From 20,000 to nearly 1 million in a year: A review of Bai Ding's personal investment experience
Author: Bai Ding
Here, I will share all my investment experiences from the past year.
At the beginning of last year, I had over 20,000 yuan, and now I have nearly 1 million. I don't think this dozens of times increase is due to luck; it comes more from my average of over eight hours of investment research every day, as well as my work in the crypto industry. Compared to ordinary users, my information may be 100 times more (not an exaggeration; you'll understand after reading the text), so the ways I know to make money are things that ordinary users may not have even heard of.
Little money can be made on exchanges
In the early part of this year, my assets grew from over 20,000 to 200,000, but none of this money was made on exchanges. Why?
First, it's important to clarify a concept: the crypto market is not just about buying and selling cryptocurrencies on exchanges. If you only know about exchanges, theoretically, the only way to achieve high returns is through contracts. But this is only theoretical; it's needless to say that very few users can avoid losing money in contracts—less than one in a thousand in the market. This doesn't need to be debated because I have a much deeper understanding of exchanges than ordinary users. That one in a thousand is absolutely true; without users losing money on contracts, there wouldn't be the wealth of crypto billionaire Zhao Changpeng today.
So how did I make my first pot of gold? In the on-chain world.
As shown in the picture, our assets originally existed in the first layer—the real world. If you want to participate in crypto trading, you need to deposit money into the second layer—the exchange. But in reality, the second layer exchange is just a bridge, not the endpoint. The real high-return methods are in the third layer—the on-chain world, where there are various different forms of play beyond just trading coins.
The coins on exchanges also come from the chain. When a certain coin on the chain develops to a certain scale and has a large enough market cap, it will be listed on exchanges. However, there is a problem: when its market cap is large enough, it won't be able to increase several times, which is the reason for the low upper limit of returns on exchanges. Therefore, all the coins I mention later are also on-chain and cannot be found on exchanges.
So why is it so difficult for ordinary people to make big money in the crypto market? Because they don't know the on-chain world and can only play with what’s left by those who play on exchanges.
So why are on-chain returns so high, yet most people do not participate? It's simple: first, the operation is slightly more difficult; second, unlike exchanges that list all tradable assets, you need to gather information yourself; third, the risks are higher, requiring sufficient investment research capability.
First pot of gold stage
I started with 20,000 to 30,000 yuan, dividing this money into three parts for conservative, aggressive, and speculative investments. Ultimately, the speculative part brought my funds to 200,000 yuan. Looking back, this was the first stage of my crypto investment, and I regarded this 200,000 yuan as my first pot of gold.
By the way, let me mention the first two parts—they hardly made any money.
Conservative part: I bought Ethereum at around 2,200 dollars and invested in the then-popular Blast airdrop. The result: Blast's returns were far below expectations, almost negligible, but Ethereum rose to 4,000 dollars. I made about 10,000.
Aggressive part: At that time, I had already started investment research, but first, my time was too short and my skills too low; second, I wasn't working in the industry, so I lacked information. Thus, I only chased market hotspots and ended up buying TURT and MUBI (launch platform and stablecoin platform) at nearly the peak. Now, I've basically lost all of it. The continuously falling coin prices had a significant psychological impact on me, as this accounted for almost a third of my total assets.
Now let’s focus on the speculative part. I learned quickly and worked hard, and at this point, I had developed considerable investment research capabilities. The returns from the speculative part were also divided into three blocks: Troll, Sync, and the Merlin ecosystem.
On January 9, 2024, Musk changed his X account bio to "(CTO) Chief Troll Officer." We know that Musk can create a hundred billion market cap Dogecoin with just a tweet, let alone change his Twitter bio? So when I heard this news, I bought Troll tokens and later added some, totaling about 1,000 yuan in principal. Soon, the news spread, and within half a month, Troll dropped two zeros (a hundredfold increase). I wasn't the first to buy in, nor did I sell at the peak, but I still achieved a return of about 60-70 times, making a profit of around 60,000 yuan (after deducting gas fees, which were quite high at that time).
Sync was around February to March 2024. It is a staking profit token. Now everyone knows that I excel in economic model analysis and have established a comprehensive economic model analysis system; this ability was already beginning to show at that time. I recognized that Sync was a standard "short-term sharp rise and fall model," which I won't elaborate on here; you can refer to the picture below.
In simple terms, such a model can rise many times in a short period, but as soon as there is any downward trend, it will quickly drop to zero. At this point, I had developed certain investment research capabilities, so after studying the project, I bought in 2,000 yuan at a low point and held it for about a month. It originally rose about 60 times, but because I still couldn't achieve the unity of knowledge and action (greed got the better of me), I didn't sell at the first sign of a drop. As a result, it was halved the next day, and I hurriedly sold out, achieving about 30 times the return, around 60,000 yuan. A friend in the group followed my buy but didn't sell (it dropped even more later), but he still made a decent profit in the end.
After these two profits, I became confident, at least psychologically recognizing my investment research capabilities. Then came Merlin, which was my most complex analysis and operation.
