This article comes fromMediumThis article comes from
, the original author: Alex Roan, compiled by Odaily translator Katie Ku.
“I’m very excited right now that the price won’t be as low as it was a few months ago. The more I analyze the current trend, the more certain I am about the future direction of Bitcoin. The news keeps talking about institutional investment. In my opinion, people have begun to wake up and start to enter the Bitcoin circle, and a token supply shock battle is about to start. The past halving events will not be mentioned, after all, there is no final pricing after that.”
The above paragraph of confident words is my mentality in 2017.
If you have just entered the currency circle and started buying in the past two years, now is the time you should start (January 2021). Do a Google search and youll see whats happened in the years since the 2017 crypto boom.But now is different,
We will not see new lows again.
There are a few words circulating in the recent bull run that do reflect the current state of each crypto asset. A large amount of capital inflow is the proof of the awakening of various potential tokens, and how long the price can be maintained is the best proof, which is why the price cannot predict its decline as it predicts its rise.
I paid dearly for those words three years ago.
Then the price did reach $20,000, there has been so much price movement in the past, the only thing that matters is that we see $3,000 again.
secondary title
In order to seize the right opportunity to enter the market, I monitor and collect relevant information in real time
The above sentence was recently heard from a good friend who was brought into the currency circle by me not long ago. After his initial taunting and annoyance towards the crypto world, I realized that this is like how Ive been in crypto since 2017, and I cant be mad at him for it.
In June 2019, the price of Bitcoin began to show some signs of recovery. At that time, friends around me began to ask me about Bitcoin, how it works and how to hold it. I explained Bitcoins value proposition, a simple technical explanation and a simple overview of Bitcoins development over the past few years. He was intrigued and bought it the same day for the same reason as me and everyone else in the crypto world - to make money.
Unfortunately, our conversation took place at a time when the price of Bitcoin was around $12,000, a relatively high price compared to previous years. Soon, the price began to retreat, and continued to slump until mid-2020. During a year where we rarely talked about Bitcoin, by anyones standards at the time, he ran into an unlucky short-term investment and lost half his money. Despite this, he chose to continue to hold the currency, put it in the back of his mind, and said nothing about investing in Bitcoin.
The time has come to 2020, the new crown virus has plunged the whole world into a dead silence, and the DeFi summer boom is riding the wind and waves, and people are turning their attention to Bitcoin again as an option to hedge against inflation. The price of Bitcoin also started to climb to $12,000 which my friend had just bought at the time and stayed there for a while. Then it rose to around fifteen thousand. The market sentiment is so high that anyone starts to pay attention to cryptocurrency news, watch cryptocurrency channels, and make watching price fluctuation charts a daily habit.
All of these actions lead to bad investing habits. Continuing to keep our blood on fire leads to spending hours staring at the rise of the green line we long for, and I did the same in 2017 when I only focused on the rise and ignored the fall.
secondary title
Spending hours watching price fluctuations will make you forget the reason you got in the game in the first place: long-term confidence in the asset. The nonsense of refreshing information every day and waiting for the opportunity to buy is like giving you the confidence to make a comeback, but it causes you to be hit as soon as you buy no matter how much the price has risen. Buying at a low price can only make money if you buy at a time when the real low price is not reached. At some point, its like an addiction.
secondary title
switch point of view
In order to seize the right opportunity to enter the market, I monitor and collect relevant information in real time.
If this statement is true, you should ask yourself, is this the right time? Why not refresh the daily news and seize the opportunity to buy when the price is lower than the price at which you bought it in the first place? (This is an objectively better buying opportunity)
If you bought at $12,000, you would experience a year of low prices. Of course, daily research also shows that the best time to buy is when prices are low, do you agree?
of course not. The reason for ignoring this statement is that no one can look at a price chart showing you lost money and stay positive. Have long-term confidence in the asset and research buying opportunities. In fact, the less you want to study the price, the less you will buy in large quantities.
This is emotion. This is what people say about dont get emotional in trading.
This time I get it, its like me in 2017. I predicted a big move up and called to buy. I began to trust my emotional judgment. Oh my god, my research really gave me a chance. Unfortunately, during a bull market, everyone seems to really be predicting price increases, and when the market stalls (which will happen), dopamine Stop functioning, which can lead to a host of adverse mental health problems. The feeling of hopelessness is real, the feeling of wasting time is real, and the feeling of loss is real.
secondary title
Token X is the rival of Token Y
While the market is slowly maturing, there will always be tokens popping up during a bull market claiming that X token is better, X token is the next Bitcoin, Y token is a better version of Ethereum. ” and “W token is the opponent of XRP”.
(According to a recent SEC filing, the U.S. government is an adversary of XRP.)
