Do You Really Know What DYOR Is?
I Thought I Was So Smart
Damn you, cryptocurrency market! I thought I was so smart buying in a week and a half ago when I thought the market dropped and it just keeps dropping. I am as invested as I want to be. However, I ask myself the same question on everyone's mind: will the market rebound? If so, when?
It Will Bounce Back
I think it will, but when? Some people see this as an amazing buying opportunity, but what if the prices drop again in a week or two weeks? I have a few dollars in savings, but do I want to risk them all during a time when my other investments (Nasdaq, S&P) are also tanking? (No. I do not.)
Every time the crypto market has looked bleak, ugly, and depressing in the past, there has come a time that those "depressing" prices have bounced way up. However, at the same time, some altcoins do not make it. I don't know whether it takes a genius or an idiot savante to know which ones will be okay. I think a set of dice, tarot cards, or a crystal ball are as useful tools as any other DYOR, but that might account for my lack of profound wealth.
What is DYOR, Really?
Seriously, though, I read this DYOR all over the place. But, how does one DYOR? Look at the market cap? The trading volume? The cute little icon? Some people say the team behind the project should not be anonymous (although there are legit projects that have made me money with anonymous teams). Others say you should look at the level of centralization or token distribution (both of which can be advanced to research).
Some people just read articles or watch YouTube videos, but that seems like an invitation to shillers and scammers. There is sometimes a complex network of people pushing a coin and they all have an agenda.
Whitepapers: What are They Good For?
Then there's the whitepaper and/or the litepaper. I don't want to be crass and say what I think whitepapers are good for. I have a degree in computer science and, most of the time, whitepapers make little to no sense to me. So, allow me to be like that child in the story "The Emperor's New Clothes" and say that whitepapers tell us little if anything.
What's wrong with whitepapers? First of all, many times, they are full of hype and promise -- here are the amazing things we will do! However, they don't always say when or how they will do these things.
I could easily make a website and write a whitepaper that says I will use a spinning wheel that I designed specially to spin straw into gold. Invest early! Ha ha.
Seriously, that is how many whitepapers seem to me. Some are slick marketing documents. Others are technical briefs (or not so briefs). And some are more detailed and comprehensible than others, of course. There are people whose whitepapers are not just complex smoke and mirrors.
I am invested in Wonderland Time. It might be a bad example because I keep waiting for the other shoe to drop, wondering if it is a scam. I read their whitepaper. It made no sense to me.
What Does It Mean When Something Seems like Nonsense?
When something makes no sense, people often assume they were not smart enough to understand it and so they don't admit it. I try to ask myself whether I need to learn more, ask someone smarter to explain it to me, or whether it just did not make any sense. It's often hard to know. This is especially true if the author of the whitepaper is skilled in the art of obfuscation, which most of them seem to be.
I read a post in the cryptocurrency subreddit a couple of months ago that compared projects based on their whitepapers. It was an interesting post until I realized that the author had not actually read the whitepapers. He was comparing their surface readability and complexity. This made me wonder if anyone does a serious read of these whitepapers, despite what people say.
I am not a genius, but I am reasonably intelligent. My computing skills are rusty, but I know much more than the average Joe. I think, honestly, if most whitepapers go over my head, I don't know if most people would understand them. Maybe that is an arrogant assumption. I suspect it is more likely that these papers are deliberately obfuscated. Either way, they seem like a poor and biased tool in DYOR.
Conclusion
In an unregulated industry rife with scams and volatility, what is left? How does anyone DYOR? Do people have methods that I simply don't know about?
I think DCA (dollar cost averaging) is a winning strategy, but, sadly, I don't have any further funds for investment. Even if I did, I would need funds to invest on a regular basis, which I don't have at the moment.
However, maybe that can be a goal for 2022: to come up with a way to find a small amount of money to invest on a weekly or other regular basis.
Meanwhile, like everyone else, I wonder how much colder this crypto winter will get. I am grateful that I don't require my funds in the near future and can afford to HODL.
