Long-term survival outweighs short-term sporadic profits

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Reading time: 3 minutes

This is a topic at the level of trading philosophy. To put it broadly, it might seem hollow given everyone’s current situation, so I’ve decided to bring it down to the learning level and discuss it with you from a practical perspective.

My followers in the crypto space are generally traders with high moral standards and fundamental understanding. When facing collective events, everyone tends to remain calm. That’s why I’m happy to share my views with you, standing as friends. I hope you do well, with a smile on your face, exuding the confidence and maturity of a successful person in your every move.

Years later, I hope we all gather together and enjoy a drink! But before that, you still need to pay attention to some details within the circle to achieve the goal of long-term survival.

I haven’t done any specific statistics, but based on my social circle from my seven years in the industry, it feels like over 90% of people ultimately end up fading out of the crypto space; within a cycle of 3 to 5 years, it seems that over 99% of people only deposit and never withdraw, meaning they are very likely to incur pure losses. This number is not an exaggeration. Ask yourself, how much have you actually made?

So, the first priority after entering this space is not to learn technical analysis or fundamentals—these are not important at first—but to figure out how to survive in this industry for the long term. Only by staying alive does tomorrow matter to you.

Therefore, I believe: long-term survival outweighs short-term sporadic profits. The former is a reflection on life and the path you must take in this lifetime; the latter is just the fleeting joy and sorrow of a gambler, merely using “crypto trading” as an excuse to play games, even deceiving oneself.

So, staying alive is the first lesson in the crypto space. You need to quickly find your own niche in this jungle and integrate into the food chain. Then, based on your own strengths, do what you are capable of.

For example: both elephants and snakes have their place in nature. Quickly recognizing your own niche means you won’t make the ridiculous mistake of overreaching, like a mantis trying to stop a chariot or a snake trying to swallow an elephant—tragedies or beginner mistakes that are laughable in hindsight.

Through both internal and external cultivation, I want to offer you some learning advice, which is the focus of today’s discussion. I hope it can inspire your attitude and direction in learning!

(1) External
Many people simply pursue technical improvement or seek priority access to news, and when summarizing their losses, only focus on these two external factors. As a result, many “eager learners” feel they have accumulated a lot of knowledge over time but can’t apply it in practice, or their actual trading deviates greatly from their expectations.

From the perspective of group or social effects, this isn’t hard to understand.

This is a conditioned reflex caused by the exam-oriented education among Chinese people, where not achieving profits is equated to “not getting good grades because you didn’t study hard enough,” leading to cognitive bias. This tendency to focus on theoretical knowledge while neglecting effective practice is brought into the crypto space. I’m not saying you don’t work hard, but that you’re putting effort in the wrong direction.

Since we are wolves, we should study how to hunt sheep, rather than wait passively for handouts like sheep waiting to be slaughtered.

As my father often told me: a kingdom is only gained by fighting for it, not by being given to you—you must strive for everything yourself.

Focusing on building theory without applying it in practice is a classic case of “learning without reflection leads to confusion.” Here, “learning” means actively acquiring external knowledge, while “reflection” means integrating that knowledge with your own circumstances through internal exploration.

Of course, the corresponding saying is, “reflection without learning leads to peril.” This refers to armchair dreamers, which is outside the scope of today’s discussion.

Broadly speaking, 99% of newcomers to the industry fall into this category: without any professional knowledge, or even understanding the basic processes, they rush into whatever others say is good. Only after losing money do they reach the stage of “learning without reflection leads to confusion.”

More narrowly, not having a trading plan, wanting more when prices rise, rushing to break even when prices fall and getting trapped deeper, or not setting stop losses, are all manifestations of “reflection without learning leads to peril.”

These are the external manifestations and root causes for most confused traders!

(2) Internal
Through communicating with you all, I can sense that most people understand the reasons behind their problems, and sometimes do quite well in actively acquiring external knowledge. But the serious issues still arise from failing to integrate what they’ve learned with their own circumstances through internal exploration.

This often leads to neglecting their own inner potential, resulting in a serious lack of basic self-awareness, even reflecting on the wrong things. By reflection, I don’t mean reflecting on how much external knowledge you’ve acquired (Chinese people are very competitive in this regard—there’s little difference).

Rather, I mean internal self-reflection. I don’t know how to articulate this specifically, but simply put: “Why do you keep making the same mistakes, or fail to act on what you know?” For example:

Before you trade, do you set a basic trading plan (entry price, position size, take-profit/stop-loss), and do you execute according to the plan?

If you set a plan and execute it, even if you make mistakes, you’ll understand where you went wrong. Such mistakes are meaningful and will help mature your trading system, allowing you to move beyond the basics and develop your own trading style.

There are many similar examples, but I won’t list them all. In short, when you learn something new, you should integrate it into your trading system, not just memorize it or fantasize in isolation. (Now I see why so many experts talk nonsense.)

Summary:
External reflection is about whether you actively acquire external knowledge; internal reflection is about whether you transform that knowledge into your own ability. Both are indispensable.

This content is also an attempt to put our first lesson, “Long-term survival outweighs short-term sporadic profits,” into practice from a philosophical perspective.

The maturity of your own trading system is the foundation for your long-term survival. Without your own trading system, if you rely entirely on others’ signals or ideas, even if your win rate is high, you’ll fall into the trap of being lost in sporadic profits.

At that point, you won’t understand more advanced topics, or your conversion rate will be extremely low. Situations like the flash crash on October 10 and getting liquidated will be unavoidable.

Getting liquidated is not worthy of sympathy; it’s just your own greed setting off something that was bound to happen eventually.

When it comes to trading systems, don’t think it’s something lofty, distant, or be unconfident—every trader must have one.

Essentially, it’s just about using the trading methods you’ve mastered to coordinate and plan your entry price, position size, and take-profit/stop-loss. These are methodological issues.

Simply put, it’s about where to buy, how much to buy, and when to sell. It’s that simple!

These are the basics for moving up, intended to guide you to approach trading with methods I consider appropriate, whether you’re a beginner or advancing. First, take a good look at your own internal and external strengths and weaknesses in trading.

But for long-term survival, these alone are far from enough. In the coming days, we’ll talk about position sizing and entry points from a methodological perspective. #BTC