Personal Sharing: How to Invest in Cryptocurrency

Author: Wang Feng, Twitter @wangfeng_0128; Source: SevenUp DAO

The cryptocurrency market investment experience I wrote for the internal team. In fact, I tried to do a three-year experiment. How to use the simplest way to look at trends, people, and assets. Today, I manage a $10 million crypto fund. This year It manages a fund of US$100 million at the end of the year. In the next three years, it may be able to manage a fund of US$1 billion.

Originally, there were ten items that could not be stopped. On Thursday, I wrote by hand while having a meeting. This is the first draft and may be continued in the future. If you don't like it, don't spray it.

1/ Build a primary and semi-market fund

< strong>Cryptocurrency market investment is completely different from the angels, VCs and PEs we have come into contact with on the traditional Internet in the past. This most active emerging market is an economy based on secondary market investment, with primary market investment empowering brands.

There is a very important logic behind this. We can completely understand the project by participating in the primary market and doing in-depth research. First-hand information can then exert its power earlier in the secondary market.

Instead of waiting for the primary market, the lock-in return will be two to four years. Native, decentralized, and even multi-channel liquidity are the unique charm of the crypto market. Therefore, what we want to do is actually the primary and semi-investment market.

2/ Stand with the most active entrepreneurs

Strive to stand with the best projects. There must be a smooth connection between the ability and the best entrepreneurs. To know what they are thinking, they provide us with first-line market signals and understand the market reference system and reference objects. Only by doing this can we search and judge based on where the next better project is. The so-called learning from entrepreneurs is the most valuable place. Emotionally, you have entered a space where you are developing together with the entrepreneur, and there is some resonance, which is definitely not a bad thing.

3/ Get your principal back quickly

Initial investment Projects are very cheap to enter early, and may be three times, five times or even higher. Sometimes, for example, if you earn from staking,even if the cost is not high, you must get back your principal quickly, don’t be greedy, and develop Habit. Especially for projects that have just entered the market, most of them are not listed on larger exchanges and have a serious lack of liquidity. Once there is a problem with the overall market sentiment, it will be difficult to get back the principal and they will be stuck for a long time.

If we have enough capital to start, we will have the next bargain hunting and the next new target.

4/ Long-term holding of top projects

The key point in the asset portfolio, 75-80% must be the current head, especially focusing on finding the absolute head of emerging sectors, such as underlying protocols and trading platforms.Big investments never look at the news. is a real trend. Once we want to adjust the position, it is also a replacement of the old head and a supplement to the new head.

5/ Investment is lateral thinking

Entrepreneurship and project planning are vertical thinking, digging deeper and deeper. What investors are accustomed to is lateral thinking, which is to design a combination of horizontal targets. Once the head of a market segment is found, they need to find the next new market and new head. Take the initiative to find new targets, discover new themes, and don’t be obsessed with one sector. Some people have invested in a sector agreement and feel that they are very knowledgeable and professional, so they continue to buy targets under this agreement, link by link, but this is actually unnecessary. Just get the head.

In the past, we often heard that investors should invest in the market that they understand. In fact, no one understands it innately. Often what you see as understanding is only really understood after investing. Many investors are even scared to death when they enter the project. It is not what they originally thought. In the cryptocurrency industry, things change faster. Investors in this field strive for the momentum of continuous learning, the courage to see opportunities, and the ability to correct mistakes in a timely manner.

6/ Focus on decision-making, not management

This essence , when you come out to invest, you can focus on “research and decision-making.” The last critical step to pull the trigger when investing is to respond directly to information collection. Investment is not management. I have seen some institutions that are not really big, and I feel that there are a lot of talents under them, and it is enough to manage them well. There are so many talents, but meetings are conducted in a gossip style, which is bad. In fact, if more people come in, the information may be good, but more of it will be terrible noise after the symphony of different modes. If there are more people and the rhythm is wrong, there is no need to write PPT. If the target you want to invest in is so exciting that you want to hug it and give it a kiss, why should you rely on PPT to polish it? Don’t make investment decisions complicated.

Investment in the encryption industry often cannot be delayed. When the market senses it, you must act immediately. Otherwise, if you get on the bus after rising, you may have the guts to use it to make decisions, but you will definitely give up half of it, and then you may become angry, or even lose control of your mentality, and make mistakes again and again.

