Letter 59: This is not the time to clock out
If you're still reading crypto newsletters, you're literally exceptional
Fortunes are sown in the bear, and reaped in the bull.
Be fearful when others are greedy, and greedy only when others are fearful.
The stock market is a device for transferring money from the impatient to the patient.
People love to throw around these quotes almost as a way to reaffirm their decisions to stick through down markets. I’m guilty of this myself, and there’s a good reason for it: they’re true.
Trading crypto (or anything, really) is most fun when number is going up-only. Even when number goes down a lot and up a lot and down a lot and up a lot, it’s still really fun (albeit terrifying and probably shaves years off lives). What is not fun, however, is when price goes slowly-down-only, month after month after month (after month after month after month).
That’s not quite where we are in the market right now, but it’s close, and if things continue the way they’re going for many more months then we’ll be there. MANY people have already checked out. They got bored; they got depressed; they gave up. It is very fair and very understandable that they left, but it is also an opportunity for those who stay.
One of my largest crypto regrets1 was leaving during the 2018-2020 bear market. I didn’t have strong conviction in crypto yet. I wasn’t convinced that Bitcoin and Ethereum would still be a thing in the future. I couldn’t conceptualize what smart contracts were or could do, it was all just theory to me — theory that largely went over my head. So, I missed buying ETH at $80 and BTC at $3k. That was the opportunity cost of my leaving.
I feel that a lot of people who are disengaging from the market now are making a similar “mistake”. And I get it. It’s hard to open your portfolio app every day and see red, day after day, week after week, month after month. It’s a hard pill to swallow, realizing how much you overpaid for things. It’s hard to accept that you bought a lot of things that will never recover. It’s very normal and understandable to give up. It’s what most people do.
But if you want to make it in crypto, in trading, in life, it usually doesn’t come from doing what most people do.
It comes from being exceptional.
Most people are not still opening crypto newsletters, I can guarantee you that. The open rate of this newsletter is noticably different in bullish times vs bearish times and I hear similar things from friends running newsletters. Twitter engagement also drops off a cliff as people continue to leave the space.
So just the fact that you are reading this right now gives you at a leg up over most people. This alone, of course, does not mean you’re going to make it. It does however mean that you have a much more likely chance of making it.
Whatever it is that that making it even means (we’ll get to this).
This newsletter will focus on 5 areas:
On opportunity
On growing the pie
On where to focus
On making it
Bonus: 5 more airdrops to consider farming
P.S for anyone that took the few minutes and completed the steps I highlighted for the Wayfinder airdrop in last week’s Newsletter, you should be eligible to claim some $PROMPT now, which you can do here: https://app.wayfinder.ai/wallet. You should receive around 300 tokens, worth about $135 USD at current prices. Not bad for a few minutes work!
On Opportunity
I’m not at all saying that you should be out there buying up the floors of all your favorite NFT collections or buying the dips of your favourite alt coins; or even that you should be buying anything at all. I do think, though, that you should at least be paying attention — and continue to pay attention — and at least consider buying the tokens you deem most valuable as the prices continue to drop. The lower they go, the cheaper they get, the better the potential opportunity.
If financial success is what you’re after, then this is not a bad time to be hunting for hidden gems. I’m not here to tell you what they are2, other than to say that they are out there. There are things that are down 95% that will recover. There are things out there that will 100x from here in price. If you have conviction, and a strong enough thesis, and a lot of patience, and a long enough time horizon, and perhaps a bit of luck.. there are insane opportunities all around.
Even if you’re not interested in hunting for gems, there are still endless opportunities all around. Networking is such an underrated part of this space, especially in bearish times. Crypto Twitter is like high school in many ways. It’s immature, there are cliques, there is bullying, people have fun, there is endless drama.
It is also like high school in the way that, five years from now, you’ll look around and go oh I went to school with that person who is now the founder of <insert wildly successful company here>. You could be on a Twitter space chatting with the next Brian Armstrong, the next Luca Netz, the next Jack Butcher, the next Snowfro. Heck, you could still be on a Twitter space chatting with most them even today.
Don’t underestimate the power of networking in this space. You never know where your future boss, co-founder, employee, best friend, or alpha group invite will come from.
On Growing The Pie
Before I got into crypto I was a professional poker player. I mostly played online, starting in 2005. In the early days, the community congregated on online poker forums and, by and large, everyone was extremely happy and willing to share tips and strategies to help each other improve their game. This was in spite of the fact that these were the same people they competed against at the tables.
We all realized that growing the pie was more important than fighting over the same pie. And the money was flowing easily, it felt more PvE (player vs environment) than PvP (player vs player).
At some point between 2005 and 2015, that changed. Poker alpha was given less freely and openly. More and more of it became gated, behind paid groups, subscription services, private coaching, and sometimes only shared within small friend groups.
I feel like crypto is somewhere in that 2005-2015 range right now. While yes of course there are paid groups and private avenues of content (the world has acclimatized a lot more to paying creators), there is still a lot of open and public sharing of great ideas.
Each year that went by, it became tougher and tougher to make it as a professional poker player.
Each year that goes by, it is becoming tougher and tougher to make it as a crypto trader.
The going is still good, and will probably stay good for quite a while still. But it’s not as easy as it was in “the good ole days”, and it’s not likely to get any easier as time goes on. This is the toughest cycle I have participated in (a sentiment shared by most people I know), and I have no reason to believe the next one is going to be any easier.
It’s cliche as hell, but this is literally and unironically the time to be locking in. Future you will thank you for it.
On Where To Focus
One of the difficult things about our space is just how much is always happening. Even now, in a choppy bearish market, it’s overwhelming to know where to dedicate your limited time and attention:
Do you go hard airdrop farming?
Do you spend your time building your personal brand and networking?
Do you focus on the latest meme coin trends?
Do you try and jump on the Abstract chain bandwagon?
Do you try and find new NFT projects that might perform well?
Do you try and find existing NFTs that are undervalued?
Do you keep up to date with the latest tech improvements?
Do you finally figure out how to provide liquidity in DeFi protocols?
Do you finally pay attention to blockchain gaming?
The possibilities are endless. They were endless in the bull market too, but somehow it was more palatable to be overwhelmed when number was going up. You could accept losing a bit of sleep, having a bit of stress, and feeling a bit of FOMO — as long as you could refresh your app and see green any time you wanted.
It’s a lot harder to stay engaged when that green is now mostly red. Why should you check in with the latest trends when it’s not gonna lead to any short-term profit? Why indeed.
You need to come up with your own answer to the question; to have your own conviction as to why you’re still here. It could be because you see the writing on the wall and that crypto will, eventually, be everywhere in the world. It could be because you’re passionate about digital art, or gaming, or DAOs, or DeFi. It could be because you want to make some great friends and connections. It probably is — at least in part — because you want to make money (might be worth reading my letter on making money in crypto if you haven’t yet).
Whatever it is, you have to come up with it yourself, and focus your time and energy on that, and try to ignore the noise. It’s difficult because there sure is a lot of noise.
But you simply can’t focus on Everything Everywhere All at Once.3
Next week’s newsletter will be specifically on the topic of curating your information flow, which will hopefully help in this regard!