Without an edge, you are just gambling.
Author: Duo Nine
Translation: Baihua Blockchain
If you want to profit in cryptocurrency, you need to have an edge. This can take many forms, but you must have one. Otherwise, you can only let the market dictate your fate.
An edge is a strategy, skill, or knowledge that allows you to achieve a higher probability of profitable outcomes over the long term.
Think of it as an advantage (like insider information that only a few can access) that enables you to profit. The key is that you need to be able to repeat this edge consistently until it disappears. Then, you need to change your strategy or learn new skills.
In the following content, I will share real examples to help you define your own edge. Let's get started!
A consistently profitable trader will tell you that an edge is a clear market advantage that can be exploited during specific periods. Arbitrage is one example.
If Ethereum is trading at $3,200 on Binance (BN) and $3,150 on Hyperliquid, a set of bots can net $50 (after deducting any fees) by buying on Hyperliquid and selling on Binance until the prices converge and the arbitrage opportunity disappears. This is a very robust trading strategy when market fluctuations are similar.
Similar strategies have also been evaluated in DeFi and across different blockchain networks, where the price of assets like Ethereum can sometimes plummet enough to make such arbitrage profitable.
However, arbitrage is a crowded trade and is mostly automated. For the average user, this edge has disappeared because market makers will "harvest" it as soon as they have the chance, and they incur almost no fees on these trading platforms (which is another clear advantage for them!).
How to Cultivate an Edge?
Buying and holding is not an edge in itself, especially if you buy and hold the wrong assets. However, if you combine buying and holding with the following points, you will gain an edge over time:
Understand what sound money is and why it is important.
Plan to accumulate hard assets, preferably high liquidity assets.
Be willing to wait for years or stack years to enhance the compounding effect.
Have stable sustainability that allows you to adjust your portfolio over time.
By evaluating the above methods against the right Bitcoin, gold, index ETFs, or real estate, you are likely to become quite wealthy in ten or twenty years. This is a buffered way to gradually develop an edge through continuous investment in assets. This is your strategy!
Taking the same approach with altcoins (shitcoins) is likely to lead to losses.
This method is a way to achieve successful communication. However, if you want to actively cultivate an edge, refer to the following examples.
Have a Strategy or Create a Strategy
Here are clear strategies that can help you understand what I mean by strategy:
Trade only one asset 30 minutes after the New York Stock Exchange opens each day. If the price is at a higher high during this 30-minute window, go long. If it’s at a lower low, go short. You hold this trade until lunchtime at most. Repeat this every day.
Participate in public or leaked token sales and follow strict screening criteria (no lock-up period or long vesting period after the token generation event). Sell these tokens within a week after they go live on the trading platform. Repeat this several times a year.
Set aside your dollar liquidity in five "buckets." Invest 20% of each cash portion into a yield-generating DeFi protocol. Your goal is to achieve an average annual return of 10% to 15% on your portfolio. This is four times higher than traditional finance (TradFi) interest rates. Review your portfolio and positions daily and maintain your edge accordingly.
If at the end of a week, a month, or a year you are profitable or in a profit state, then you have an edge. Note the net key of any strategy: it can be repeatedly repeated. This edge is considered invalid when you are no longer profitable or underperforming against a benchmark (like Bitcoin or AAVE with a 5% annual start).
Assess Your Skills and Then Double Down
Whatever strategy you choose, you must assess the skills required and refine them. By doing this, you can transform a mediocre strategy into one that gives you a rich edge. In the examples above, I mean:
Learn price action and technical analysis. Spend time observing charts; prices can "speak" to you. Refine your strategy so that you know exactly what to do at every moment. Repeating your strategy should become a spontaneous and predictable action, regardless of how the market moves, until you know when to buy, sell, stop-loss, and how to handle profits. Until everything is certain.
Build a network and "collection" on-chain over time. You can easily participate in private or public sales before tokens go live. This is your edge. For example, the MegaETH sale had 50,000 interested participants, but only 5,000 successfully entered. "Farming" such airdrops, selling, and buying more Bitcoin, then repeating.
Be an advanced DeFi user. You can easily assess the opportunities and risks of any new protocol across various blockchain networks. You deploy cash using the most optimized paths and bridges. As long as the returns are competitive, you "farm" and report any troublesome issues. This agility in quickly migrating in DeFi is your edge. You will leverage "farming" points and airdrops beyond your liquidity, further enhancing your returns. Again, repeat.
Discover and Leverage Any Edge
In most cases, cryptocurrency is a zero-sum game. If you want to profit, you must take from somewhere. This is why there are so many failures in this field. It is a highly leveraged industry.
To set yourself apart, you need to take a different approach. For example, I started my X account out of curiosity and interest, posting my analyses of various protocols and coins. This quickly gained followers.
Over time, having an audience can create leverage, allowing you to gain information before it is publicly available by interacting with teams and protocols that are unclear about your interests. This is a clear advantage.
Others excel at reading blockchains or can write bots to track or mirror whale movements in real-time. This provides them with very few public interactions.
Another way to have a clear advantage is to simply build something on-chain. As a developer, you control your product and can leverage this to gain an edge.
Conclusion
If you are in the crypto casino without a strategy or edge, do not expect to become wealthy. At best, you might get lucky with a meme token, but you will quickly lose that profit by gambling on the next token.
Spend a week or a month formulating, developing, and refining your strategy. First, identify your skills, which will give you a concrete edge. Once your actions start generating profits, you will know you are on the right track. If a previously profitable strategy no longer works, go look for a new edge.
The market always offers opportunities for those flexible enough to seize them early. Your role is to show up early and maximize the opportunity. When others follow the trend, that’s when you should exit.
Article link: https://www.hellobtc.com/kp/du/12/6159.html
Source: https://www.yourcrypto.community/p/how-to-find-your-edge-in-crypto-its
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