9 bad lessons the crypto bull market is teaching us

With the crypto currency markets experiencing unprecedented growth, the market has favoured the risk-takers rather than the conservative traders. New investors, whose sole exposure to investment has been this bull-market for cryptos, find themselves being given questionable advice by others who were lucky enough to time their entry into the crypto market right. Bull runs tend to be forgiving.

Here are the 9 bad lessons that prudent crypto traders must be mindful of.

1. Making money is easy and everybody can do it

If everybody can make easy money, soon nobody will. People who are already planning their retirement based on humble investments in cryptocurrencies must realise that this cannot go on forever. The present bull run will end sometime. Those taking out mortgages on their homes to invest in the crypto-market might just find themselves on the street.

2. 40x returns are normal

They aren’t. Please take out your original investments as soon as you can, and play with your crypto-gains if you so much want to. That way you limit your downside.

3. Buy the rumour, sell the news

This is the surest sign of a market running on speculation – an inefficient market. If you are buying based on rumours, chances are that you are being manipulated.

4. More exchanges = higher price

Price is based on value. In an efficient setup, price is unaffected by the number of exchanges it trades on. More exchanges should only mean more liquidity and more stability, not higher price.

5. It is acceptable to take part in coordinated pumps

This market has desensitised us to price manipulation. New investors are accepting of obvious price pumps as long as they benefit from it. Even worse is when investors are willing to join pump groups and collude to drive up/down the price of tokens. We must all remember that when we sell an inflated token/currency, we are dumping our manipulated investments onto some unsuspecting person.

6. You haven’t lost any money if you haven’t sold

This is the surest way to lose money when the market crashes.

7. 10x jumps are because people are discovering value

No. If you knew something is a sleeper currency, then chances are that the big investors did too. If something moves up it’s because there is a change in its fundamentals, or because it is being manipulated

8. Nobel prize winners who don’t believe in crypto are ancient relics

Chances are that they are not. I would listen to what they have to say, even if it goes against what I want to hear them saying.

9. People care about technical details like ASIC resistance

They don’t. Most people are in this to make money. They would happily embrace any system if they stood to gain from it.