By the way, if you have a brilliant DYOR method and you are sitting there thinking, "Harlow, you are doing it all wrong," please tell me. I am open to correction! I would love to know what I am doing wrong. It's always upsetting short term to realize that you have been totally messing things up, but, long term, it is better to realize your errors and change your strategy. That is how I see it, anyhow.
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Image created by the author in Canva.
In reality, I think despite anyone's 'research', people are totally relying on this being a fairly new world in which we will slowly see gains as more people buy into the crypto world.
I personally shunt funds in and out of stable coins when I've made a little profit and then when I 'think' the market has temporarily bottomed, buy back in. Watch and repeat. Watch and repeat
I read little into white papers as they are nothing more than wanna do works of fiction written by techies who usually have very little business or financial acumen.
I often invest in shiny new things because the tendancy ia for people to get excited, lump in. Prices rise, incomes soar and then I quickly leave with a little profit when as soon as prices show the first signs of dropping and APRs fall. Something new will always be around the corner.
Other than that, I look for coins with tangible projects which are undoubtedly making progress and limit myself to a very small portfolio.
The space is so full of bullshit, dreamers and market manipulators that at the end of the day, it's complete guesswork. Don't even start me on people who use charts!
Treat it all as a game and never invest more than you can afford to lose. Old truths of traditional financial markets still apply where your portfolio ought to carry a majority of 'safe' investments, a lesser percentage of slightly riskier investments and a smattering of high risk for investments.
There is also the scattergun approach which had paid dividends for some people where you have a little bit of everything in the hope one of them takes off. The old style Fiat equivalent of this would be the oldstyle penny share investors!
I have no idea what I'm doing either though so don't beat yourself up lol ;-)
Very sensible advice. I guess you are doing all right then. 😊 Best wishes.
@khing.khong, take note
Thank you brother Atma 🙏
Markets like these get split into Pool A and Pool B speculators where Pool A ultimately profits and Pool B ultimately loses. The entire market is driven on this and Pool A people will rarely share valuable information with Pool B people because that's where their profits come from. We can pretend like there's no secret but if that were true and it's all just guessing then you would see more Pool B speculators pass the threshold into Pool A but Pool B speculators mostly stay in Pool B or exit the market entirely once they have suffered enough losses. The problem is that everyone looks like a genius in a bull market so it takes some time for Pool B to realize their lot and can easily get caught up in a sunk cost fallacy once they do.
At this point, I think I should pay hive for using the plateform. No university degree can tell us what you wrote in simple layman terms. I appreciate your comment.
The irony of some of your statements are poetic to me. I can simplify for you. The post was trying to make it sound like everyone who trades is just guessing and getting lucky or using some form of mysticism to pretend to know it. Like reading your horoscope. This is not true. There are techniques that are successful but the trading culture people see is very lazy. The useful stuff is not very public because people who make money want other people to lose money so they make more money. Does this make more sense?
Believe me I did get it. I was using mobile in front of my sister and she got a gold medal in economics in her graduation time. We both appreciated your comment. You highlighted a unrated area of economics very well. Maybe it sounded like I don't tell u behind the scenes or non native English speaker???
Even now my personal self the condition of our universities here is that we learn more things on hive sometimes then the teacher lectures. Maybe u found it poetic because I failed to deliver my message of what I am thinking in brain in English.
I wouldn't put Hive on a pedestal the way you do. Hive being what it is amplifies the problems I've stated. Universities are designed with a form of exclusivity. I don't want to dismiss them because they have their function but the very nature of the institutions will always create these disconnects while having the new problem of constantly being behind the times as emerging industries pop up overnight in the era we are in. Hive is problematic in the opposite direction while also having major issues with exclusivity so it has somehow managed to struggle on both ends of the spectrum.
Hmmm... so, do you see yourself as Pool A or Pool B? How does the non-tarot-card-requiring pool get its information?
The disturbing part about what you have said is that, basically, it makes Pool A sort of like a Cabal, and no better than big banking, etc.
Information is currency