Author: @WarrenNakamotoX, crypto investor; Translated by: Block Rhythm editor Deep. Editor's note: This article shares the author's experience of achieving an eight-figure wealth through Crypto Assets and aiming for a nine-figure target. The core lies in designing a long-term compound interest investment portfolio, emphasizing discipline, patience, and realistic expectations. The author continuously outperforms Bitcoin by holding Bitcoin, utilizing borrowed funds for short-term trading, cyclical ace investments, and angel investments, while also protecting against downside risks. The key to success is focusing on the circle of competence, avoiding the chase for short-term windfalls, and enjoying the investment process, ultimately achieving steady wealth rise.
The following is the original content (original content has been reorganized for better readability):
What is the most beautiful thing that crypto assets can give you?
= The return that changes life
What is the ugliest thing that crypto assets can take away?
= All the earnings you have ever received
I know why you are here, the reason is the same as mine:
= Make money. The money that changes lives.
We know this is possible because we've all heard those success stories. But to be honest, you've also heard about those who have nothing in crypto and have never turned their lives around.
So, the real question is: what distinguishes these two types of people?
What is the true formula for success? How to avoid "losing everything"?
This is exactly what I will elaborate on in this article.
As you know, the total market value of crypto assets has been rising. I believe it will continue to rise, and it may even reach 1 trillion dollars one day.
· The global stock market is currently 126 trillion dollars,
· The global bond market is worth 140 trillion dollars,
· The real estate market is approximately 400 trillion dollars,
· And the Crypto Assets are only 3.5 trillion dollars.
Bitcoin (BTC) is already one of the top five assets by market value globally, and I am not surprised that it may become the largest asset in the future. In the next 24 months, I believe Bitcoin will surpass Microsoft, Nvidia, and Apple, becoming the second-largest asset in the world.
But unfortunately: if the market continues to rise and you are still losing, there is definitely a problem. It may be that your method is incorrect, or your strategy or skills need improvement.
Anyway, some things need to change.
The most important change, and what most people get wrong, is expectations. They see someone achieving a 50x or 100x return, so they jump in and chase the same gain.
I have seen too many people like this. Some of them even made a lot of money at one point, feeling invincible, only to quickly lose it all. Why? Because they never established a system, lacked discipline, and did not set truly reasonable goals.
I can achieve an eight-figure wealth, not because I am a genius, but because I set realistic expectations. Before entering the Crypto Assets market, I had been struggling in the stock market for over ten years. My goal was simple: to achieve a 40% annual compound interest rate (CAGR). After seven years of compound interest, my funds multiplied by 10 times. I did it, and I am incredibly proud.
I know that for most crypto assets traders, hearing a 40% annual return rate sounds like a failure, but at that time, it was already top-notch. The greatest investor in history, Warren Buffett, has only achieved an average annual compound interest rate of 19.8% since he took over Berkshire Hathaway in 1965.
19.8% makes him a legend. Sounds low, right?
But can you maintain a return of 19.8% every year for 60 consecutive years? Through wars, market crashes, economic recessions, and chaos?
This is true strength! It's not those fleeting enormous returns, but the quiet, tedious, and consistently outperforming market returns.
In the stock market, how do you determine if your returns are good?
You might ask, why outpace Bitcoin? Because if you can't do that, what's the point of investing in other coins? Just buy Bitcoin directly and lie flat.
Just a reminder, Bitcoin has risen more than 10 times in the past five years. Do you know how many people lost money during this time? Many. If they had just bought and held Bitcoin, the return could have reached 1000%.
About outperforming Bitcoin, for example:
· If Bitcoin performs +30% this year and you earn +40%, you are excellent.
· If Bitcoin drops -25% this year and you only lose -15%, you are still excellent.
To measure this, you need at least 5-10 years of performance to judge whether you are good at it. So, as I mentioned before, this is a long-term game.
This is a game of patience, a game of snowballing.
So, forget about the question "how to quickly 100 times". The real question is: how to continuously outperform Bitcoin's performance and never go to zero?
The answer is portfolio design.
· Design should be durable;
· The design should be compound interest;
· The design should protect against downside risks while seizing upside opportunities.
