“Last week, the Federal Reserve's interest rate cut was finalized, and three of my crypto friends faced a total liquidation of 2 million in a single day!” I believe this reflects the reality of many people recently. In December, the Federal Reserve's third interest rate cut was settled, and the market directly staged a classic play of 'buy the expectation, sell the fact.' Bitcoin fluctuated repeatedly in the range of $88,000 to $93,000, and the total liquidation amount across the network in the past 24 hours exceeded $400 million. On one side is the frenzy of gold soaring over 61% this year, while on the other side are the tears of high-leverage players in the crypto market. Can ordinary investors only passively get slaughtered in such a market of ice and fire? As an analyst who has been in the crypto space for 8 years, I want to say: it is precisely during this volatile period that small funds have a golden opportunity to turn the tables. Today, I will share my core strategy for avoiding liquidation and achieving a 15% return in 30 days without reservation.
First, it is essential to clarify a core understanding: In an institution-led market, the fatal mistake of retail investors is 'chasing highs and cutting losses + high leverage'. The most noticeable change in 2025 is that the marginal buyers in the crypto market have shifted from retail investors to asset allocators. The inflow of funds into Bitcoin spot ETFs like BlackRock's IBIT exceeded $3.5 billion in a single week in the fourth quarter. This means that market volatility will be compressed, but once the stop-loss line is triggered, it will lead to widespread liquidation. All the friends around me who faced liquidation used leverage of over 5 times, trying to make quick money during the interest rate cut trend but ended up being washed out directly by the institutional funds' 'boiling frog' style of oscillation.
My core logic for reversing is simple: abandon high leverage and focus on a combination strategy of 'undervalued old coins + interest-generating stablecoins'. Let’s talk about the interest-generating stablecoins first; this is my 'ballast' to avoid risks. In 2025, the on-chain stablecoin trading volume reached $46 trillion, a year-on-year increase of 106%, but many people do not know how to choose safe interest-generating products. The lessons from projects like Stream Finance's XUSD and Elixir's deUSD collapsing tell us that products promising 20-60% annualized returns with opaque collateral should absolutely be avoided. I chose interest-generating products related to the x402 protocol supported by Coinbase, as well as compliant interest-generating USDC in collaboration with Circle; although the annualized return is only 4-6%, it is safe and stable. By placing half of the funds here, I can ensure the safety of the principal and obtain stable returns.
The real breakthrough in returns comes from the undervalued old coins I positioned. In the fourth quarter, veteran projects like Zcash, ICP, and Filecoin collectively reversed; ZEC soared 151% in the past 30 days, and ICP rose 111%. The reason I could position early is that I captured two signals: one is technical upgrades, and the other is narrative reconstruction. Taking ZEC as an example, at the end of October, I noticed that the Zcash development team ECC announced a performance upgrade plan for the privacy wallet Zashi, while Grayscale Trust restarted the ZEC subscription, coupled with the scarcity increase due to the 2024 block reward halving, these are all clear signals of an upward trend. ICP, on the other hand, is tied to the AI narrative, with the DFINITY Foundation launching the DeAI platform Caffeine, bringing 'AI + chain' from concept to reality; this is a typical example of 'new wine in old bottles' value reassessment.
Here’s a practical tip for everyone: When filtering for undervalued old coins, focus on three indicators. First, the circulating market cap is at a historical low, having dropped more than 70% from its historical high; second, there have been clear technical upgrades or ecological collaborations recently, such as FIL's v26 network upgrade reducing Gas fees, and NEAR collaborating with Nasdaq-listed companies to build a crypto treasury; third, on-chain data shows that whale addresses are continuously accumulating, rather than retail investors clustering together. The ZEC and ICP I invested in at that time fully met these three conditions; after buying, I set a profit-taking line of 15%, and by the end of November, it just reached the target for an exit, perfectly avoiding the subsequent minor pullback.
Some friends may ask: Now that there are huge discrepancies in the Federal Reserve's interest rate cuts and the dot plot has reached a new 11-year high, with an unclear future policy path, should we liquidate and wait? My view is: there’s no need to panic, but the position structure should be adjusted. Current on-chain data shows that large investors are already resuming accumulation, while small retail investors are still holding without panic selling. This indicates that institutions are taking the opportunity to accumulate, and ordinary investors should instead use my 'ballast + undervalued' strategy to position during this volatile period. It is important to note that you should not blindly follow the trend to buy all old coins; projects that lack technical upgrades and rely solely on capital speculation rise quickly but also fall quickly, so they must be avoided.
Finally, let me summarize the operational steps for everyone: Step 1, divide the funds into two halves, allocate one half to compliant interest-generating stablecoins to ensure basic income; Step 2, filter the top 100 old coins by circulating market cap from CoinGecko that have dropped more than 70% from their historical highs, eliminating projects without a technical team or ecosystem; Step 3, check the recent announcements and on-chain data of these old coins, focusing on signals such as technical upgrades, institutional collaborations, and whale accumulation; Step 4, select 2-3 qualifying projects, investing no more than 20% of the total funds in each project, and set a profit-taking line of 10-15% and a stop-loss line of 5%. Following this strategy, I successfully avoided the overall liquidation wave in November and achieved a 15% return, which is the core logic of small funds reversing during volatile periods.
If you are still anxious about the Federal Reserve's policy swings and suffering from high leverage liquidations, you might as well try my 'ballast + undervalued' strategy. I will continue to track whale address movements and the technological upgrades of old coins at Binance Square, updating a list of suitable targets every day. Follow me, and tomorrow I will share (3 RWA track reversal cases that institutional funds are buying, which retail investors can also get on board), revealing the profit logic behind the $23 billion RWA market! Follow me, and you won't get lost!
