Crypto investment risk identification requires mastering some key features, among which "Headless Coins" are a category investors must avoid. What are the typical characteristics of such coins?

**Core Features of Headless Coins**

A headless coin refers to a cryptocurrency that enters an accelerated decline phase after completing a major upward wave. Unlike normal corrections, headless coins usually drop more than 50%, forming a clear "headless" candlestick pattern—opening high and closing low or gapping straight down. Historically, XRP has experienced similar movements, and projects like ACT, ZKJ, WCT, MASK, LAYER have also undergone comparable accelerated declines.

**Why do headless coins keep falling?**

Once such coins form a headless pattern, it often indicates a concentration of large trapped positions. Investors seeing the deep decline may mistakenly think it's a "bottoming opportunity," unaware that each small rebound could be a trap for new buyers. The coin's price drops from the initial level through multiple stages: rapid decline → repeated low-level oscillations → slow downward trend → long-term inactivity. During this process, liquidity gradually dries up, making any rebound unsustainable.

**How to respond?**

If your holdings include such coins, be sure to exit promptly when a rebound opportunity appears. Waiting for a rebound often costs more than the temporary loss. Cutting losses in time and preserving capital for future trades are fundamental survival principles in the crypto market. Continuously learning market features and identifying risks is far more practical than hoping for miracles.