You have definitely experienced moments like these: you correctly predicted the direction of BTC, but when you held a heavy position through a $2000 pullback, you panicked and finally sold at the lowest point; or even though you knew it was just a small fluctuation, you still went all-in with 25x leverage, and when the market moved against you, you got liquidated—only to realize in hindsight that the direction was right, but your position from the start had locked you in.

The crypto world has never lacked people who get the market direction right. What’s missing are those who live to see the moment of wealth explosion. Too many traders treat their positions as a stepping stone to amplify their dreams, always aiming to go all-in once to earn ten times, but they overlook a harsh reality—crypto markets fluctuate 20% in 24 hours, which is nothing for high leverage and heavy positions. Even if the direction is correct nine times out of ten, the tenth reversal can wipe out your account.

Do you remember that trader? Peak unrealized gains of $45 million, enormous paper wealth. But because he held on with 25x leverage, his entire account was eventually reduced to just $1,718. The same story replayed with James Wynn—$4.8 million position evaporated overnight. The reason for their failures is eerily similar: they both forgot to install a "brake" on their positions.

Those traders who truly survive and earn steadily in the crypto space have long understood a key logic—first ask yourself, "How much can I lose at most?" before asking, "How much can I make?" Positions are not tools for gambling; they are defensive lines for risk control. When your position size is set correctly, even if you get the direction wrong once, you still have a chance to turn things around; if your position is set incorrectly, even a correct market direction can lead to a fall.

On a practical level, there are several ironclad rules about position sizing worth remembering:

**Rule 1: When uncertain, try with a small position**
When BTC is oscillating repeatedly in the 86,000-90,000 range, new coins just listed on exchanges, or the news is still unclear, never go all-in. Use a very small proportion of your total funds to test the waters—that’s called "scouting," not "all-in." Only after confirming the trend should you increase your position—this is the smart approach.

**Rule 2: High-risk assets must be kept with small positions**
Small coins and highly volatile contract products inherently carry the risk of sharp drops. No matter how optimistic you are about these assets, keep your position within a tolerable range.

**Rule 3: Pyramid-style position building**
Enter with a small position first, confirm the trend, then gradually add more. Don’t go all-in at once. This way, you can catch the trend and leave room for adjustments.

**Rule 4: Setting stop-losses is not admitting defeat, it’s survival**
Pre-calculate the maximum loss you can tolerate on this trade, and exit if it’s reached. It sounds simple, but few people actually follow through. Stop-loss isn’t about admitting failure; it’s about reserving ammunition for the next opportunity.

The deeper your understanding of the underlying assets and risks, the more cautious you become. Because you realize how costly high leverage and heavy positions can be.