Disclaimer: This post contains thoughts on crypto, a volatile and risky asset class. It is not investment advice, and you should do your own research. All information is for educational purposes only. Please don’t take risks with money you’re not willing to lose.

With fresh liquidity entering the crypto ecosystem at a rapid pace, it’s more important than ever to capitalize on the opportunity at hand. As DegenSpartan once eloquently put, “You get a short period of time after graduating to hyper gamble into elite status, and if you fail you end up a wage cuck for life.” With that in mind, the impending mania gives enough reason to weigh options and reevaluate the path forward.

Of course, this is just a loose framework and different strokes work for different folks, or something to that accord. Certainly don’t expect to apply any of what I’m saying and instantly make money.

Setting Goals

Whether it be your fifth and hopefully last cycle, the first of many, or even just a temporary visit, it makes sense to ask yourself why you’re here. What is your purpose? And what do you wish to gain from that?

The reasons can vary—money, knowledge, influence—and there’s no shame in any of these pursuits. Although occasionally a mix of all three, the reality is that most participants are looking to (go figure!) financially profit as the broader market rallies. After all, I’d imagine that’s why the majority read this newsletter. Unless you plan to stay awhile and work + trade in the same industry like some of us deranged individuals, knowledge and influence become less significant. The classic bellcurve meme best displays this notion as crypto bull runs don’t discriminate against stupidity. In fact, it’s often rewarded.

So let’s just focus on the purpose of growing a portfolio.

Allocating Capital

With the goal of increasing your onchain net worth, it would be helpful to next ask yourself how much you feel comfortable with losing—this should be the amount you can afford to invest / trade. Then, in quantitative terms ($ or %), what do you ideally want to walk away with? It’s best to be realistic or else the goal becomes unachievable, and your account unprofitable. Moreover, these expectations are paramount to understanding how to best utilize funds. Let’s consider a scenario to better exemplify why size matters;

• If Bob puts $2000 in BTC at $95k, he owns ~0.021 BTC. If the price of BTC then increases to $150k, Bob’s fractions are valued at ~$3160. Despite achieving returns >60%, which TradFi would drool over in such short timeframes, the monetary notation feels underwhelming.

• If Alice invests $2,000,000 at the same prices, she custodies ~211 BTC. At $150k, Alice’s holdings equate to ~$3,160,000. The % returns are identical, but profit >$1m is a substantial gain in any regard.

Amongst whales masked by centralized exchanges, hedge funds, and now nation states, small fish simply have less market impact and therefore what feel like ‘diminished returns’. As such, if you’re a retail BTC investor with limited exposure, it would be naive to heighten targets without changing your timeline. For participants like Bob, this naturally makes growing a portfolio difficult without 1) resorting to the long game or 2) taking on more risk.

1. The first option means managing your expectations through multiple highs and lows (and likely enduring several cycles). If the monetary target necessitates BTC at $500k, you can’t capitulate because we don’t see it this time around. Conversely, with a greater amount of capital, that same target might be achievable at prices months from now.

2. The second option assumes the goal is to quickly run up a small account, consequently requiring more daily attention to the market and its developing narratives. This takes form by more frequent rotations, being early to new alts, and even adding leverage. With added risk, it’s best to return a portion of profits to the long-term growth of your portfolio (i.e. BTC).

Making Timelines

With your respective starting capital now in mind, how quickly do you want to reach your target? If your intended exposure is akin to a long-term retirement fund, there’s no point in overextending time towards chasing the “1000x”. Without beating around the bush, it’s likely that 99% of alts live slow deaths as true crypto wealth will be held in BTC. Stack sats and don’t even bother looking at prices. Check back in ten years and you’ll be able to tell people “I told you so” without going insane in the process.

Investing on long timeframes is conservative and often rewarding, but crypto has long been bridled as a ‘get-rich-quick’ economy. Evidently true via excruciating volatility (oh, and Fartcoin going to $1b), natives and tourists alike have expectations of life-changing returns with very little capital. If you fall into this bucket, it’s imperative to look beyond the majors.

Adding Risk

Consistent with other asset classes, risk is found as you move down the ladder of market capitalization. The discrepancies in crypto are especially large as even Bitcoin has teetered with the mass adoption pill until just recently.

The aforementioned ‘life-changing returns’ of course depend on your definition, but will likely only be found in the world of new launches—99% of which are memecoins. Albeit intimidating to the traditional investor, they simply provide the best low-cost opportunities to reach escape velocity in a cycle’s time (often shorter). WIF, for example, launched on November 20, 2023 and traded at fractions of a cent for a month. From mid-December to March 31, 2024, it ran from $0.01 to nearly $5—offering a quick 500x for anyone timely positioned. On a smaller scale, agentic AI memes have had their own time in the spotlight, with the likes of GOAT wicking to billions in under a month.

However, as I’ve emphasized in other writings, meta-chasing is not only time consuming, but ‘usually’ net negative EV. The participants performing best in these rotations are those with enough capital to spew at every microcap (until, well yeah, one eventually hits), or insiders. Of course there are a few traders that contradict this assumption, and genuinely find edges via experience, data, blockchain sleuthing, the list goes on. But for the vast majority, this world resembles a casino, and is just a fast track to zero without sufficient bankroll to remain afloat in case things go south.

A happy medium can therefore be found in top 200 or so tokens by market capitalization—many of which are easy accessible to the consumer CEX investor. In bull markets, a rising tide lifts all boats. If something feels undervalued, it probably is. Identify if the fundamentals are still there, do some research on the tokenomics (namely unlocks), and develop a thesis. A quick glance at the chart always helps too. With plenty of holders and sufficient liquidity, you at the very least won’t wipe your entire portfolio in one trade.

In Sum

Investing in crypto takes on many forms. The trenches inhabit basement dwellers that scan pump.fun 24/7, while more sophisticated traders take daily long/short positions on your favorite neighborhood DEX. You also have the Michael Saylors of the world, who simply accumulate on extremely long timeframes. A fine disciple is Rego, a trader who has been buying BTC at the same time every day, no matter the price, for almost eight years now.

Suffice to say, there’s no one way to play this game and everyone should adhere to their own rules—goals, capital, risk tolerance. If anything, just throw a stone and see where it lands. After all, few things in life are certain.