How to avoid "making paper wealth, losing real money"
Did you make 1,000,000 in the bull market of 2021?
Did you make money on paper?
How much was left later?
To be honest, my account peaked at 800,000 (with a principal of 100,000).
What was the outcome? Didn't sell a single one, held on tightly, thinking "ETH can reach 20,000, SOL can reach 1,000".
When the bear market hit in 2022, my account shrank to 150,000, which is even less than my principal.
This isn't investment, it's a roller coaster ride, left with nothing.
Why did this happen?
Because I made the three most fatal mistakes in a bull market:
Chasing highs and cutting losses (driven by FOMO)
Not taking profits (FOGO mentality, always feeling it can go higher)
No risk control (all-in on a single coin)
👇 Today, let’s uncover all these pitfalls and show you how to avoid the tragedy of being a "paper millionaire."
Save this, it can save your life in a bull market. No joke.
Fatal mistake 1 - Chasing highs and selling lows (the essence of FOMO)
Let’s start with a scenario:
SOL rose from $20 to $50, and you think, "It’s too expensive, I’ll wait for a correction to buy."
As a result, SOL shot directly to $100, and you panicked: "If I don’t buy now, there won’t be another opportunity!"
So, $100 all-in.
And then? SOL corrected to $70, your account was down 30%, so you panicked and cut losses.
A week later, SOL rose back to $120. You slapped your thigh, cursing yourself for being impulsive.
This is FOMO (Fear of Missing Out):
It’s not about looking at the project’s fundamentals, but rather seeing others make money and feeling bad about yourself.
What is the essence of FOMO?
A mix of greed + fear. You’re afraid of missing out, so you buy at high; you’re afraid of losing, so you sell at low.
What about the results? Always buying high and selling low, giving money to the big players.
What to do?
Dollar-cost averaging (DCA): Buy a fixed amount at a fixed time every week, regardless of price changes.
For example, every Sunday at 8 PM, buy $500 worth of BTC or ETH, persist for 6 months.
This way, your cost price will be averaged out, so you won't incur heavy losses just because of one high purchase.
Remember: in a bull market, "slowly buying" is 100 times safer than "going all-in at once."
Fatal mistake 2 - Not taking profits (FOGO mentality)
In 2021, my ETH cost price was $1500, and when it rose to $4800, I made over three times on paper.
A friend advised me: "Sell half, at least get back your principal."
I said: "ETH is about to reach $10,000, isn’t it foolish to sell now?"
What about the results? In 2022, ETH dropped back to $1000, and I not only didn't make a profit but also lost money.
This is the FOGO mentality (Fear of Getting Out):
It's not about being afraid of not buying, but rather being afraid of selling too early and missing the subsequent surge.
FOGO is more deadly than FOMO.
Why? Because FOMO makes you lose money, and FOGO makes you give up all profits, even incur losses on your principal.
In a bull market, the main players use the FOGO mentality to harvest retail investors:
First, have a small rise (like 30%) → you think "it only rose this much, it must double" → continue holding → suddenly drop 50% → you panic and cut losses → then the main players pump it, and you can’t catch up.
What to do?
Set up a "partial profit-taking table":
Rising 30%, sell 20% of your position (recovering principal)
Rising 50%, then sell 20% (locking in profits)
Rising 100%, then sell 30% (locking in most profits)
Hold the remaining 30% long-term (betting on "what if it really goes 10 times")
The benefits of doing this:
Even if it crashes later, you at least preserved 70% of your profits + principal. Losing the remaining 30% won’t hurt.
Remember: in a bull market, the most expensive thing is not the gas fees, but your greed.
Tweet 4: Fatal mistake 3 - No risk control (all-in on a single coin)
In 2021, I had a friend who went all-in on LUNA with all his wealth (500,000).
The reason is: "20% annualized return, very stable, earn with your eyes closed."
In May 2022, LUNA went to zero, and 500,000 became 0.
He is still working on the construction site to pay off debts.
This is the consequence of "no risk control":
Putting all your eggs in one basket, if the basket breaks, all the eggs are gone.
What is the truth about the crypto world?
90% of projects will ultimately go to zero or close to zero. What you think is a "100x coin" may just be the next LUNA.
What to do?
