A decade in the crypto circle, from huge losses to stable profits, I want to share some real experiences. Many people often ask me why I’ve been losing money despite sticking to it for over a year. The truth is, it’s rarely bad luck; most people are just stepping into the same traps.

**First Trap: Small Funds Daily Trading**

Having just a few hundred thousand yuan and constantly fiddling with trading pairs is the fastest way to burn through your money. Small funds should never think about high-frequency trading; the fees alone can eat up a year’s worth of profits. The right strategy is sniper tactics, not constant monitoring. Key moments like Bitcoin halving or major updates in the Ethereum ecosystem can lead to a big bull run, enough to relax for half a year. Don’t look at big institutions hanging on exchanges every day—they are market makers and quantitative funds, with completely different models. For retail traders, trial-and-error with high-frequency trading is a dead end.

**Second Trap: Overconfidence in Demo Accounts, Hands Tremble with Real Funds**

I’ve seen too many people making huge profits on demo software, only to collapse when real money is involved. The core issue is that their trading system isn’t truly formed. The correct approach is: spend time researching outside the market, repeatedly practice your trading logic on demo until it becomes muscle memory, then enter with small amounts. On-chain data, project fundamentals, tokenomics—these are your real competitive advantages. Many only realize after losing money that—beyond their cognition—any gains will eventually have to be paid back.

**Third Trap: Chasing High on Good News**

"Good news being realized is actually bad news"—this is the most classic rule in the crypto world. When Bitcoin spot ETFs get approved in 2024, many rush in to chase the high, only to get caught deep. Why? Because the big funds had already completed their layout the moment the good news was announced; retail investors are just the bagholders when they enter. Learn to think in reverse: when news is flying everywhere, it’s often the closest to the top.

**Fourth Trap: Heavy Position in a Single Coin**

Loving a certain blockchain and putting all your money into it is gambling, not investing. The market always has variables you can’t predict—policies, competitors, technical vulnerabilities—that can wipe you out entirely. The proper approach is diversification: core coins should make up the majority, with others leaving room for flexibility. The essence of risk management is: never put all your chips on one bet.

**Fifth Trap: The Psychology of Chasing Rises and Cutting Losses**

Seeing prices rise, FOMO kicks in, and without analysis, you rush in; when prices fall, you get scared and sell at a loss. After one cycle like this, your principal is gone. The real winners are those who can control their psychology, stick to their trading system, set stop-loss and take-profit points, and execute without emotional interference.

**Sixth Trap: Blindly Following Small-Cap Coins**

A small coin suddenly surges, the forums are full of hype, and then you follow the trend. The result? 99% chance of getting caught in a trap. Small coins often have poor liquidity, are easily manipulated, and projects can rug pull—risks are extremely high. Beginners should first hone their skills on mainstream coins, and only consider other opportunities once they truly understand the market.

**Seventh Trap: Ignoring On-Chain Data**

Looking only at candlestick charts is far from enough. Whale wallet movements, exchange net inflows, on-chain activity—these data points often predict market turns better than technical patterns. Learning to read on-chain data can help you spot turning points earlier, giving you an edge over most traders.

**Eighth Trap: Leverage and Margin Trading**

Borrowing to trade crypto seems to amplify gains, but in reality, it magnifies risks. One black swan event, a leveraged liquidation, and your principal is lost plus debt owed. Crypto volatility far exceeds traditional markets, and using leverage often ends in tragedy. Steady gains come from avoiding leverage altogether.

**Ninth Trap: Not Cutting Losses**

Many hold onto losing positions, even adding to them to lower the average cost—this is the biggest trap. Stop-loss is part of your trading system, not a sign of failure. Set your stop-loss points, keep losses within acceptable limits, and only then can you survive longer and wait for real opportunities.

**Tenth Trap: Overtrading**

Thinking that sitting idle is wasting opportunities, so you trade frequently. In reality, most trades are noise. The best opportunities only come a few times a year; the rest of the time should be spent observing and learning. Better to miss some trades than to make mistakes.

In summary: making money in crypto depends on cognition, discipline, and patience—not luck. Build a solid trading system, manage risks thoroughly, develop mental resilience, and the rest is just a matter of time.