#068 - A $180k Crypto Lesson: The Value of Doing Nothing

How to succeed in a boring crypto market (by someone who’s been through a few)

I’m going, to be honest.

I haven’t looked at charts and crypto since the last newsletter.

Furthermore, I’ve been very busy working on my other agency, as it’s growing quickly and taking up much more time with client work.

The more time I spend there, the more money I make and the more I can invest in crypto when the on-chain edge index flashes a buy signal again.

If you look at Bitcoin on the weekly timeframe, it’s not doing much.

The crab market has begun.

Movements between $54k and $72k are noise that you should ignore.

You should not try to trade it with high leverage.

But today, I’d like to talk about the biggest enemy of your portfolio.

You will be able to understand the concept rather fast, but it can take months, if not years, to truly be able to master it.

First things first: I do not trade, and I’m not a day trader.

My investing style combines value investing and cycle investing with a large helping of on-chain analysis.

The biggest enemy of your portfolio is impatience

After you have decided to buy BTC or an altcoin, the hardest thing to do is sit on your hands for a few years and do nothing.

The best trades I’ve made are the ones where I completely forgot that I bought a certain coin.

A $180k Crypto Lesson: The Value of Doing Nothing

Let me share an example of a really bad altcoin trade I made where I fudded myself out of $160k in easy profit. (If I had timed the top)

At least $100k without timing the top.

My girlfriend (now wife) and I were travelling through middle and central America in late 2021.

We had taken a boat to the Galápagos Islands, and we were really excited about this part of the trip as it had been a bucket list item for quite a while.

Now, of course, I was always deep in the crypto trenches researching stuff and finding new altcoins to buy.

Anyway, there was this project that launched called $PEOPLE and their plan was to buy the constitution of America.

A stupid but fun idea, nonetheless.

For about 1 $ETH ($4k something) you could buy 1’000’000 PEOPLE tokens.

This was all through the smart contract you can swap in or out.

To make it simple, here’s the people chart timeframe with my actions and reactions.

Long story short, I swapped my people token worth around $4k back to ETH at no loss.

I thought I was lucky because the token was trading at $0.008 and was only worth $800 on the DEX.

This was because of FUD I read about the contract developer being involved with a previous scam and a lot of insider trading.

I kid you not.

Two days after I sold the tokens, there was a giga candle and the price of $PEOPLE went from $0.02 which meant $20k

The token kept going up and wicked all the way to $0.18 = $180’000

I probably wouldn’t have sold the absolute top but I had quite a few chances to sell between $0.15 and $0.18

The only reason I messed up was because I didn’t sit on my hands. I read too much information that wasn’t really relevant to the project and fudded myself out of a good trade.

High timeframe buy signals, News and on-chain risk metric = Onchain Edge Index

I won’t be sharing much news or onchain edge index metrics in the newsletter as it changes on a day to day basis.

Spending too much time in crypto when the market is boring leads to making wrong decisions.

That’s why I developed the onchain edge index.

A complex risk calculation of the most important on-chain metrics to identify if it’s risky to buy Bitcoin.

If you look at the spreadsheet below the 6th to 8th of august the Dollar cost average weighting was 0.5 while BTC was between $55k and $57k

Here’s an overview of the Onchain Edge index values:

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The onchain edge index showed a DCA buy signal on the 6th of July 2024. Did you catch it?

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