Introduction
I would like to take a moment to thank J and L from BingX for their invaluable support and guidance throughout my journey. While I am unable to reveal their identities, their help was a key factor in my decision to select BingX. After evaluating various CEX exchanges, I ultimately chose BingX, driven by the belief that careful selection is more important than sheer effort. Please note that this article is not intended as investment advice—this is something that everyone already understands. Let’s skip the disclaimers and dive straight into the point—selection outweighs effort.
Trading is all about decision-making: choosing what to invest in, when to enter, and when to exit. These are the decisions that shape your success. One of the most significant differences between cryptocurrency and traditional stocks is that crypto demands quicker decision-making.
In different market conditions, making the right choices can lead to vastly different results. For example, when market conditions are uncertain, the best option is often to minimize losses. However, most traders, especially 99% of office workers, continue trading in the hopes of making profits. But when market conditions are not favorable, opposing the market will almost certainly result in losses.
The key to reaching $1 million lies in making the right decisions and making them quickly.
1. Selection Over Effort: The First Step to $1 Million – Coin Selection
When it comes to crypto spot trading, there are three categories: 1. Bitcoin, 2. Altcoins, and 3. Meme coins.
How do you make the right choice? Selecting the right coin is crucial. Many traders fall into several common misconceptions that result in continuous losses:
- They believe crypto offers quick wealth and, seeing Bitcoin’s slow growth, they move to altcoins. When altcoins fail to provide the expected returns, they turn to meme coins, which are even more volatile. In the end, they trade across all categories and lose everything.
- After hearing about an influencer making millions from meme coins, they follow suit, only to face significant losses.
Research shows that over 80% of traders in the crypto space lose money because of poor coin selection.
Bitcoin, altcoins, and meme coins have different risk levels: Bitcoin < Altcoins < Meme Coins. These risks are inherent, and it is critical for each trader to assess their own risk tolerance before selecting a coin. In other words, self-awareness is key to making informed decisions.
1.1 Risk Tolerance: Understanding Your Limits
If you have a low risk tolerance, volatility in the market can cause significant anxiety and discomfort. When you exceed your risk tolerance, you may find yourself making impulsive decisions that dramatically increase your chances of losing money.
Can you trade beyond your risk tolerance? Yes, but only if you believe there’s a high probability of success (over 60%).
Once you make a decision, there’s no turning back. You must be prepared to lose all your capital if things don’t go your way. For example, if your risk tolerance is $1,000, and you decide to invest it all in high-risk meme coins, you must be ready for a total loss.
Many traders believe that turning $1,000 into millions is possible, but they fail to deal with the psychological pressure of losing it all. If you’re prepared for the worst, borrowing money to continue trading is a common outcome.
Traders often borrow not because they lost all their funds, but because they want to leverage the profits they’ve already made.
1.2 Choosing the Right Path: Bitcoin < Altcoins < Meme Coins
The risk levels of Bitcoin, altcoins, and meme coins depend on the kind of information you can access. So, where can you get reliable information?
- If you have connections with hedge fund managers and top industry professionals, trading altcoins could be highly profitable for you.
- If you have influential friends, such as KOLs or celebrities, even someone like Elon Musk, trading meme coins could be highly successful. However, these should be real, personal relationships—not just people you follow on social media.
Why are personal connections important? They allow you to receive insider information before it hits the public.
If you don’t have these connections, the best strategy is to allocate 80% of your capital to Bitcoin and focus on solid market analysis to form your own insights.
Platforms like Binance Plaza are inefficient for my needs because there’s too much noise. Instead, I focus on analyzing the Bitcoin price on BingX to quickly grasp the market’s direction.
This approach is about making profitable moves with the available data, rather than wasting time.
2. Selection Over Effort: The Second Step to $1 Million – Timing
While many people believe Bitcoin follows a fixed four-year cycle, this is a misconception. The chances of perfectly timing market cycles is a mere 0.06%.
So why does Bitcoin seem to follow this cycle? It’s not due to mining halving—it’s because of liquidity, also known as “hot money.”
Every four years, U.S. elections pump liquidity into the market, inflating asset values in a predictable cycle, aimed at satisfying voters.
The secret to timing the market is understanding when liquidity enters or exits—this is the core principle of investing.
2.1 Liquidity and Timing the Market
Markets are driven by human behavior, and people’s actions are hard to predict. A more effective approach is to track liquidity.
Meme coins often surge because they act like balloons, inflating rapidly when liquidity enters the market. However, every financial crash has occurred when these “balloons” burst due to excessive liquidity.
The key to good timing is knowing when these balloons will expand or pop. That’s why I prefer using BingX, which already conducts in-depth research on coins before listing them.
Even with in-depth research, altcoins can still fail. That’s why proper position management is crucial, such as limiting your exposure to new coins and using automatic buy/sell orders.
3. Selection Over Effort: The Third Step to $1 Million – Position Sizing
Position sizing is a fundamental concept in trading—how you manage your capital can determine your success.
Many traders lose money because their final actions contradict their strategy. For example, an investor with a $1,000 risk tolerance might decide to invest all of it in high-risk meme coins, treating it as a gamble.
Proper position sizing means understanding how much risk you can absorb. If you can withstand 100 losses, you should only risk $10 per trade.
Since short-term price movements are difficult to predict, Copy Trading is an excellent strategy to manage risk. After experimenting with different platforms, I returned to BingX because of its pioneering Copy Trading feature.
Top 5 Exchanges
1. Coinbase: Fast bank transfers but high fees.
2. Binance: Facing challenges due to regulatory issues.
3. Bybit: Strong in contract trading but lacks long-term potential.
4. OKX: Large volume, but lacks a unique competitive edge.
5. BingX: Best for coin selection and accurate market timing.