Oddly, these narratives did not circulate during the market downtime. Because no fool wants to buy these useless tokens. As mentioned earlier, fools only show up when the market is going up.
There is no doubt that everything in the cryptocurrency industry is speculative. However, these views are my views as a senior blockchain engineer in the industry. This is not investment advice, but a summary of the development of the currency circle in the past few years.
secondary title
Bitcoin use case
Bitcoins original value proposition was to replace cash. Everyone can buy coffee, pizza, and groceries with Bitcoin, but thats not yet a reality.
Bitcoin as a digital currency is not yet possible due to transaction fees, confirmation times, bandwidth, and reluctance to change the protocol to overcome these limitations. Instead, Bitcoin is now overwhelmingly used as a store of value. Most individuals with large amounts of digital currency never move bitcoins out of their wallets.
The store of value use case is simply digital gold. Everyone knows the uses of gold, some claim it has some industrial uses, but the vast majority of uses are as a store of value. The same goes for Bitcoin. I cannot predict the future status of Bitcoin as the number one store of value in cryptocurrency, there are countless reasons why it will be replaced by another blockchain, but the most important are:
Bitcoin will always be the oldest blockchain (if it keeps running), because Bitcoin was first, so the longer this blockchain runs, the more confident we can be in it.
Bitcoins supply is capped (although it can be changed, it may cause a hard fork, creating a completely new fork on the existing chain, while the original chain remains unchanged), so it can be proved that the unlimited number of tokens is Almost impossible.
secondary title
In the early days of Bitcoin, it was clear to many Bitcoin enthusiasts that the technology could be used for more advanced applications. Transaction value is the initial layer of Bitcoin because it is easier to implement. But the chain itself creates a decentralized collection of computing power, distributed across the globe, that collaborates toward a common goal. Due to the limitations of the Bitcoin protocol I mentioned earlier, it is difficult to leverage this global machine for tasks other than value transfer and storage.
secondary title
Enter Ethereum
Ethereum enables smart contracts to be deployed onto its blockchain, pieces of code that only function when interacted with. For example, but only works when used to send ETH. Ethereum came about after years of watching, learning, and understanding the pros and cons of the Bitcoin network, and then building the architecture so that the new chain could execute contracts. This covers not only use cases for value transfers, but also some seemingly unlimited practical applications.
Using smart contracts, companies have started a revolution. Start cutting out middlemen, making traditional industries more efficient and working in areas where they couldnt before. DeFi contracts enable citizens of countries suffering from monetary hyperinflation to receive stable interest rates on their savings. The summer of 2020 saw the explosion of DeFi, with over $14 billion locked in DeFi smart contracts on Ethereum alone. With the landing of NFT inspired by ERC-721, a revolution in games and art has begun.
Therefore, the value proposition of Ethereum is more complicated. Bitcoin is digital gold, Ethereum is the world computer or programmable money, or there isnt an easy analogy yet.
Anyone claiming to be an Ethereum opponent still has a long way to go.
secondary title
my technical analysis
Technical analysis is for the most part a matter of probabilistic coin flips. Think about this: Only 3% of day traders are actually profitable. And why are there so many ads on platforms like eToro, Plus 500, etc.? Think about it, the only reason the 3% are making money is because the other 97% are losing money. When novices enter the bull market, because of the rise, they have misjudged their abilities. Until all of a sudden, the truth was discovered, and it fell apart. The top traders make money, the fools lose money, start exiting, and lose money (until the next bull market in a few years).
Lets take traditional financial markets as an example. Being a day trader is not easy, not only because a human may not have access to all the information needed to make informed short-term decisions, but you are not fighting a human, you are fighting a machine.
Get rich quick and easy doesnt exist. It would be wise to be aware of your psychology.
secondary title
my forecast
This all seems to make me have no faith in the cryptocurrency market, but it is far from it. I see people I care about, especially those close to me, repeating my own mistakes and taking a toll on their mental health. I see the mistakes I made reappear. Before you get inside information from anonymous Twitter accounts and fake experts on YouTube and crypto news sites, understand that they are making it up. They cast big nets and wait to see who will catch the bait. I have my own predictions about the future direction and change time frame of the price of cryptocurrencies, and I will make decisions based on these predictions. But theyve gone from compulsively aggressive to occasionally curious.
For those of you who already know a lot about crypto, Id say were not smarter than anyone else. Instead of acting rationally based on facts, we now act on emotions. Crypto News and Youtube channels are not adding to our knowledge base, they are brainwashing us. Checking the price of our cryptocurrencies on a regular basis is not going to bring us anything (unless we plan to make a profit as soon as possible, in which case getting a 2x return would take 20+ years in traditional finance). And this is addictive behavior.
