In the cryptocurrency world, are there more people making money or more people losing money?

币上皇ETH · 2023-07-23T16:37:43.000Z

I haven't done statistics, but there is a high probability that many people are losing money. If the statistics are based on some old people in the currency circle, it means that there are actually more people who make money. For example, group friend Ling found a gate account from 3 years ago with hundreds of thousands of doge in it, and she made a profit. Group friend Luo used 5,000 knives to attack local dogs. He made 20 of them, 16 of them returned to zero, one was 100 times, one was 10 times, and several were doubled. He also made a profit. Group friend Li, when he only had a loss of 1,000 dollars, he found a unilateral market 20x rolling shuttle, and he also made a profit. But in these statistics, survivorship bias is too obvious. In the years since the birth of Bitcoin, too many people have entered the market with the mentality of taking a gamble and then left the market with losses. These people are just no longer around us.

I haven’t done any statistics, but it’s likely that more people lost money.
If we count the old people in the cryptocurrency circle, then there are actually more people who make money. For example, group member Ling found a gate account from three years ago with more than 100,000 doge in it, and she made money. Group member Luo used 5,000 dollars to buy 20 doge, 16 of which returned to zero, 1 100 times, 10 times, and several doubled, and he also made money. Group member Li, when he had only 1,000 dollars left, found a one-sided market with a 20x rolling shuttle, and he also made money.
But these statistics show a very obvious survivor bias. In the years since Bitcoin was born, too many people have entered the market with a gamble mentality and then left with losses. These people are just not around us anymore.
From the perspective of trading, it is very difficult to make money. Ordinary people without relevant experience and knowledge can easily lose money. Assuming that your trading winning rate is 60%, that is, there is a 60% probability of making 50% profit and a 40% probability of losing 50%, can you make money steadily?
The answer is not necessarily. Suppose you have $10,000 and go all in every time for 10 times, get 6 correct and 4 wrong, the result is 10,000x1.5x1.5x1.5x1.5x1.5x1.5x0.5x0.5x0.5x0.5=7119
The result is shocking, right? Do you think this is a zero-sum game, so if your winning rate is 51%, you can make money? No, no. If you don’t know how to manage your positions and go all-in every time, even if your winning rate is 60%, you will still lose money in the long run.
What if you bet the same amount every time in this situation? $10,000, $1,000 each time.
The result is 1000x1.5x6+1000x0.5x4=11000
Ok, you can make money in this case, but you have to strictly abide by trading discipline.
Of course, real-life trading is definitely not that simple. I am just giving an example to illustrate that even if you have a high winning rate, it is actually difficult to make money.
I wonder if the person who asked this question was out of curiosity or jealous of some early investors who made more money. In order to answer this question, I actually asked a circle of people around me who play coins. Surprisingly, 80% of them made money. Why is this so? Because it is a bull market now. As long as you are still alive in this market, you will make money more or less in this bull market cycle. Livermore has such a story in his "Reminiscences of a Stock Operator". At that time, there were many shell securities companies in the United States (no real transactions were made in the stock market, only bets with customers). In the bull market, everyone was long and everyone was making money, so the shell securities companies went bankrupt one after another. In this story, whose money did people make? It is easy to judge here that people make money from shell securities companies, but in a big bull market cycle, why are all people making money? Whose money are they making? What about the promised zero-sum game?
So why is everyone making money during a bull market? Because no one cashes out?
You should be able to understand it if I give you an example.
Suppose there is a person named Xu Xu Baby, who plays dnf and creates an account, spending 20 million yuan. Then when he quits the game, he sells it to Zhang San for 1 million yuan. Zhang San plays for a month and sells it to Li Si for 1.5 million yuan. Li Si plays for a month and sells it to Wang Wu for 2 million yuan. Then the game changes its version and the price of the original account plummets. Wang Wu sells it to Jia for 1.9 million yuan, Jia sells it to Yi for 1.8 million yuan, Yi sells it to Bing for 1.7 million yuan, Bing sells it to Ding for 1.6 million yuan, Ding sells it to Wu for 1.5 million yuan... Finally, Xin sells it to Ren for 1 million yuan.
I would like to ask, in this process, who made money and who lost money? Who cut who and who was cut by whom?
Did Li Si make 55% of Wang Wu's money? Did Li Si make 500,000 yuan from Wang Wu? But Wang Wu obviously only lost 100,000 yuan? Who is making money from whom? If you read it several times and deeply understand the logic here, you should be able to figure out that Zhang San and Li Si are indeed making money in the rising cycle. The money they make is realized quickly for themselves, but the money lost by A, B, C, and D will take a long time to be recovered. This is why the bull market is short and the bear market is long. The people behind have to go through a long process of holding and cutting losses.
Back to the topic of the cryptocurrency circle, those who entered the market early would have basically made money today if they had honestly played spot trading and bought mainstream currencies. In this market cycle, there are still many people around me who are making money, but some of the money they earned has been cashed in, some has not yet been cashed in, some has generated faith, and some is just speculation.
People outside the circle criticize the cryptocurrency circle as a big casino, while people inside the circle just laugh at others for not seeing through it. They just think that as long as sovereign states continue to print money and Bitcoin remains controversial, more people will enter the market with several times more banknotes and existing people will increase their positions with more banknotes, and that's enough.