9th December 2024 > > How not to fumble your alt coin bags.

tl;dr

A little insight into the differences between crypto speculators and crypto investors. A top tip as to how not to fumble your alt coin bags in a bull market.

Market Snap

Market Wrap

There is definitely a feeling of alt season in the air. Most days we see one or two pop-off for no apparent reason – just in the last couple of hours it was BABYDGOE rallying by a third. Surprisingly, alt coin speculators find it very difficult to make money in such an environment, which sounds somewhat counter-intuitive. See below for more details.

Occasional Series – Peter Schiff

Just two years ago, in December 2022, liberty denier and crypto hater Schiff pontificated:

“My advice to people in crypto is get out. You could still get almost 17000 for your worthless Bitcoin. I would suggest that take it (sic) and buy some gold."

Hahahahahahahahahahahahahahahahaha.

Hahahahahahahahahahahahaha.

Hahahahahahaha.

Hahaha.

Oh boy.

Dude, you have never been so wrong.

Curious Cryptos’ meme corner – you know it’s true

Curious Cryptos’ Commentary – Sunday newspapers

Yesterday’s papers were chock full of crypto reports triggered by the breach of $100k to the upside, reports that were mostly of the disparaging kind.

And in some respects, I can’t help feeling that is the right thing to do, though the writers are obviously wrong/misinformed/stupid/wannabe autocrats (delete as appropriate). For the thing is, crypto speculators will always lose money. Crypto investors will always make money. This is the key message encapsulated in the meme above. Reading an occasional newspaper article does not an investor make.

I hope that a daily dose of the CCC might help.

Curious Cryptos’ Commentary – Alt season & what it might mean for you

Most alts are purely speculative plays, and enjoy/suffer (depending on your outlook) a much higher degree of volatility than any other asset class one could mention. This is most certainly true for one of the winners of 2024 – meme coins.

Most alt players will lose money, even in a raging bull market, which is what 2025 is shaping up to be. The reasons are few and simple to understand.

Out and out speculators will gamble on a coin for a number of reasons, none of which have anything to do with fundamental value. It might be that a coin attracts attention for moving up 5x in a day. Or a favourite influencer (who is being paid in the coin they are pushing to the influenced) makes some unjustifiable claims. Meanwhile, there are plenty of jazzy videos on YouTube claiming this one to be the next SOL killer, or this one will 100x by Tuesday at 9am. In all these cases, the out and out speculator is largely providing exit liquidity to the early adopters, and that is bound to end in tears. You must avoid being a member of this cohort at all costs, even if that means never looking at an alt again.

The more thoughtful alt investor will consider the use case, the team, the white paper, the tokenomics, amongst other factors. And that is all well and good. But that doesn’t take away from the fact that the vast majority of alts are speculative in nature which means that investors must have a firm and detailed exit plan in place before investing. And I know of few people who do that, though of course the CC Treasury follows best practice.

An exit plan is critical for one reason – if it is laid out in stone, and you never change it, that takes all the emotion out of selling alt investments. If the emotion is left in, the desire to sell the top guarantees a worse outcome than would otherwise be the case. Anyone who has been involved over a number of crypto cycles knows this to be true.

The plan must set out what number of coins are to be sold at specific price points. Orders have to be left on either centralised cryptocurrency exchanges, or by using trading bots for coins that are only on DeFi platforms. When orders are filled (as they surely will be over the coming months, even at what might seem to be egregious targets today) the response has to be “that’s a great trade”, not “oh, it has gone higher now, I should have waited”. The key to a successful exit plan is that everything within the plan but the final moon bag (and sometimes that too) is immutable, like the blockchain itself.