Even if you incur losses, there is still a great opportunity to win in the long run. This is the philosophy behind how I build and design my investment portfolio.
Alright, let's talk about how to actually outperform Bitcoin.
First, make sure your portfolio holds 100% Bitcoin. This way, you automatically match Bitcoin's long-term performance.
Then, I will lend, with the lending amount never exceeding 50% of my Bitcoin holdings. The annualized interest rate for lending is usually around 5%. I will use these funds to do a few things:
Short-term trading, up to 3 months
I only engage with projects that have strong fundamentals and can easily achieve 2-3 times returns, typically those that have declined during a bear market but still have solid products. I usually exit at a profit of 50%-100%.
For example, if you have followed me: $ETH, $PENGU, $ANIME, $COOKIE, $KAITO, and some that I haven't made public: $HYPE, $RAY, $JUP, $SUI.
I actively accumulate during bear markets and sell after making a profit of 50%-100%. When the bull market arrives and all coins reach historic highs, I usually stop trading.
$KAITO and $HYPE are my key projects in this cycle. However, when they drop, I sometimes add positions and make short-term trades.
Cycle Ace, single cycle high-confidence investment, up to 12 months.
This one really makes me happy. Currently I allocate up to 10% of my funds, but before reaching eight figures, I used to allocate almost 20%. Early success stories were $UNI and $CAKE, which I hadn't named "cyclical trumps" at the time. Last year I participated in the TGE (Token Generation Event) of $HYPE and achieved a 10x return in a month. Now I'm holding $KAITO, which has doubled and is still strong.
The cycle ace has two conditions: "screening" and "timing".
The screening criteria are high-quality founders who are rapidly developing, a strong community, products that are actually being used, and those that capture attention while still being in their early stages.
As for the timing, I only start looking for opportunities in the first year after the Bitcoin halving, and exit at most two years later. This rule has not changed for now, but adjustments may be made in the future.
angel investment, up to 24 months
The only reason I created this X account is to gain better angel investment opportunities. So far, it has been effective, and through introductions from friends I know, I have come into contact with excellent project parties.
I am currently supporting more than 15 projects. I know this is high risk and high return, but these funds all come from lending profits, so I don't really have any losses. I have indeed invested in a few bad projects, but the overall return is still good.
By using these three strategies, if I make money, I will use the profits to repay the loan and unlock my Bitcoin. This way, I only play with the profits. If the profits are large enough, I will buy more when Bitcoin drops, and then repeat this cycle.
What should I do if my trading and cycle ace perform poorly? First, your portfolio is not dead, Bitcoin is still supporting you. If Bitcoin continues to rise, you can borrow more funds to keep playing.
Your portfolio will only be doomed under the following circumstances: you borrowed 50% of Bitcoin, all your operations went to zero, and Bitcoin plummeted by 50%. You have to be extremely unlucky, making a mistake at every step, to encounter such a combination.
This is all my operations. I don't play with small-cap meme coins, I don't trade NFTs, and I don't engage in perpetual contracts, because I'm not good at it. I tried to learn, but found that it's not my area. If you're good at it, you can leverage funds from Bitcoin to do what you're good at. Focus on your own circle of competence; everyone has different skills.
The most important thing to me is: I love my life. I design my portfolio in a way that ensures I can sleep well, enjoy each day, do what I love, and never feel stressed about my investments.
Even when I started my Web3 journey in 2017, the goal was never to get rich quickly, but to slowly and steadily accumulate wealth while enjoying the process.
In 2017, I decided to achieve a wealth of 100 million dollars by 2030. Not by luck, not by gambling, but by building a bulletproof system that compounds over time. I feel that I am currently on the right track, which is why I am here to share everything. You don't need to copy everything 100%, just choose the parts that suit your risk, life, and goals.
I share this not because I think I am amazing. I am still in the learning phase, working hard every day to keep up with this rapidly changing industry. I hope you can learn something from this article and find useful methods to make your portfolio perform better.
The content is for reference only, not a solicitation or offer. No investment, tax, or legal advice provided. See Disclaimer for more risks disclosure.