The entire logic was quite complex; I will only briefly mention that Merlin is a second-layer network in the Bitcoin ecosystem. After research, I found its technology to be extremely poor (multi-signature cross-chain, and most of the multi-signature keys were likely controlled by the founder himself), while it also had exceptional marketing capabilities. Such a project is likely to either short-term or soft rug pull, and the facts proved this to be true. However, projects like Merlin, due to their strong marketing and high visibility, are very suitable for entering at the right time to profit.
Before the Merlin chain went live, it first pumped a series of NFTs it issued—BRC420—to extremely high prices, such as blue boxes, blue ores, etc. (old players should remember). Then Merlin induced everyone to stake these NFTs for airdrop profits; note that staking means you can't sell. At that time, I speculated that Merlin might be collecting everyone's chips and then dumping a large amount, directly crashing the high-priced NFTs to profit, and at that time, no matter how much they dumped, users couldn't sell because they had already staked, only able to watch and cry, which is "closing the door to beat the dog." The result was just as I guessed. At the same time, I speculated that after the Merlin chain went live, it would definitely pump some Memes to create a wealth effect to attract participation, then dump to profit—this is basically what every new chain does.
Based on this analysis, my approach was to buy NFTs but not participate in staking, selling them when there was a slight downward trend; at the same time, when the Merlin chain just launched, I bought its leading Memes—Huhu and Voya—and sold at the peak. The results were basically consistent with my analysis, and I made a profit, but this time it was only a few times. However, since my principal had accumulated by then, my income was also close to 100,000 yuan. Below is an excerpt from my analysis article on Merlin's operation at that time.
At this point, I had about 200,000 yuan.
Subsequent investment stage
At this point, investing had become simpler for me for three reasons:
With more capital, I no longer needed to pursue excessively high returns and had more options. I could just follow the macro trends.
My investment research system was becoming more refined; the later "economic model analysis system" was basically fully formed during this period.
I entered the web3 industry for work. Being a user and a practitioner is completely different; I can access information that ordinary users cannot.
Regarding the first point, let me give a simple example. When Blast first launched, I bought three NFTs of a racing game on that chain at an average price of 0.4 ETH each (the price was about 10,000 yuan at that time) and sold them at 0.66 ETH, not even doubling my investment. This is something I wouldn't have considered when I could only invest 2,000 yuan, but now I would participate because a 50% return is already quite considerable.
The second point is the essence of my entire thinking system and the main guiding philosophy for my subsequent investment returns. Through this economic model analysis system, I can find tokens that can be invested in for the long term from thousands of options (I don't trade contracts and rarely do short-term operations). Here’s a chart of the average cost of my main assets at that time. Those familiar with my economic model system know that I regard Curve as a benchmark for a long-term sustainable economic model. I also heavily invested in Curve and obtained considerable returns (this was last year; do not try to apply past strategies blindly).
As for the third point, it shouldn't be discussed in public media; I can share it if there's a chance in the future.
By December of last year, since I have an economics background, I comprehensively assessed the market from macroeconomic perspectives, technical aspects, and discussions with some knowledgeable friends in the industry, and I speculated that the market had peaked. I liquidated all my assets and held USDT, and since then, my position has never exceeded 20%.
At this point, my assets had just reached 1 million. Later, due to fluctuations, it retreated a bit, but not much.
Summary and future investment plans
Objectively speaking, I have a considerable talent and enough effort in learning new things, which is the source of my first pot of gold. My foundation in macroeconomics, a more comprehensive information source, technical knowledge acquisition, and the ability to control greed and liquidate in time are the reasons for my subsequent investment success. Let me add: whether or not you listen to me, for users trading contracts, I still don't trade contracts. If you don't have my background in economics, information sources, understanding of blockchain underlying technology, and mindset, why do you think you can make money trading contracts?
Future investments: I will look for a suitable opportunity, such as after tariffs are fully implemented or when prices drop low enough to re-enter the market. With the increase in capital, I will allocate 60% of my funds to mainstream coins like Bitcoin, ETH, and SOL, 20% using my economic model analysis system for suitable larger market cap altcoins, 10% will continue to seek on-chain opportunities like before, and finally, I will keep 10% in cash as a reserve. I believe this is not conservative but rather a reflection of a year of experience, seeing the mountains as still mountains.
Other future plans: The year of experience has not only been about capital; continuous learning of web3 technical knowledge has gradually allowed me to stand out in the web3 industry, providing me with more non-trading means of profit. As your ecological position rises, your means of profit will become increasingly diversified. For example, if Zhao Changpeng wants to make money, he doesn't need any trading; he just needs to shout orders on Twitter to sell. USDT also doesn't need any trading; it can earn nearly 100 billion RMB a year just by putting everyone's dollars into U.S. Treasury bonds, a completely safe place to earn interest.
Additionally, I hope to use my investment experiences and insights to help more people, but I am not a saint; I still consider myself. The reason is simple: this can make me more influential, and the industry better, so I can do better.
