Crypto Survival Guide: From "Closing Your Eyes" to "Making Fewer Mistakes"

Perhaps the best way for us to succeed in the long term in our investments is not to make mistakes, not to make wrong investments, and not to have bad years.

Written by: Blockchain Knight

Since BTC broke through $100,000, the entire Crypto market has ushered in a continuous 3-month decline instead of climbing, and the most seen word recently is "returning to poverty", and many players who have benefited well have also fallen into new struggles.

On the one hand, the BTC ETF has entered the historical stage with great fanfare, and on the other hand, the extreme deterioration of the market, in the face of such a bad market, if you want to survive the ups and downs, you can no longer have the same thinking as in the past few cycles, because we have to admit - the market has changed.

So in the face of the current market that wants to scold X, how do we survive? The author has recently seen some good views and reflections, and I would like to share them with you here.

Let's think about a question first: in a high-level tennis match at a Grand Slam level, is it the skill or the mentality that is important, and if it is an ordinary amateur player, which is more important?

To answer this question, Dr. Simon Rameau, a scientist and statistician, has written a book on tennis strategy, "The Extraordinary Tennis of the Average Player".

Through long-term observation, he discovered that there are two forms of tennis: one is the competition between professional players and a very small number of talented amateur players; The other is a competition between ordinary amateurs, and although they use the same equipment and follow the same rules, they are very different in nature.

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After a systematic study of scientific statistics, Dr. Rameau concluded: professional players win games by scoring actively, while amateurs keep losing points due to mistakes. The pros unleash long, exciting strikes with precise and powerful shots, and keep their opponents out of position to score. These top players rarely make mistakes, and their matches are a "winner's game" where victory depends entirely on the positive actions of the winner, and victory means not only scoring more points, but also suppressing through active scoring.

Amateur tennis, on the other hand, is in a completely different state. Brilliant shots, thrilling endurance and miraculous saves are hard to come by. On the contrary, the ball frequently touches the net and goes out of bounds, service errors are common, and amateurs rarely actually beat their opponents, but they are always self-defeating. The reason why the winner of this type of game scores more points is often because the opponent makes more mistakes.

Dr. Rameau tested his theory in an innovative way: he moved away from the traditional scoring system and instead counted the ratio of points scored to points conceded, with data showing that 80% of points scored in professional games came from active offense, while 80% of points scored in amateur games came from opponent errors.

This means that professional tennis is the quintessential "winner's game", where the outcome is determined by the winner's performance. Amateur tennis is a "loser's game", where the outcome depends on the number of mistakes made by the loser, and the two types of matches are very different in nature.

Based on this discovery, Dr. Rameau constructed a complete winning strategy: the average player only needs to follow the simple tactic of "reducing mistakes and inducing the opponent to self-destruct" to consistently win the match.

He made it clear that if the goal is to win rather than play, the core strategy should be to defend steadily, maintain the success rate of the shot, and give the opponent plenty of room to make mistakes. After all, amateurs are often caught in the "loser's game" without realizing it, and will eventually lose in self-consumption.

In his book, Dr. Rameau reveals the essential difference between a "winner's game" and a "loser's game": the so-called "winner's game" in which victory depends on skill beyond expectations, while in the "loser's game" victory depends on making fewer mistakes than other players.

Dubbed "the smartest man on Wall Street" by Caijing magazine and one of the leading figures in the investment industry, Charles Ellis classified modern investing as a loser's game and wrote a best-selling book, "The Game of Winning the Loser".

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As Ellis says in the book, investing is like playing tennis, where the winner will get better long-term performance if he makes fewer mistakes, while the loser will end up losing money because they make the same mistakes over and over again. No one can avoid making new mistakes, but successful investors repeat old mistakes less often.

Going back to the Crypro market, it used to be a winner's game, and it took above-average skill to participate and win. But today, the crypto market has largely evolved into a loser's game – make fewer mistakes and just survive to win.

So the logic becomes, we just need to do nothing out of the line when everyone else is crazy about PvP or crazy leverage, and we can greatly increase the probability of winning in this game.

That's why a few years ago the market just had to close your eyes when the bull market came to make a profit, but now it's not at all, because the game has fundamentally changed. More than 90% of the players in the market don't need to be clever and strategic, and it's important to reduce the frequency of mistakes and mistakes to achieve above-average gains.

As Howard Marks, the founder of Oaktree Capital, said: "For me, the best way for us to be successful in investing for the long term is to not make mistakes, not to make wrong investments, and not to have bad years." As long as you accumulate a good investment one by one, as long as the performance is stable year after year, 20 years, 30 years, 40 years, 50 years, in the long run, it will be a successful investment career.

Above, all encouragement. Hopefully, we can all get our own victories in this game.