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Make sure you know what you're doing if you're investing during a bull market!

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@d-pend
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A lesson from my past I'd like to share... _____________________

Hey everyone. I thought I'd write a bit regarding a topic that most seasoned investors are familiar with — especially within the crypto space — where 500%, 1000%, and even 10,000% returns are somewhat commonplace during the bull phase of the market.

Many people find themselves somewhat blindly buying into a coin when it is low, even completely forgetting about it until the market starts to go ballistic, and suddenly find themselves with "free money." I would know — I got lucky buying BTC at $600 and ETH at $15 back in 2016.

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I knew a little about Bitcoin, enough to know it seemed like a good investment, and knew practically nothing about Ethereum. Still, when Coinbase added Ethereum towards the end of 2016, I thought, hey, why not buy a few hundred dollars worth.

Next thing I knew, while I focused on the music album I was working on (that I have sadly yet to complete) my portfolio had gone 6-7x during the past months that I wasn't paying attention to anything related to crypto.

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I was on top of the world! I couldn't believe it. I felt like a genius, even though I knew it was mainly a lucky break. I felt magnanimous, and armed with all this newfound capital, I began to research into so-called altcoins for the first time. This is also when I discovered STEEM through a random message I saw in some cryptocurrency Discord. Intrigued, I made an account and a first post, and shortly after I began my long love affair with this chain by buying a fair bit of STEEM at $2.50.



[Screenshot of BTC-STEEM chart from 2017-2019 taken on Bittrex](https://bittrex.com/Market/Index?MarketName=BTC-STEEM)

I couldn't get enough! I bought BAT, XRP, GNT, XLM, DGB, DOGE, ETC, LTC, and LOADS of other altcoins. I sent tons of crypto to friends that I invited to Steemit. Little did I know that for most of my purchases, I was buying at the local peak — after which they would steadily decline in Bitcoin value for several months until their next major explosion at the end of 2017/ beginning of 2018. I believe I got impatient and sold most of them at a loss before they eventually rallied again.

The ironic truth is after all my winning and losing trades over the past 5 years, I would have been better off just keeping my 6 BTC and 30 ETH until the present day. I am sure many have similar stories. However, I likely would have never connected with all the interesting people that I've met on STEEM (now HIVE,) and I don't regret making any of those mistakes — making losing trades is something of a rite-of-passage for any investor.

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One reason I bring this topic up is that I notice a building euphoria in this space that reminds me of 2017 quite a lot. You start seeing figures like "$100 ADA, $10 DOGE, $1K LINK during this cycle" being thrown around by hype-trainers. Market cycles are so heavily based on emotion that it is important to temper idealism/optimism with realistic analysis. To be clear, none of the aforementioned price-points are impossible to achieve eventually — but they are extremely unlikely within a short time frame when you look at their performance over the last 12 months (not to mention the total market cap some of those figures would put said projects at.)




Screenshot of past 12 months of [ADA](https://www.coingecko.com/en/coins/cardano) and [DOGE](https://www.coingecko.com/en/coins/dogecoin) (against U.S. Dollar) from @coingecko

Of course, with many coins — even if you buy near the top, you are somewhat likely to be able to at least break even if you wait long enough. However, it may mean your capital is locked up for years before this occurs, during which wait many people panic sell or decide to cut their losses.

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Conversely, during a bear market, there is overwhelming pessimism, nihilism, depression, and apathy that leads people to not seize great opportunities by dollar-cost-averaging back into solid projects as they bottom out.

Overall, it is wise to avoid buying into something solely based on hype without really knowing much about the underlying asset. If you are confident in a project and know why you are investing in it, you are more likely to have the mental and emotional fortitude to be able to stomach short-term losses while focusing on a future price target you are looking to hit.

Have you had the experience of making some profits in a bull market and "buying the top" of something else, only to lose much or all of your initial gain? Let me know in the comments below!

Be well, @d-pend . original post created for Leo Finance
on HIVE — posted March 16, 2021.

Above images are screenshots from Bittrex and Coingecko. Below image is the @leofinance logo processed with [Deep Dream.](https://deepdreamgenerator.com/u/dpend/)

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