2022 Beginner's Guide to the Cryptocurrency Industry: How to Navigate Bull and Bear Markets?
The first lesson in the field of cryptography: maintain a skeptical attitude towards any suggestions.Original Author: Matti, Co-founder of Zee Prime
Original Compilation: The Way of the Metaverse
After my tweet aimed at crypto newcomers went "viral," I realized that this type of content is valuable to my readers, which is why I decided to write this simple guide for those relatively new to the field.
I understand how difficult it is to find the right direction in the dynamically evolving and chaotic crypto industry. The goal of this article is to help relevant newcomers navigate information overload so that you can build a foundation to help you weather bull and bear cycles in this field.
I am generally skeptical of advice, which might be the first lesson in the crypto space: be skeptical of any advice. By the end of this guide, you should ask yourself, "Is this just a psychological game?" If you don't ask, this guide will disappoint you.
Basics
The first rule is survival. Don't go bankrupt, which means don't go all in and don't get liquidated. Sell only on your own terms, and don't chase astronomical numbers, as you will force yourself to believe things you don't actually believe. Wishful thinking won't help you survive.
Be sure to read the post by Fred Ehrsam on how to survive in crypto cycles.
Curiosity is the best predictor of longevity in this field. If you are curious, you are likely to transform your inner speculator into a builder or super user. But sometimes you have to seek out more signals beyond just price.
You will want to find your place. Think of this as an exploration to discover how to be useful to others, even if you came here just to chase generational wealth. You don't have to quit your baby boomer job to get involved; just use your weekends to figure out how to help like-minded people in the field.
The best way is to have those around you help you as well. When I first entered the crypto space, I felt very lonely. I was fortunate to eventually connect with others in similar positions over time. If you can't meet such people in real life, then Crypto Twitter (CT) is the place for community gatherings, and the right exposure is crucial.
If you are not on CT, you might miss out. Everyone's CT experience is slightly different, as it depends on the accounts you follow and engage with. First, you need a good team, just like you had in school. Your parents might not want you to hang out with the wrong crowd. The same rules apply to CT.
I have provided a curated list of selected CT accounts that you can follow to fill your social and knowledge graph. These are my choices, so this is a biased list. Follow your curiosity and let it grow in various directions.
The x and y axes are just to provide some context. I realize that the CT accounts above are heavily skewed towards ETH. That's why I am providing some additional accounts for the non-ETH ecosystem. You can check the full list here.
Additionally, if you don't like my personally curated list, you can check hive.one for an algorithmically curated list of the most influential accounts in the entire crypto space, as well as individual clusters like BTC, ETH, SOL, DOT, or NFTs.
Make sure to follow those who expand your knowledge and open your mind. The people around you can guide you to the position that suits you best. Following those who ask the right questions and prompt the most interesting answers will provide the best answers to your key question: How can I be useful to like-minded people in the crypto space?
Learning to Deny CT
While some people love to talk about leaked alpha opportunities on Twitter, most are just clever beta plays. Be skeptical of anyone claiming "alpha"; true alpha is synthesized in your mind from bits and pieces gathered from Twitter, governance forums, and private conversations.
The chatter on CT greatly captures the current sentiment of people and excels at identifying what is happening now, but it is less accurate in predicting where we are going.
Sometimes, we tend to forget the value of those who think outside the bubble and do not participate in the cycles. Make sure not to overestimate CT, as it is primarily a place where sales happen. However, mastering CT can be beneficial for you.
Telegram and Discord
Once you start viewing Twitter as a discovery layer, you may want to join selected Telegram (TG) or Discord groups for deeper exploration. Typically, you need to focus on a few projects, trying to feel the vibe of the project and asking if there are ways to help specific communities.
Public Telegram groups are almost always noisy places, making it hard for people to navigate or have meaningful conversations. Almost all crypto projects have a Discord channel early on. This is much better for structured research and dialogue about the project.
Examples of thriving and inclusive Discord communities include Alchemist, OlympusDAO, KlimaDAO, Forgotten Runes, and Abacus. (Disclaimer: Zee Prime is involved in the investment)
Reading and Podcasts
Although I have mentioned some foundational readings in the Twitter posts above, there are still some things worth reading, perhaps more niche content. That's why I created a resource guide that categorizes interesting content and podcasts in the industry.