Capital allocation principle (3-3-3-1):
30% buy BTC (anchor, stable rise in bull market)
30% buy ETH or SOL (mainstream public chains, relatively safe)
30% buy potential altcoins (dreams of 10-100 times, but may go to zero)
10% keep cash (emergency + buy the dip)
The benefits of doing this:
Even if all altcoins go to zero, you still have 60% of your assets in BTC and ETH, so you won’t lose everything.
And, never use "living expenses" to trade coins. The money used must be "money that doesn’t affect your life if lost."
Remember: the crypto world is not a casino, don’t trade your life for money.
Practical mindset 1-2 (partial profit-taking + psychological account)
After discussing the mistakes, let's talk about how to survive until the end.
Mindset 1: Partial profit-taking (counterintuitive but effective)
In a bull market, "selling" is harder than "buying."
Why? Because of human greed. After rising 30%, you think it can rise 50%; after rising 50%, you think it can double.
What’s the result? Holding on, bull market ends, all returns.
What to do?
Set your "profit-taking line" in advance, sell when it reaches, don’t hesitate.
For example:
SOL cost price $50, when it rises to $75 (+50%), sell 20% of your position and get back $750.
When it rises to $100 (+100%), then sell 30% of the position and get back $3000.
Hold the remaining 50% long-term, betting on "what if it rises to $200."
The benefits of doing this:
You’ve already locked in a profit of $3750, even if SOL drops back to $50 later, you won’t lose.
Mindset 2: Set psychological accounts (principal vs profit)
Split the account into two parts:
Principal account: conservative operation, only buy BTC/ETH, don’t chase highs
Profit account: aggressive operations, can invest in meme coins, play NFTs
For example:
Principal 100,000, earned 300,000 in the bull market, total assets 400,000.
So: 100,000 in BTC/ETH, hold steadily; 300,000 in profits can use half (150,000) to invest in altcoins, losing it won’t hurt.
The benefits of doing this:
You’ve always preserved your principal, profits can be risked boldly. Even if the profits are lost, you still don’t count as losing.
Remember: the principal is life, and profit is the bet. Don’t gamble your life.
Practical mindset 3-5 (stay away from social media + contrarian trading + keep cash)
Mindset 3: Stay away from social media during the peak of a bull market
Twitter, Telegram groups, Discord, during the bull market, all are about "10x coins, 100x coins" recommendations.
When you're bullish, you will FOMO, unable to resist going all-in.
What to do?
In the later stages of a bull market (for example, if BTC rises to $150k+), actively quit social media and check prices only once a week.
This way, you won’t be swayed by emotions and can calmly execute your profit-taking plan.
Mindset 4: Remember "build positions in bear markets, reduce positions in bull markets" (counterintuitive)
Most people do the opposite:
In a bear market, panic stops you from buying; in a bull market, you buy like crazy.
What about the results? Missed the bear market, and entered the bull market.
How do smart people act?
Bear market (fear index <30): Buy boldly, the lower it goes, the more you buy.
Bull market (fear index > 70): Start reducing positions and gradually withdraw.
Now (December 2025), the fear index is 29, categorized as "extremely fearful" → a buying window.
If the fear index spikes to 80+ in Q1 2026 → it’s time to consider running away.
Mindset 5: Always keep 20% cash (not all-in)
Many people invest all their funds in the bull market, leaving no cash.
What about the results?
Encountering a sudden crash (such as negative policy), with no money to buy the dip
Life emergencies force you to cut losses and exchange for money
What to do?
Always keep 20% cash, stored in the bank or stablecoins (USDT/USDC).
The function of this 20%:
Buy the dip during a crash (for example, if BTC suddenly drops by 20%, you can increase your position)
Emergency backup (living expenses, medical expenses)
Remember: cash is ammunition, don’t shoot it all at once.
Suggested timing (December 2025):
Fear index 29, the market is "extremely fearful" → this is a buying window.
But don’t go all-in at once:
Buy 1/3 position in December
Buy 1/3 in January
In February, decide on the last 1/3 based on the situation.
If FOMO really erupts in Q1 2026 (BTC hits $150k+), set your profit-taking points in advance:
$150k sell 20%
$170k sell 20%
Hold the remaining 60% long-term
Bull market profit-taking timetable (save for reference):
Save this table, follow it during a bull market, and at least keep 70% of your profits.#Solan #RWA #Web3 #美联储降息 #加密市场反弹