The confession of "Shang An Lao Jiu" in the crypto world: how to outperform BTC and steadily achieve A8.
Author: @WarrenNakamotoX, crypto investor; Translated by: Block Rhythm editor Deep. Editor's note: This article shares the author's experience of achieving an eight-figure wealth through Crypto Assets and aiming for a nine-figure target. The core lies in designing a long-term compound interest investment portfolio, emphasizing discipline, patience, and realistic expectations. The author continuously outperforms Bitcoin by holding Bitcoin, utilizing borrowed funds for short-term trading, cyclical ace investments, and angel investments, while also protecting against downside risks. The key to success is focusing on the circle of competence, avoiding the chase for short-term windfalls, and enjoying the investment process, ultimately achieving steady wealth rise.
The following is the original content (original content has been reorganized for better readability):
What is the most beautiful thing that crypto assets can give you?
= The return that changes life
What is the ugliest thing that crypto assets can take away?
= All the earnings you have ever received
I know why you are here, the reason is the same as mine:
= Make money. The money that changes lives.
We know this is possible because we've all heard those success stories. But to be honest, you've also heard about those who have nothing in crypto and have never turned their lives around.
So, the real question is: what distinguishes these two types of people?
What is the true formula for success? How to avoid "losing everything"?
This is exactly what I will elaborate on in this article.
As you know, the total market value of crypto assets has been rising. I believe it will continue to rise, and it may even reach 1 trillion dollars one day.
· The global stock market is currently 126 trillion dollars,
· The global bond market is worth 140 trillion dollars,
· The real estate market is approximately 400 trillion dollars,
· And the Crypto Assets are only 3.5 trillion dollars.
Bitcoin (BTC) is already one of the top five assets by market value globally, and I am not surprised that it may become the largest asset in the future. In the next 24 months, I believe Bitcoin will surpass Microsoft, Nvidia, and Apple, becoming the second-largest asset in the world.
But unfortunately: if the market continues to rise and you are still losing, there is definitely a problem. It may be that your method is incorrect, or your strategy or skills need improvement.
Anyway, some things need to change.
The most important change, and what most people get wrong, is expectations. They see someone achieving a 50x or 100x return, so they jump in and chase the same gain.
I have seen too many people like this. Some of them even made a lot of money at one point, feeling invincible, only to quickly lose it all. Why? Because they never established a system, lacked discipline, and did not set truly reasonable goals.
I can achieve an eight-figure wealth, not because I am a genius, but because I set realistic expectations. Before entering the Crypto Assets market, I had been struggling in the stock market for over ten years. My goal was simple: to achieve a 40% annual compound interest rate (CAGR). After seven years of compound interest, my funds multiplied by 10 times. I did it, and I am incredibly proud.
I know that for most crypto assets traders, hearing a 40% annual return rate sounds like a failure, but at that time, it was already top-notch. The greatest investor in history, Warren Buffett, has only achieved an average annual compound interest rate of 19.8% since he took over Berkshire Hathaway in 1965.
19.8% makes him a legend. Sounds low, right?
But can you maintain a return of 19.8% every year for 60 consecutive years? Through wars, market crashes, economic recessions, and chaos?
This is true strength! It's not those fleeting enormous returns, but the quiet, tedious, and consistently outperforming market returns.
In the stock market, how do you determine if your returns are good?
= Continue to outperform the market.
In Crypto Assets?
= Continuously outperforming Bitcoin's performance.
You might ask, why outpace Bitcoin? Because if you can't do that, what's the point of investing in other coins? Just buy Bitcoin directly and lie flat.
Just a reminder, Bitcoin has risen more than 10 times in the past five years. Do you know how many people lost money during this time? Many. If they had just bought and held Bitcoin, the return could have reached 1000%.
About outperforming Bitcoin, for example:
· If Bitcoin performs +30% this year and you earn +40%, you are excellent.
· If Bitcoin drops -25% this year and you only lose -15%, you are still excellent.
To measure this, you need at least 5-10 years of performance to judge whether you are good at it. So, as I mentioned before, this is a long-term game.
This is a game of patience, a game of snowballing.
So, forget about the question "how to quickly 100 times". The real question is: how to continuously outperform Bitcoin's performance and never go to zero?
