🧐 He once owned 370 bitcoins, but ultimately died on "at most 3x leverage"｜Many people have not mentally prepared for "losing this money" at all!

I hope everyone reflects on their own appearance in real trading scenarios and sees if these stories resonate with you!

If so, then it’s very dangerous.

I have previously mentioned that most people may have been in the industry for many years, trading with contract leverage every day, but in reality, they have never truly understood what leverage is, and that is the most dangerous part;

Let me share a personal story:

Several years ago, a friend introduced me to an older guy from Shandong. He was eager to find a good project or product to resolve some debts, and at that time, he had several million assets in the stock market.

After hearing about his situation, I felt he should withdraw from the stock market. The Shandong guy and I talked several times; he was very smart and could understand my advice and the characteristics of bitcoin. At that time, it was relatively low for bitcoin, and soon after, the major crash on March 12 happened.

He took my advice and heavily invested in bitcoin, buying over 370 bitcoins at its peak. Not long after, there was a bull market, and his assets increased by more than 20 times. This money was a huge fortune for him, enough to pay off his debts and have enough to make a comeback. If he had held on to it until now, he would definitely be a winner in life.

Unfortunately, this Shandong guy did not continue this myth. We lost contact for a while, and three years later, I heard from his family who consulted me about some legal issues because he was arrested for illegal fundraising, and he had mentioned to his family that I understood this area well.

I was surprised; how could someone with such significant assets engage in illegal fundraising?

Later, I discovered that the root of all evil was: leverage!

I always felt guilty because I had told him about bitcoin as an investment target, but initially, I was happy for him when I learned he had over 300 bitcoins.

However, I didn’t expect that during his exploration, he discovered contracts and leverage. According to his wife, in the first month of exposure, he made over 20 million, feeling like he was the best trader in the world.

His wife said that during that time, money felt like it was not money because it came too quickly, and he didn’t cherish it, spending it recklessly. But he fell in love with that feeling, and it spiraled out of control.

There were several times he called me for advice, and I sincerely warned him not to touch those things. His response was: "It's fine, I’ll just use 3x leverage at most, usually controlling it around 2x leverage, so it’s not a big deal."

After that, we didn’t keep in touch much until the year before last when I learned he had gotten into trouble. His wife and family consulted me about legal issues, and when I opened his exchange account while helping the lawyer trace the flow of funds, I was shocked and understood the reason for his illegal fundraising.

First of all, this guy was very lucky and skilled; he decisively sold his bitcoins at the peak in 2021 and, as expected, reached A9, withdrawing tens of millions to pay off debts and even buying a villa and a Porsche for his family. According to his wife, at that time, they truly felt like heaven had opened its eyes, and everything was getting better.

Then the turning point happened at the end of 2021. I found records in the exchange showing that his first trade involved an $80,000 leverage position, going long on bitcoin, just in time for a favorable trend. Subsequently, he kept going long, indeed turning $80,000 into over $2 million in just over a month.

I think this is why he felt confident about continuing with contract leverage, but it was also the biggest trap.

In the following months, making money became less smooth. To achieve results, he became obsessed. I saw his account was extremely crazy; for nearly half a year, his daily income was around 800,000 RMB, every day!

Then the number of trades he opened daily became even crazier, sometimes trading from around 10 AM to past midnight, almost without interruption.

The so-called leverage not exceeding 3x was indeed the case at first, but soon after, or occasionally when trying to recover losses, he would open positions at 10x, and I even saw several trades with higher leverage, 20x, which became commonplace later on.

Thus, the Shandong guy completely became a gambler! Clearly, no matter how large the assets, they couldn’t withstand such turmoil, and soon he lost all his money. Then, in an attempt to recover, he used his cautious connections to sketch out a fake project, promising high interest to many friends to borrow money, but in reality, all the borrowed money went into the contract market, and he continued to deposit hundreds of thousands daily.

So in less than half a year, some friends couldn’t even pay the monthly interest, and everything collapsed, with him being sent in by his friends.

It’s quite lamentable!

Just like the story Mandy talks about below, what is truly revealed here is not leverage, but human nature: low leverage is the most dangerous illusion for ordinary people.

Once leverage is used, whether 1.2x or 100x, you have already left the spot world and entered another set of survival rules.

This set of rules is something most people have never seriously considered; they just feel they can make money and rush in, calling it: "Take a chance to turn a bicycle into a motorcycle!" Little do they know, this is actually the devil's door opening for them.

1️⃣ Spot Thinking vs. Leverage Thinking.

Leverage is not about the multiple; it’s about switching survival rules.

Once leverage is used, whether 1.2x or 100x, you have already detached from the spot world,

Unconsciously entering a game dominated by volatility sequences, retracement paths, and emotional endurance.

2️⃣ Seeing clearly and executing are two different things.

"Seeing correctly" is not important in leveraged trading; execution is the lifeline. Countless people make correct directional judgments but fail due to position management, stop-loss execution, and decision-making distortions caused by continuous declines.

Because during execution, human greed and fear will make you unable to stop, so the feeling of losing control during review is an insurmountable barrier.

In investing, don’t deceive yourself; most people will likely step into the same pit again after falling into one, and there is generally no such thing as learning a lesson.

3️⃣ The Infinite Amplification of Greed

Low leverage is the most dangerous illusion for unprofessional traders.

It makes people abandon their respect for entry points, risk control, and stop-losses,

Using "I can still hold" and "I'll add a bit more" to hope to recover losses, amplifying risks infinitely without awareness.

This is the same as being in a casino without realizing it.

Conclusion—

So you see, the real problem for many people has never been how many times they opened leverage. Rather, they have never done any psychological rehearsal for "losing this money."

Once money starts coming in quickly, people automatically assume: it will continue to come.

Once losses occur, people automatically assume: as long as I hold on, I can recover.

The most terrifying aspect of leverage is not the liquidation, but that it pushes you from being an "investor" to a "gambler" before you even realize it.

Once a person enters the gambler's track, they cannot return to the normal track because the gambler's track is simply too thrilling and enjoyable. Those who have experienced that kind of pleasure find true investing to be bland.

So the real question should not be: "Can I use low leverage?"

But rather: If you are a normal person, then you better not touch it at all!

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