My first trades came when I began listening to podcasts describing the Ethereum platform back in November of 2015.
I had purchased some Bitcoin prior to this in June when it was around $200(!) and began to expand my research into the rest of the cryptosphere.
That was when I stumbled on Ethereum and began to recognize the writing on the wall of what could be.
Given that my imagination runs faster than my abilities to actually build, code, or simply remember the idea I had before the one I just had, you can imagine the rate at which my mind was swirling around the realm of the possible.
Naturally, the next step was to get in on this game. Poloniex was my first stop, since it was the first altcoin-centric crypto exchanges I had heard of. After a simple account creation process, I transferred (very carefully mind you, since this transaction process was rather terrifying at first) a few of my bitcoins into my Poloniex wallet and began watching the Ethereum charts to find a good entry point.
If I recall, I initially purchased 3,000(!!!!!) or so ETH tokens when it was sitting around $1. A few weeks later, I began to watch it start to climb until it hit a ceiling of 0.003 ETH/BTC. After agonizing for DAYS over whether it would break out and listening to the (now-defunct) TrollBox full of FUD(Fear Uncertainty Doubt) and hype, I wasn't sure what to do. I sold a few of the ETH at a loss and waited some more.
Then one day... it happened.
It broke the 30k satoshi barrier and began climbing like a rocket. It was like a giant whale was just biting up huge orders of the sell book and making the lives of all of those who had been driving the price down through shorts absolutely miserable.
One particularly snarky bear whale (I won't mention his name since he hadn't been back to Poloniex since) spent his entire days mocking the value proposition of the Ethereum project, how it would fail, and how he had millions of dollars worth of bitcoin in reserve to keep the price crushed under his weight.
The bull whales had different ideas in mind. Within a week or two, his stops were bypassed, his shorts were liquidated, and his portfolio was essentially wiped out.
This scared the hell out of me.
This was my first glimpse into the world of crypto trading, and I’ve learned some simple lessons from that point that I think could be of service to some of the many n00bs coming in due to the rise in interest on the topic…. So here we go!
Do your damn homework!
Never invest in an asset without doing your due diligence. If someone tells you that a token is going to be the next big thing, ask them to back that claim up with research and learn what the token does and how its underlying technology works. If it doesn’t have a legitimate value proposition for a broader market need that solves problems faced by industries with access to capital, be wary. Focus on the bigger players first, then learn what new market entrants may look like.
Margin Trading WILL Chew You Up
I’ve had good days on margin and I’ve had very bad days on margin. After two years in this game, I’ve finally come to the conclusion it’s simply not worth it with the algorithms out there designed by people far more brilliant than myself.
Understand the technology and fundamentals of the coins you invest in
If you believe in the technology fundamentals, don’t sell for a loss unless absolutely necessary (or if a catastrophic failure happens with the tech -- see the DAO). Everyone in the market wants to shake you out of your position so that you sell lower than you bought, and buy high than you sold. Don’t be one of those folk.
Have Limits
It’s better to sell at a small loss than to hold until your portfolio is drained completely due to false hope. The goal should be to fight another day.
Separate Yourself from the Rat Race
Spending too much time staring at the charts will either degrade your faculties, make you emotional, make your overconfident in your abilities to read the market (or more likely, a combination of all of the above).
Now please, please bear in mind -- I am NOT an expert at this. I’m a novice with some abilities of strategic and tactical analysis offering my observations of one of the most complex ecosystems I’ve ever encountered, short of actual warfare with live rounds being fired.
If you’re reading this anywhere near the time of this publication, you are quite literally on the leading edge of a technological revolution. The cryptocurrency field requires a solid understanding of technology, economics, market forces, politics, and human emotion.
Call it -- Cryptonomics. If no one else has, I'm coining this first on the Steem Blockchain for all of history to see!
As a collective community of global crypto-geeks, we are carving out a new frontier of market dynamics and very few people understand what’s happening out in these hinterlands. Even fewer could begin to coherently explain it. Learn your skills now before everyone else, and be a very valuable asset in the near future.
Welcome to the party.
These are some well thought out lessons, the kind i have had to learn by my own mistakes.
The sky is the limit with currencies, and i don't mean the value in cash, but the value they add to the human experience.
I want to say they will be the next big thing since the internet.
brilliant observation. very well put. completely agree on the next big thing as well. I was only 8 in '92, but it sounds like we're in the equivalent of that era with crypto. Thanks for reading!
Well thought out, thanks for sharing..
I've seen them all too ;)
I will not day trade crypto anymore either... to f*cking stressful!
Chew you up completely, better buy and hold steady/descent crypto's!
Blockchain has a bright future
stressful is absolutely the right word for it :P
Grey hair at 24 stressful :P
I got into crypto forreal when ETH was like $40 and thankfully all the mistakes I've made haven't been too gruesome and I've always been able to fight another day. Made some nice gains too :). Great article though, a lot of people seem to completely forget about the technology/fundamentals when they start hearing the troll boxes ringing and they stare at the sea of red. Weak hands everywhere, even I've been guilty of it before.
Don't get me started on the trollbox :D I wrote this a while back when the PoloTrollbox was still thriving.
I sharpened my teeth in there though. Challenged my thinking on what exactly makes crypto valuable and how to actually explain it in person and text. Great post! Glad you're in the game
thanks for sharing!! I'm new to crypto currencies and appreciate your insight!
Vast expirience and wise conclusions. It is nice to see people with such a solid aproach . Thanks a lot
Nice post wish I had done that!
Thanks for all the insight hopefully ill avoid some of those mistakes
unfortunately, some of the best lessons come from actually making them hah. glad you liked it!
I will find out soon enough
For now I just put some money I can loose in coins to get my feet wet.
Due diligence studying in anything you plan to invest in is necessary, This post should hit home for all newbie learning about crypto currency, very nice share!
indeed! i remember the 2 week 'fugue state' after discovering what bitcoin was and how it worked. made recognizing the value of Ether, Steem, Iconomi, and BitShares that much easier for me.
Thanks for sharing your your story, how you manage to cryptocurrency trading. I'm quite new to the scene and hopefully i will not miss upcoming opportunists.
Lastly thanks for inviting to the party :)
Thank you for sharing. It's always nice to read educational posts about trading.
And remind yourself about mistakes you've made in the past.
Or you will learn them again the hard way - by losing more profit hehe!
one hell of a tuition :)
Good advises!
Awesome post, cryptonomics is still very much in the experimental phase and the furture is exciting.
I am going to quote something I head from a guy not into trading:
"Starting is the first step towards losing"
i would agree with that.. actively trading is far too demanding and emotionally straining. buy and hold is now my viewpoint after taking my lumps. but cant be rewarded without some risk!
Yepp, HODL is a very reasonable strategy.
And no reward without risk (or effort) always holds true!
I think most would argue that only holding crypto itself is already taking on tremendous risk.
Sounds like you made a bundle with Ethereum; it was good to me too!
if i were smarter, i would have made A LOT more :)
Good advice, will do..
Day traders be craaaaazy
What a great post. i use to trade forex and margins can chew you up! Gave you a follow.
Thanks! just thinking about margin makes me sad on the insides
very well-written and informative
Excellent. To think i had this idea and just never wrote it down.
thanks for the post mate...quiet helpfull
great post! thx mate!
following+upvoted+resteemed