Thread by @JackNiewold

TRANSPARENCY TIME:

I make mistakes in my crypto investing at many times a day.

Here is a list of my biggest regrets in crypto investing: the mistakes that have cost me the most money.

🧵👇

1. Anchor Bias

Like a lot of you, I’ve had a round-number portfolio goal in mind for a while.

In December, I got within a few percent, then it fell apart.

Instead of getting back to sound principles and high-conviction positions or stable yields, I went full degen.

This error is called anchor bias, where we focus on a specific reference point instead of reality.

I went to small caps and risk-on plays to ‘make it up’ and then got more rekt than I’d like to admit.

The only number that matters is the current one: everything else is made up.

I see anchor bias in play where people hold onto a crypto until it gets back up above a previous all time high.

It’s the wrong approach: the best risk-reward play has nothing to do with where you’ve previously lost or made money.

Don’t get married to your bags.

2. Stack Sats

I write about alts but the only cryptos that I have true multi-decade conviction in are BTC and ETH.

I should’ve taken more profits back to these blue chips to protect my holdings in high-conviction plays that I can feel good holding through bear markets.

Instead, I took profits out to a wider and wider portfolio of alts, leading to a bucket of investments that was difficult and time consuming to handle.

Have your core portfolio, then your play money. Don’t let them switch places. And stack high-conviction bets ALWAYS.

3. Intellectual Laziness

I’ve missed out on airdrops, narratives, and huge gains because I’m too lazy to do some light reading.

Crypto markets are inefficient, huge alpha is available to those willing to some research.

I’d rather have Medium than Twitter: the alpha is typically not where the herd is.

Making money takes time, effort, and work.

4. Being overly focused on Due Diligence

Crypto Markets are mimetic, reflexive, and momentum-driven. Being able to ape is an advantage.

Just make sure you follow up later with proper research or you’ll get rekt.

5. Not Taking Profit

It’s nearly impossible to be rational in the face of hopium, greed, and green candles.

Get your starting investment out after you’ve done multiples, at least. Then you’re playing with house money.

It will retrace, I promise.

6. Dry Powder

Protect your USD: it is your fuel, without it you will not go very far.

It’s tempting to get overexposed.

Poker players only go all-in in extremely favorable circumstances, you should be the same way.

Make income in USD, hold dollars, hold stablecoins.

I try to hold myself to these principles but I’m sure I’ll continue to mess up and due stupid stuff.

Our goal is to put the odds in our favor: over time, execute on this and your portfolio will grow.

Make mistakes, but learn from them and get back up.

If you liked this thread, you’d love my newsletter on no-BS crypto investing, I’ve got it linked below.

And give me a follow for threads like this one: @jackniewold

Cryptopragmatist.com/sign-up/

One last thing: if you’d like, you can do me a favor by RTing/favoriting the first tweet, linked below:

Thanks!

https://twitter.com/jackniewold/status/1497680709191974915