Hey Degen Fren,
I'm going to share with you some of my investing philosophy.
1. Find the Balance Between Risk vs. Reward
It will take years for BTC to 10x. But finding a small cap gem can 10x within a few months.
I'm not interested in the next DogeElonRocket Coin.
I want to invest in the next Solana or Avax (and take profits along the way)
This is how you can make life-changing gains.
It also requires understanding where we're at in the market. If you're in a bear market, then it makes more sense to be in bluechips & stablecoins.
It's a dance.
2. The Most Profitable Strategy is to Understand the Meta Game
The "meta" is the most dominant strategy at any given moment.
Let's use basketball as an example. Teams use to build around dominant centers like Shaq.
Today's meta in the NBA is different.
It's all about building a team around players who can shoot 3 pointers.
Using the meta-strategy means a higher percentage of winning. That's why the Golden State Warriors are so dominant.
This concept applies to Crypto too.
Here are some examples of different Metagames in 2021:
- The release of OlympusDao and its forks
- The rise of Alt Layer 1's such as Solana, Luna, Avalanche
- DeFi 2.0 protocols such as Abracadabra and Tokemak
- The Curve Wars
Sticking to DeFi 1.0 Protocols (Uniswap, Compound, PancakeSwap) in 2021 would've been horrible.
They all underperformed compared to DeFi 2.0 protocols.
You would've missed out on so much profit.
The most profitable strategy is figuring out what the meta is, and being early to it. That's how this newsletter can help you.
3. You Need to Develop Tunnel Vision
I've never bought an NFT before.
I don't know what's happening with metaverse projects like Decentraland or the Sandbox.
Some of those projects will 100x. I'm ok missing out on them.
You know why? It's because I spend hours each day studying DeFi and only DeFi.
The space has become too big for a single person to be an expert at everything. If I were to try and cover everything in Crypto, then you're going to get watered-down advice.
Focus is how you get an edge.
4. Managing Risks is How You Win
Newer projects are riskier. It comes with the territory.
But don't confuse me for a degenerate gambler.
I'm always thinking about risk management and how to protect my downside.
- I hold safer coins such as ETH, AVAX, and stable coins as a part of my portfolio.
- I yield farm with stable coins
- I even own Vanguard index funds to hedge against Crypto
I always take profits no matter how bullish I am.
I went through the 2018 Crypto winter and saw my portfolio go down by 90%.
There will be more dips and bear markets.
We have to position ourselves to survive.
5. Multidisciplinary Thinking
Thinking in 1st principles will make you a better investor
That means learning all the fundamental blocks of Cryptocurrency.
This includes macroeconomics, cryptography, game theory, marketing, tokenomics and more.
And I'm open minded to learning across different fields.
You can learn better bankroll management from Poker players. You can learn how to become a better investor from legendary stock traders like Paul Tudor Jones.
Don't limit yourself to only studying other Crypto guys.
I have more that I can share with you overtime.
This should give you a better idea of my investing style.
Talk soon,
The DeFi Edge
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