Please note that it may contain outdated or invalid ideas, but that does not diminish their value.
Additionally, if you are looking for an excellent crypto podcast, then Uncommon Core is perfect for you, and if you want to hear something more technical, then Zero Knowledge Pod would be more suitable.
"But I'm not a builder!"
One issue with the industry is that it primarily identifies coders as builders. This is not entirely accurate; there are many productive efforts in the crypto space that do not involve coding but provide immense value to the community.
For those who say, "Oh, but I don't know how to code," I have two answers:
The smartest people I know in the crypto space are not programmers;
If you think this might be something you want to do, then go learn programming (for example, Uniswap's founder Hayden learned Solidity by trying to implement Vitalik's blog posts, and now he is leading one of the largest crypto projects in the industry);
And there are so many things to do; projects need community managers, governance organizers, project managers, product leads, marketers, salespeople, etc. Lurking in Discord groups and staying active when needed is the best way to exercise your proactive beginner muscles.
Crossing Cycles
It all starts with Bitcoin, which is why understanding Bitcoin, Bitcoin enthusiasts, the related culture, and the evolving narratives will provide a solid foundation. Why do Bitcoin enthusiasts call every token a scam? Why do people in the Bitcoin community hate Ethereum? Why do people in the Ethereum community hate Solana and Polkadot?
The crypto space is full of conflicts, and these conflicts are likely to persist, making it difficult to reach consensus on fundamental truths given the different semantics and cognitions of each cluster.
Generally speaking, the time you enter the crypto space defines your worldview or crypto perspective. If you arrived here in 2013 and made a fortune by buying Bitcoin, your viewpoint will differ from those who arrived in 2020 and made money by holding SOL.
Many people get stuck once they have "succeeded." Therefore, doing it right just once is enough to create generational wealth. Then, you might defend your wealth and hope others help you protect it, even though it may be less profitable for them.
Here, we inadvertently stumble upon the "early arrival" problem. Why is this a problem? Once a project achieves success, that success is "priced in." When something has already risen 100 times, hoping it will rise another 10 times may be a luxury; manage your expectations well.
Everyone's sights are set on 100x or 1000x, and such opportunities are rare. Achieving this without luck requires a certain understanding of the industry. Chasing astronomical returns right after arriving is not a good idea.
If you are not early into some big projects, you may be driven towards some early but often lower-quality projects, as seen with the numerous OHM forks that have emerged this cycle. Be cautious with replicas; few can create sustainable wealth. There is only a thin line between being open-minded and being naive.
Over time, you will learn to balance between being closed-minded and overly open, between "my coin is the only coin" and "hey, the fifth imitator of X is definitely going to pump." But there is currently no consensus on how to define the middle ground.
The most successful people move within cycles, and they do not get trapped by narratives. In fact, each cycle teaches us something. Winners are often those who are flexible and focus more on the future rather than fixating on the present.
Marrying an idea is suboptimal. It is good to shed some path dependency and separate your past from your future. The crypto space changes very rapidly, so being able to adapt is crucial, but don't forget the lessons of history.
Bitcoin reminds us to trust systems. ICOs taught us new ways of capital formation and utility-less tokens. DeFi summer made us rethink tokens and their issuance. Countless lessons have been learned before you arrived here; try to familiarize yourself with them and avoid repeating the same mistakes.
Conclusion
Your success in the crypto space may depend on your ability to "follow your curiosity." You can follow it in various ways. You might try to learn how to build your own MEV bot, or you could spend a few days reading the market and analyzing its background.
Curiosity and drive are the best predictors of success in this field. Build a foundation through established communities, then venture into the unknown. Form theories and be able to update them.
But the process is not as important as the substance. Find your own way, ask better questions, and engage with smarter people. Joining a crypto tribe will make you feel like you are participating in history, and likely, you indeed are participating in history.
Further Reading:
“Senior Crypto Trader: 20 Tips for Newcomers”
“Talking About Investment and Speculation: How to Become a Qualified Investor?”
“Five Common Cryptocurrency Price Manipulation Techniques Investors Should Know”