7/ It is best for two people to work together

This is the same as how we organize our entrepreneurial team. The two-person combination is simply an ideal structure. You can look at the professional combination and ability combination. The majors of the two are complementary, one has products and technology, and the other has economics or finance, even sociology and psychology. From the perspective of ability or personality, some people are good at organizing resources, while others are good at making influence. The above are all gold medal combinations in terms of professional abilities.

If there is an investment team of two or even more people, one of them does not understand technology, and the other does not write Twitter, even the community cannot find them, In this mixed industry, it should be difficult to mix. Every industry is a mixed bag, and no one is easy to mix.

So, what are the strengths of the two of you?

8/ You may be too superstitious about your own expertise

When investing, be careful to fall into the endless K-line thinking. Once addicted, it will lead to short-term, short-term and long-term thinking. It is like a product development team that just falls into the endless pure coding thinking. It is busy in the code and looks professional. They work hard and have almost no time to meet with clients, and often end up running out of useless work.

There is a type of person who likes a tool or method very much. When practice makes perfect, in fact, people who rely too much on technical paths will start to ignore external factors. The world often looks down on differences. Once it is discovered that the changes cannot be analyzed within the scope of one's old tools, it is said to be metaphysical. Such people, living in a well decorated well, may not be suitable for investment.

In fact, whether investing or making products, there is one thing in common: to assess the situation, you cannot be overconfident in your own expertise. You must first jump out and look at the painting outside the painting.

9/Why is it difficult to place a bet

A good target is often known to very few people and not many people hold the currency. Once many people hold it and it has a great reputation, it means that the project has missed the investment stage and entered the best stage. So, investing is also a feeling of fighting against the odds and the courage to make a bet. Invest when no one cares. Last year, I asked a colleague to look at a new Bitcoin asset protocol token. When he saw that there were less than 1,000 wallet addresses, he said that the market was too early and there was no chance. I turned around and stared at the Bitcoin K-line. In fact, we entered the cryptocurrency market because we were attracted by the story that could have at least a 100-fold return.

There is a saying that you can listen to as a joke. Over the years, I have observed people who find pleasure in spending money and are suitable for investing.

10/Entrepreneur Gene

In the investment team, If you have a strong entrepreneurial background, it’s a plus. A good entrepreneur, regardless of his success or failure, must always maintain one of the most important qualities, which is hunger. It turns out that this has nothing to do with how old a person is. Being able to say "Stay hungry, stay foolish", Steve Jobs definitely understood human nature. On the other hand, a person with a seemingly prosperous background from a large factory may lose points.

In the past ten years or so, I have seen many entrepreneurs who were not very successful or even failed come out to invest, and there are many counterattackers. I have also seen some very successful professional managers come out to invest. They care about appearance and do not work at all. Why? People's sense of career achievement has long been satisfied. When these big company executives come out, they will not change the shortcomings they accumulated in big companies. They just use the money given by LPs as a front for early retirement.

11/Manage your expectations

Investment is ultimately If you look at the rewards, you should quit when it’s time to quit. When exiting, don’t worry about how good the next person is or how big the momentum will be if more investors join. When people are talking about selling, this is certainly the truth. When is the boiling point? You only need to care about one thing, manage expectations. How many times has your book return increased, and has it reached the expectations you originally set?

A person's small goals based on improving abilities, including professionalism, cognition, energy and charm, can all be improved through exercise. One's birth is destiny, no matter how high or low one is. Making a fortune depends on luck. If you can make money step by step, you are considered capable. The question is, how much money do you plan to make?

Be pragmatic and live long. As long as you are alive, you will have opportunities for YY.

If you write it, it becomes vulgar. When I first entered the crypto market, five years ago, I said that I would write "My Views on Crypto Assets" in the future as a summary. I kept thinking about it and couldn’t figure out where to start. Five years later, although I was unable to do anything, I actually learned a lot. The past five years have only been a supplementary lesson in general knowledge about markets, economics and finance. The only good thing was that I was horny as hell.

Update/The following four correct opinions can be listened in reverse.

Some of these conclusions are gradually being broken year by year. What innovators need is to be sure of their own knowledge and be willing to admit defeat.

1/ NFT is out! ——Token is more direct. Small pictures engage in non-fungible assets. How can it be?

2/ Bitcoin is good, that’s enough! ——Programmability extension? Now that Ethereum is available, don’t reinvent the wheel.

3/ Chain games have absolutely no chance! ——If I want to play games, why not go to consoles and online games?

4/ Earlier, I heard a senior with rich experience in the currency circle tell me personally, defi It's just that the capital market is booming. Don’t touch it