Disadvantages and pitfalls of retail investors participating in the inscription ecology

Source: Daoshuo Blockchain

In the previous article, I mentioned the opportunities that the inscription ecology may bring to retail investors in the next development.

Today I particularly want to highlight the cruel scenarios that retail investors may face when participating in the inscription ecology.

Let me talk about one of my conclusions first: Since at this stage and in the next period, the Inscription Ecosystem will be an arena full of retail investors, then most of the retail participants are destined to fight in it. They will all become cannon fodder, and they will all become the "bones" of others in "one general's success and ten thousand bones will wither".

According to my own habit of "anticipating victory before expecting defeat", before doing anything, I will first think of my own failure.

Similarly, for users who are trying to participate in the inscription ecology, I suggest that beforeplanning to enter the market, you should first think of yourself as that "bone" and think about how many "bones" you have. Can be sacrificed.

If you don’t have this kind of psychological preparation, it’s better to sit back and watch the fight between tigers and tigers.

After making this kind of psychological preparation, the next step is for our participants to pay attention to the pitfalls that we may step on:

The first big pitfall is to suffer. Emotional infection, complete loss of reason.

There are two main situations:

The first is that regardless of the price, if you see which project you are excited about, you will rush towards that project. The result of doing this is that there is a high probability of leaving the market with a loss in the end.

When we look at any project, in addition to paying attention to the fundamentals of the project itself, we must also pay attention to its price. The simplest way is to see whether its market value is higher than that of relatively mature blue-chip projects. Has a bigger bubble blown up? If the bubble is big, be careful.

We should also be cautious about projects with good fundamentals but poor prices. When encountering such a project, I would rather let it go than participate rashly.

During the climax of the rise of inscriptions in November, although I thought there were some projects that were pretty good, when I saw them, the prices were already not low, so I didn’t buy them because of the market’s enthusiasm for them. Buy with enthusiasm. Now the market is correcting, and many of them have fallen by at least 20%.

Looking at them at this time, it is hard to say whether it is worth buying now, but at least the price now is obviously much more rational than a while ago.

The second is to be blindly optimistic and confident about the currency you hold, being too inspired by certain remarks in the market, and even losing a rare opportunity to make profits.

The most typical thing is that after the project you hold has made considerable profits, you are still reluctant to leave the market. As a result, you bought it at a good price but failed to sell it at a good price.

I particularly agree with one point of view here: don’t be afraid of selling out.

For most investors, short selling is not necessarily a bad thing.

Compared with selling money, holding a handful of good chips and dreaming of a yellow beam, dreaming of relying on it to achieve wealth and freedom, turns out to be a piece of junk that cannot be sold. Cards are the bigger pitfall.

In addition, it is also a big pitfall if the currency sold rises again after the sell-off and then continues to buy after the price rises. Instead of chasing highs, it’s better to find the next target. If you really can’t find it, you might as well leave the field and watch the game.

The more noisy the market, the more we need to be calm.

The second big pitfall is to change chips at will. Today, it seems good to buy this, tomorrow, it looks good to buy that, and then immediately change hands to buy that. In the end, it was all in vain.

What we should note is that when the market is improving, general rise is the norm, but general rise does not mean that every project will rise simultaneously. Every project has its own rhythm: today you will increase, tomorrow I will increase, and the day after tomorrow it will increase. So as long as the things in our hands are not too bad, we should hold them patiently and don't change them at will.

Many times we clearly hold a handful of good chips, but when we see other people’s chips rising and our own remain motionless, we get anxious and change positions. As a result, just after changing positions, the chips I sold increased.

Some investors will say that it is best to follow the correct rhythm: buy a currency, wait for it to rise, and then sell it; buy a currency that has not yet risen, wait for it to rise, and then sell it. Drop; then buy the third coin.

I can only say that there must be people who can accurately implement this operation, but there is a high probability that it is not you or me, but the few chosen ones in the market. It is best for us ordinary people not to imagine that we are the chosen one.

Generally speaking, when we participate in this ecosystem, we must always remind ourselves to be rational, try to find low-priced original chips, and try to find things that others have not seen or have seen but do not understand. This is insurance that minimizes risks and maximizes profits, and can help us avoid a series of pitfalls and traps.