The answer is portfolio design.
· Design should be durable;
· The design should be compound interest;
· The design should protect against downside risks while seizing upside opportunities.
Even if you incur losses, there is still a great opportunity to win in the long run. This is the philosophy behind how I build and design my investment portfolio.
Alright, let's talk about how to actually outperform Bitcoin.
First, make sure your portfolio holds 100% Bitcoin. This way, you automatically match Bitcoin's long-term performance.
Then, I will lend, with the lending amount never exceeding 50% of my Bitcoin holdings. The annualized interest rate for lending is usually around 5%. I will use these funds to do a few things:
Short-term trading, up to 3 months
I only engage with projects that have strong fundamentals and can easily achieve 2-3 times returns, typically those that have declined during a bear market but still have solid products. I usually exit at a profit of 50%-100%.
For example, if you have followed me: $ETH, $PENGU, $ANIME, $COOKIE, $KAITO, and some that I haven't made public: $HYPE, $RAY, $JUP, $SUI.
I actively accumulate during bear markets and sell after making a profit of 50%-100%. When the bull market arrives and all coins reach historic highs, I usually stop trading.
$KAITO and $HYPE are my key projects in this cycle. However, when they drop, I sometimes add positions and make short-term trades.
Cycle Ace, single cycle high-confidence investment, up to 12 months.
This one really makes me happy. Currently I allocate up to 10% of my funds, but before reaching eight figures, I used to allocate almost 20%. Early success stories were $UNI and $CAKE, which I hadn't named "cyclical trumps" at the time. Last year I participated in the TGE (Token Generation Event) of $HYPE and achieved a 10x return in a month. Now I'm holding $KAITO, which has doubled and is still strong.
The cycle ace has two conditions: "screening" and "timing".
The screening criteria are high-quality founders who are rapidly developing, a strong community, products that are actually being used, and those that capture attention while still being in their early stages.
As for the timing, I only start looking for opportunities in the first year after the Bitcoin halving, and exit at most two years later. This rule has not changed for now, but adjustments may be made in the future.
angel investment, up to 24 months
The only reason I created this X account is to gain better angel investment opportunities. So far, it has been effective, and through introductions from friends I know, I have come into contact with excellent project parties.
I am currently supporting more than 15 projects. I know this is high risk and high return, but these funds all come from lending profits, so I don't really have any losses. I have indeed invested in a few bad projects, but the overall return is still good.
By using these three strategies, if I make money, I will use the profits to repay the loan and unlock my Bitcoin. This way, I only play with the profits. If the profits are large enough, I will buy more when Bitcoin drops, and then repeat this cycle.
What should I do if my trading and cycle ace perform poorly? First, your portfolio is not dead, Bitcoin is still supporting you. If Bitcoin continues to rise, you can borrow more funds to keep playing.
Your portfolio will only be doomed under the following circumstances: you borrowed 50% of Bitcoin, all your operations went to zero, and Bitcoin plummeted by 50%. You have to be extremely unlucky, making a mistake at every step, to encounter such a combination.
This is all my operations. I don't play with small-cap meme coins, I don't trade NFTs, and I don't engage in perpetual contracts, because I'm not good at it. I tried to learn, but found that it's not my area. If you're good at it, you can leverage funds from Bitcoin to do what you're good at. Focus on your own circle of competence; everyone has different skills.
The most important thing to me is: I love my life. I design my portfolio in a way that ensures I can sleep well, enjoy each day, do what I love, and never feel stressed about my investments.
Even when I started my Web3 journey in 2017, the goal was never to get rich quickly, but to slowly and steadily accumulate wealth while enjoying the process.
In 2017, I decided to achieve a wealth of 100 million dollars by 2030. Not by luck, not by gambling, but by building a bulletproof system that compounds over time. I feel that I am currently on the right track, which is why I am here to share everything. You don't need to copy everything 100%, just choose the parts that suit your risk, life, and goals.
I share this not because I think I am amazing. I am still in the learning phase, working hard every day to keep up with this rapidly changing industry. I hope you can learn something from this article and find useful methods to make your portfolio perform better.