeforce. In decentralized systems such as these, there is no end-game. No matter how much money you have, building more value for yourself gifts additional value to everyone else in the network and furthers our own reputation. This is nothing like the legacy economy where billionaires simply try to scoop up every last bit of value for themselves. No matter how much they earn we gain none of the benefit. With crypto the entire script gets flipped.

We're transitioning from zero-sum game theory and cutthroat capitalism to synergistic cooperative systems without limits. A star is being forged: and at the heart of that star will pour fourth seemingly infinite power. You and I will have front row seats to watch as we hit critical mass.

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Some other rules that didn't make the cut:

  • Stop asking wen
  • Hedge your bets
  • Make connections
  • Stop speculating and lay down roots.
  • Shiny new things tarnish quickly.
  • Don't invest more than you can afford.
  • Not not financial advice.

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Too many rules. Doge proved you don't need any rules in crypto. :)

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number go up


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Wen Alpha Centuri?

Merely mooning is SO 2017.

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I hear Hive can do the Kessel run in less than 12 parsecs.

Very smart words with wisdom that I'm going to try to live by thank you very much for sharing these very important gems.

I really appreciate the knowledge that you are trying to impart and I'm squatting on all of my cryptocurrency like a dragon.

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Trogdor! Miss those days.

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It's on fire!!!

Some rules won't be changed, they are simple and logical- crypto rules may be followed it!

Excellent set of rules. Glad you avoided the need to troll.

A very good list. A great primer for people who are newer to crypto and a terrific reminder for those of us who are around a while.

Stop asking wen

I wish this made the list; I am sure so is Khal.

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Such a great and useful post, @edicted.

Very true, there's no way that those coins will be downed all of sudden. They're not like some mythical creatures that have some weaknesses.

Well, it's money so we shouldn't trust anyone. People change because of money after all.

HODL? I don't think in my own opinion. We're holding it because we're waiting for it to have valuable value. If the time comes you need to spend it I think it's just right not to hodl it.

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Hive, CUB, Leo moon wen? 🤣

I enjoy this chain and I invest in it, but still I'm like What the fark! Despite not actually really wanting everything to moon. If it did I wouldn't be able to buy in on a regular basis.

We will get there eventually. Plus we have one of the best communities with awesome discussions.

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Nice set of rules.

To me, learning the tech and doing a lot of testing has been key. If I'm doing something for the first time, no matter how straightforward it seems to be, I always read every instruction twice, plan every step ahead and do a test transaction first to make sure everything is working as it should.

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Good job with these @edicted

I particularly like number 9, Learn the Tech and the second part teach others:

Teaching others is a great way to retain information for ourselves permanently while adding value to the cryptoverse.

I personally have spent three years learning by writing and attempting to teach others what I learned. To be honest everything I wrote wasn't correct, but I learned from writing it and from rewriting it! LOL !

I also like number ten: Life is a journey, not a goal or achievement, we must keep our eyes and ears open to both learn and enjoy the journey.
We shold be life long learners and we should enjoy ourselves. We spend to much time worrying or being pretentious...
We need to learn to be content with ourselves and enjoy our journey to be the best version of who we are for ourselves.

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Thanks alot for sharing, It so informative for an amateur like me. 💕💕

Good. Joob ;))

i agree ive been hodling and for the most part now more in with blockchain then ever i like to trade too but for the most part blockchain is where it's at

Now we talking.

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Thanks for this post. A lot of good tips here. I especially like rules #4, 5 and 9.

Don't invest more than you can afford.

I think this is missed due to the bull markets going on. But the rest of the rules are definitely great. Rule 9 was especially good though. They should just come over to LeoFinance since most of the things they need to know are here anyways.

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I was really pleased reading this article. I've already commented with few people how we need more information and stuff like this. Also, talking about Hive itself, newbies often find themselves lost in the UI and all the information that is provided to them. This kind of "golden" articles really lighten up the way for people and if nothing, you really helped me and answered few questions of mine.

Also, as @geekgirl said, there's no specific rules, the ones you mentioned, can be used in 90% of cases. This whole crypto market is still unexplored to the fullest. We should appreciate the moment we're here, in 10 years people who were talking against crypto will most likely regret it. As you said, knowledge is power, and we're constantly learning in here. Great, amazing community!

The best post I've seen in a while! Congrats!

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Gotta say the horribly wrong fight club reference almost put me off reading the rest ;-)

But glad it did make up for it. Number 5 is why I actually like the way powering up and especially down works, it forces you to think about your actions before setting things in motion. Seen quite a bit of criticism on it, money's gotta flow and all that but for someone investing for the long run it helps to stay the course.

Also

Not not financial advice.

We can hold you accountable for any loss?

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I learned a lot from your article. All the rules sound reasonable. Thank you!

That's a fairly solid set of rules and good advice for anybody venturing into the crypto world. Finding good projects and holding long term will be the safest bet for a lot of people. Maybe not the most profitable but the most likely chance of profit.

To complex for average billy.

They compare to often apples with tomato :)

Rules help to stay in course.
#doge is something else. At least it will get more folks to
embrace crypto.
In a way slowly but surely.
Well put.

!BEER

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Hey @edicted, here is a little bit of BEER from @pouchon for you. Enjoy it!

Learn how to earn FREE BEER each day by staking your BEER.

I recently bought $1 worth of every coin listed in the top 30.

And the shocking thing is that it's actually LIVE.
https://www.theta.tv/video/vid55m5adnx551snx2h

Gracias por las criptomonedas aprendemos, crecemos todos los días y nos volvemos nuestros propios jefes

I love rule 6 and rule 8, I always try to remember them every time I start my day in leofinance and cubdefi.

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"It's not about timing the market; it's about time in the market."

I freaking love this!

We the people give currency value. And the central banks of the world have been using this “power” for far too long. Crypto is restoring this power into the rightful hands..

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Banks do not want to loose their bread , with cryptocurrency, banks will not be needed as the main financial services, that's why banks always get along with authorities to force policies that make them profit.

Eventually banks will integrate the blockchain for survival.

Ooh wee what a comment trail! Congrats on the reward here. I can't pick out one favorite but each of them made me a little more aware. Thanks!

A great primer for people who are newer to crypto!!!

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"Whenever making a new wallet don't simply trust that you've done everything right."

So true. Learned it the hard way!

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A concise and informative post, many thanks. Regarding rule two and those gamblers it reminded me of a quote attributed to Einstein that you can never win at roulette unless you rob the casino.

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