Where Most Crypto Investors Fail

"Get rich or die trying" is one of the famous quotes of 50 CENT, namely the title of one of his all time hits and albums and although the rapper is probably not the most profound or wise person in the world, there's a grain of truth in his saying. I doubt there's less that 95% of the world's inhabitants that wouldn't like to be rich.

As Ramakrishna, one famous Indian sage once said, the two most powerful urges and society movers are money and sex. I'd add power to the equation, but for the sake of the article's theme, lets stick with the money and take a look for a bit at the crypto markets participants and why I believe some will make insane revenues on their investments and some won't.

It is well known that we're divided in two large categories as investors, the smart and the dumb money. The way I see it the smart money are folks like Michael Saylor, Pompliano, and why not our own @onealfa. Such types of investors have entered crypto for quite some time and have proven to have done that based on a deep understanding of such assets, and the tech and world recognized value fueling the value of cryptocurrencies.

Dumb money are usually individuals that hear about crypto for the first time from a friend or acquittance, or read about it on twitter, facebook or any other social media app and decide to invest in such assets mostly based on emotions. Nothing wrong about that :), it's just that imo their speed of reaction is too fast for their knowledge level.

Jumping on a type of assets class without any basic due diligence is risky and will definitely lead to actually losing money rather than making any dime. "But sir, isn't crypto a good way of making money?" Yes it is but not for anyone...

I'll give you a real life example of how the psychology of the markets works and why dumb money(where most of the retail fits in) are actually loosing money in crypto. A few weeks ago when the crypto markets were still well in red I got a telegram message from a friend of mine asking me how can he buy himself DOGE. My reaction was: why DOGE?

He said to me that he believe that thing is going to explode. That's when I actually thought for a second that we might be near the peak. We weren't actually quite there, but it seems we've just hit a local top, had a consolidation period and now we're on our way back up. He didn't buy shit by the way, he wanted me to buy crypto for him and store it on my wallet, which I disagreed and that was about it...

The idea is that at that time when he asked about DOGE, the mother of all shitcoins was valued at around $0.60. It had a correction way down to $0.30 but no sign of interest from my friend. Dumb money, aka this friend of mine and other existent examples similar to him, don't buy during dips, don't enter the market when there's blood on the street or when these assets are scarce in terms of world recognition.

They are crowds and mass followers. They need to have recognition of the world to have enough confidence into buying crypto or any other type of assets. Much of the crypto markets participants are nothing more than lottery tickets buyers. They want to get rich, they think they're onto something, put some money on all sort of shitcoins and in 99% of the cases they either loose the money by leverage trading or exit the market with quite some bruises on their wallets.

Getting rich or die trying is one thing and buying lottery tickets is a whole different one. Unfortunately much of us are more into lotteries than working their ways to richness. Crypto imo is probably one of the very few ways of getting quite rich in relatively short time for the past decade. A matter of fact you can harness a small fortune in less than four years.

Most of the dumb money(or the so called retail investors) don't want to make the sacrifices, take the risks & do the work to make it happen for themselves. They look at the the ones who made it, wish to replicate their success but fail at learning the path to achieving that. Nothing ever worth fighting/working for has been achieved over night, and no lottery winner has ever managed to preserve that luckily earned fortune.

Getting rich is one thing and buying lottery tickets is another. My gut feeling tells me there's gonna be plenty of lottery tickets buyers right near the peak of this bull cycle. Pretty much as in every cycle.

Thanks for attention,
Adrian

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