A few days ago, a friend shared a case with me, saying that someone made 5 million dollars with just 10 dollars. As shown in the picture below.

I have actually heard quite a few similar stories, and I can only say that such things can indeed happen, but they won't happen to most people. If someone can leverage contracts to turn a small amount of capital into large profits, I personally do not envy such results, nor would I deliberately try to imitate them, because I know I definitely cannot do it; I won't engage in leveraged contracts anyway.

For me, investing is a long-term practice.

For most ordinary people, 10 million should be a good financial goal, but it is obviously impossible for ordinary people to achieve this goal solely through working. Even if someone can earn a million a year through work, achieving a personal net worth of over 10 million is still a very difficult task, as they need to consider various issues such as working age and daily expenses.

At this point, some people might comment and continue to nitpick. Perhaps someone will say that any family in Beijing, Shanghai, or Guangzhou has 10 million, such as those who have been relocated or families with several properties. From this perspective, it seems to be true, but what I mentioned above is a net worth of 10 million. In fact, the liquidity of houses is very poor. It seems that many people in places like Beijing and Shanghai have assets in the tens of millions, but how many can directly take out 10 million in cash (including US dollars)?

In simple terms, there are mainly a few ways to generate money:

• Use your body (physical strength, mental capacity, time) as capital to generate money

• Use your assets (money) as capital to generate money

• Use your connections (background) as capital to generate money (this seems to be a sensitive topic, so I won't elaborate)

Regardless of whether you generate money using your body or your assets, it is actually cyclical. For example, many people have been saying in the past two years that the overall environment is not good, there are many unemployed people, and many malls and shops have closed down, making it difficult for unemployed people to find good jobs, while those who are employed are becoming increasingly competitive.

Similarly, even if you want to use money to generate money, you also need to consider cycles. In other words, any financial market is cyclical, whether it is stocks, gold, or cryptocurrencies.

But it is clear that the people who can truly make big money right now, such as earning 10 million, are definitely those who use assets (money) as capital to generate money. The strategy to earn 10 million seems relatively simple; I summarize it in one sentence: increase the value of assets by grasping the rules of cycles.

In simple terms, as long as we can buy certain assets during periods of market undervaluation and then sell the corresponding assets during market bubbles, then:

• Those who invest a capital of around a million may achieve the goal of 10 million in 1-2 cycles;

• Those who invest a capital of around a hundred thousand may need 2-3 cycles to achieve the goal;

• Those who invest relatively small amounts, but if they can master some effective investment methodologies and choose a market with a higher risk-reward ratio (such as the crypto market), then persisting through several major cycles may also achieve the goal.

But saying it is easy, doing it is very difficult! So, in this issue's sharing, I will combine the crypto field and some of my personal experiences to try to outline a few key points that I believe are important in the process of achieving goals, hoping to bring some new points of thought to everyone.

The following 8 points are all based on ideas and methodologies, and I do not provide any specific so-called wealth codes (i.e., I will not recommend any projects or tokens).

1. Risk Management is Crucial

In the crypto field, the most important thing is to prioritize risk management first. No matter how experienced you are in traditional finance or how much you think you are exceptionally smart or favored by destiny, if you ignore risk management, you are likely to face failure.

The most effective methods of risk management can be summarized in two points: reasonable allocation of positions and investment portfolio structure.

(1) Reasonable Allocation of Positions

Regarding position management, I have already provided several detailed discussions in last year's e-book "Advancing Blockchain Thinking." Interested friends can refer back to the historical articles. As shown in the picture below.

(2) Investment Portfolio Structure