The Apex of Ponzi Coins - the 4403 of them - Part 1

More coins than stocks listed on the S&P 500

Where do we begin to navigate the new landscape

There is an old adage, "scared money don't make money," and for the most part its true. When you open a trade or start an investment, you do it with conviction. You can't hem and haw, buying and selling the position back and forth, and as you've learned by now, there are no refunds.

Your opinion is that the position appreciates, whether long (bull) or short (bear). Fear can be your single greatest enemy, but it can also save you from yourself. A lot of people tend to fall in love with an investment.

There is no room for apathy and a lot of the time, the position turns south and people resign to a HODL trade (Hold On For Dear Life). Is that really winning? What are we here to do? Grow our wealth, not lock in for a, 50/50, hold your breath for god knows how long, position.

What if you understood the fear, listened to your own apprehension? You might get out of a bad trade, you might preserve capital, you might have the capital to jump onto the right train. I learned early on to not just resign to the idea of being fearless because that question in my gut, the back of my mind, that's instinct. I embrace fear the same way I embrace risk.

Just like trading conventional equities, stocks, a lot of the same principles, methodology and rules apply.

1. Never more than you can afford to lose.
2. Capital preservation is key to risk management.
3. Know what you bought. Especially investors, you really need to know what you bought.
4. Stay liquid and study market conditions.
5. Don't fall in love, especially with a ponzi coin.
6. STUDY - learn to read a chart, learn to read a balance sheet, learn to read a white paper.

So I have been meeting new people and making friends through steemit and on steemit chat. If we aren't talking about sex, we are probably talking about crypto or food. There are quite a few people who are very knowledgeable about individual blockchains and their respective cryptographic assets or understand trading and investment.

By the same token (that was a pun) there are a lot of people who know nothing about trading, finance or blockchain technology who want in or are trying to offer advice. On top of this, there have been an awful lot of snake oil salesman, pumpers and bashers.

Aside from the above rules, the single greatest favour your can do, is consider the ladder noise, but engage in thoughtful discussion with the former - Don't be the victim of fomenting.

So what do you buy?

With 4403 different cryptocurrencies, the real question is how do you decide? Especially with no experience or investment and trading acumen.

Just like with stocks, we buy market cap. Market capitalization, simply represents the total amount of a security in circulation multiplied by its current value, how much is a given security worth in total. The benefit of focusing your energy on cryptographic assets with a real market cap ($ billions) is you are playing where the money, where there is liquidity, where the risk is less.

Market Capitalization - Sub $1 million dollars - think OTC stocks, over the counter, pink slips. Sure there is the odd gem, but most are shit, garbage. Don't play these.

Market Capitalization - Several million to 100 million $ - Think small cap, penny stocks, explosive, but you will probably end up HODL'ing. If you can't understand the tech or read a chart, don't play these.

Market Capitalization - Several Hundred Million $ - Think mid cap stocks, safer, more predictable and far more liquid than -penny stocks and they still get a little oompf' - be nimble, study, you can play these.

Market Capitalization - Billions $ - Think large cap stocks(the apples, facebooks and amazons), they move markets, they are relatively safe, very liquid, and thats because that is where all the money is.

My view is that the majority participating in the new crypto paradigm should be sticking to the stalwarts and avoiding risk as much as possible in this new, extremely high risk, industry. All it could take is just 1 of the 4403 crypto currencies to fail and entire swaths of them could be wiped out.

Check out coins by market cap as part of your due diligence when ever you think about trading and investing. It's not about buying the cheapest coins its about making sound investment and trading decisions based on rules and research, STUDY.




This article is the start of a short series where I will try to explore simple concepts of convential capital markets that apply to the new sphere of cryptographic assets.

I look forward to your comments and thoughts!

If you are the victim of a ponzi coin, why not get the t-shirt.

<3 @satchmo