The Number One Thing I Wish I Knew Before Investing in Cryptocurrency

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No, it’s not investing in Dogecoin or Shiba Inu, or any other meme coin that rocketed to the moon and beyond. Though I do remember seeing Shiba offered on a decentralized exchange long before it went parabolic, chuckling at the dog symbol, and then simply scrolling past it. That’s the easiest 1000x bagger I’ve ever missed.

It’s not learning about DeFi platforms, such as PancakeSwap, and the numerous other liquidity pools on UniSwap, etc.Though I do remember hearing about PancakeSwap sometime in early 2021 on Twitter before it became super popular. CAKE was all of a few dollars at the time, and you could stake it for an APR of like 800%. It has since fallen back in price to about where it was when I first learned about it. And the APR is around 38% last I checked. 

Here’s the deal: You’re almost certainly going to miss out on like 99.9% of the greatest investment opportunities out there. There’s no point in beating yourself up over that. Just accept it.

But that’s actually great news. Because the truth is that you also have a 99.9% chance of finding a few great investment opportunities BEFORE they get big and deliver those nice, multi-X gains.

The biggest question isn’t whether you can find those opportunities. If you keep looking for them, it’s practically a mathematical certainty that you’ll eventually find one sooner or later. “Seek and ye shall find,” as the Bible says.

The real question is whether you’ll fully take advantage of the opportunity when you do find one.

In probably no other asset class is this rule more apparent than in cryptocurrency. The asset class where a coin or token can skyrocket 100–1000% and higher in a matter of weeks or days.

But you don’t have to luck out with meme coins, or sh*t coins, or risk rug pulls on dubious dex coins, or anything ridiculous like that.

When I look back at my crypto investments, my biggest regret is simply not investing enough in solid, reputable projects when they were cheaper, and when I had the chance.

In my article on Polkadot, I mentioned first starting to buy it in July of 2021, after it had tumbled from its initial high in the $40s, to as cheap as $10-$11 per DOT. I knew it was a solid project with a lot of developers, and a rapidly growing ecosystem. So, of course, I only invested a few hundred on the outset. Gradually dollar-cost averaging in, as you’re supposed to for proper risk management. DOT then proceeded to climb to over $50 later in November before falling briefly back down to the mid-teens this past January. It’s now in the early $20s, and still pays roughly 14% in staking rewards.

For Bitcoin, I had a similar experience. My first purchase was for all of $25 worth back in September, 2020, when Bitcoin was “only” about $10,000. I probably only managed to put in a few hundred more before it started really climbing in early 2021. Same deal with Ethereum, which I started buying initially that December when it was in the $700s.

It’s not like I didn’t have more money to invest into those coins at the times I discovered and vetted them as risk-worthy assets. If anything, I was overcautious, allocating far below what I could have and should have, proportional to my income and net worth. 

I didn’t lack funds. I lacked conviction. I was too timid. And that difference of temperament may have been what separated me between mere modest gains and possible financial independence.

Of course, to be fair, that overly cautious temperament of mine could also have been the difference between solvency and ruination, had those coins not broken out to the upside.

Look, I’m not saying to go out and plunk down tens of thousands on the first good investment you come across. And I’m certainly not saying to go all in on anything, no matter how much of a sure thing you think something is.

What I’m saying is sometimes all that stands between you and getting wealthy, or at least scoring big on an investment, is balls (or ovaries). 

Sometimes you’ve got to go in BIG on a conviction.

Imagine if the Winklevoss twins hadn’t committed heavily into Bitcoin when they first learned about it in Ibiza in the summer of 2012. They probably wouldn’t be among the first crypto billionaires today. Even worse, they’d still be known as the guys Mark Zuckerberg screwed over in that movie. In fact, you could even say that because they didn’t fully commit to their social network ConnectU, that they gave Zuckerberg the opportunity to take advantage of them.

Asset diversification has its place. My retirement funds are diversified, for sure. But diversification is also, as Michael Saylor puts it, “Selling the winners for the losers.”

Proper asset concentration, on the other hand, can make you wealthy.

As I continue my investing journey, one thing I’ve learned more and more is that it’s not so much about numbers or dollars. It’s more about psychology. It’s about being able to fight through the fear of loss, and committing strongly to a good asset or opportunity when you find one. 

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