From Pitfalls to Awakening: 15 Survival Rules Earned Through Bitter Experience by a Crypto Veteran

Author: Based Money Lich King

Translation: TechFlow

In the previous market cycle, whether during the bear or bull phase, I made many mistakes due to lack of experience. However, these errors have become invaluable lessons for me. I paid a steep "tuition fee" to the market, but in doing so avoided numerous traps that could have cost me nearly all my gains. I’ve distilled these lessons into a set of rules that I now strictly follow. Today, I want to share them with you. These rules aren’t meant to make you rich—that’s up to you. Their true purpose is to help you survive in this high-risk environment. Remember, even during a bull market, risks remain, and poor decisions can still lead to getting "liquidated."

Of course, these rules aren't absolute, but they can help reduce your risk in this highly uncertain market.

Rule 1: Never be an early participant in a heavily anticipated blockchain event

When a blockchain event attracts widespread attention, early participants are often punished. Early investors in Sushiswap suffered losses, as did those who bought Otherside deeds—there are many such examples. Those who jumped into Sushi too early ended up paying a heavy price. The right strategy is to wait patiently until market sentiment stabilizes and fear, uncertainty, and doubt (FUD) or excessive hype dies down, then reassess whether the risk-reward ratio justifies entry. If the entire crypto community (Crypto Twitter, CT) is buzzing about something, being an early adopter usually leads to failure.

Rule 2: Never recklessly use perpetual contracts (Perps)

Perpetual contracts are tools designed for "giga whales," not retail investors. Most people aren't GCR, Hsaka, Andrew Kang, or Nexus. You shouldn't be trading perps. These instruments are typically used by whales to adjust positions or place small bets with low leverage. Leverage of 10x or higher is like handing your soul over to the devil—don't even try it. Perpetual contracts are the fastest way to lose all your capital, period.

Rule 3: Always assume others have malicious intent

You're operating in the "Wild West" of finance. There are no real friends here—even if someone appears friendly, treat them with caution. Countless stories exist of people being betrayed, attacked, or scammed by those they trusted. Assume everyone around you might be a bad actor or potential scammer. Don’t trust anyone blindly; assume every person would sell your assets at the first opportunity.

Rule 4: Never idolize founders

Founders are among the most dangerous figures in this space. They frequently cause losses for investors and token holders. Do Kwon, Dani Sesta, Andre Cronje—all have repeatedly disappointed their communities. Chef Nomi, the Starknet team, Celsius' founder—the list goes on. Don’t treat founders as heroes. Assume they will deceive you, because chances are, they eventually will.

Rule 5: If a team’s behavior seems suspicious, create FUD and concern troll

This rule complements Rule 4. If you notice questionable actions from a founder or team, actively generate fear, uncertainty, and doubt (FUD), and "concern troll"—express exaggerated concern publicly. Challenge the project's decisions and encourage others to do the same until the team abandons its dubious behavior. Those who blindly support teams may end up losing everything. Protect your own interests.

Rule 6: Never lock up your tokens

Locking tokens for months was one of my biggest past mistakes. Never do this! Locked tokens expose you to smart contract hacks. Moreover, when teams know investors’ tokens are locked, they’re more likely to act unethically. The TempleDAO Opening Ceremony incident is a classic example. Avoid locking your tokens to prevent being trapped in a powerless position.

Rule 7: Stay away from Sisyphus

Sisyphus executed a rug pull worth $60 million and remains at large. Whenever possible, avoid him and any projects where he appears as an “angel investor.” In this ecosystem, Sisyphus is one of the most notorious dumpers—a predator and destroyer on-chain. Stay vigilant and take responsibility for protecting your assets.

Rule 8: Don’t buy parabolic pumps

Avoid chasing assets experiencing parabolic price surges. While you might occasionally succeed, failure is far more likely. Instead of gambling, exercise patience and wait for market corrections.

Rule 9: Focus on market cap, not price

Many get fixated on unit price, especially XRP supporters claiming it can reach $10,000 or Shiba Inu hitting $0.01. These targets are utterly unrealistic. Judge investments based on achievable market caps, not fantasy prices. That said, if others want to believe in impossible price dreams, let them.

Rule 10: Remember to take profits

If you're facing financial hardship, selling part of your holdings to cover expenses is completely rational. This market will always exist, and opportunities will keep coming. Many chase arbitrary number goals—like 50K, 100K, or 200K—and end up giving back all their gains. If reaching such a number would meaningfully improve your life, cash out. As Foo once said, aim to earn the equivalent of two years’ salary from the market. That level of financial security makes you a better trader and improves your quality of life. In the long run, this mindset shift pays off significantly.

Rule 11: Never connect to unfamiliar applications casually

Be extremely cautious before connecting to any new app—doing so could result in stolen funds. It’s wise to first test with a wallet containing minimal funds to verify safety before using your main wallet.

Rule 12: Don’t believe in the “supercycle” narrative

The idea of a “supercycle” suggests markets will rise endlessly. Is this truly a supercycle? I don’t know. But if it isn’t, I don’t want to repeat past mistakes by believing the hype.

Rule 13: Don’t give up during bear markets

When we inevitably enter another bear market, I hope you’ve already followed Rule 10 and taken profits wisely. Bear markets aren’t something to fear—don’t quit. In fact, some of the biggest gains come right after bear markets end. I’m living proof. Use bear markets to sharpen your skills, refine your trading strategies, and prepare for the next bull run.

Rule 14: Avoid tokens tied to “occult” themes

Investing in such tokens may bring unpredictable consequences. Even if you’re a materialist and dismiss the mysticism, recognize that the creators behind these projects often have questionable ethics and ulterior motives. Choose your investment targets carefully.

Rule 15: Wholeheartedly commit to your beliefs

This is the most important rule—and the only way to stay grounded and humble. We may never fully achieve it, but striving toward it is growth in itself.