Let’s be honest: Most people lose money in crypto. It’s not because crypto is a scam or because the market is rigged. It’s because they make predictable mistakes that destroy their portfolio.
I’ll show you the exact reasons why people lose money in crypto and, more importantly, how to avoid these costly mistakes. This approach is part of the same low-risk system I used to 20X my money in 16 months – and you can use it too.
The Hard Truth About Crypto Losses
I’ve been in crypto since 2017, and I’ve seen the same pattern repeat countless times. New investors come in during bull markets, make all the classic mistakes, and leave with empty pockets when the bear market hits.
Here’s what typically happens:
- People buy high, usually after seeing massive gains in the news
- They invest money they can’t afford to lose
- They panic sell when prices drop
- They never recover their losses
Let’s break down exactly why this happens and how to do better.
Mistake #1: FOMO Into Pumping Coins
“The time to buy is when there’s blood in the streets.” — Baron Rothschild
The biggest mistake I see is people buying whatever’s pumping that day. They see a coin up 50% and think they’re “missing out” on free money.
Here’s what actually happens:
- You buy at inflated prices
- Early investors dump their bags on you
- The price crashes
- You’re stuck holding worthless tokens
The Solution: Instead of chasing pumps, look for solid projects that are currently down but have strong fundamentals. If you’re not sure how to evaluate crypto projects, I’ve written a complete guide on how to fundamentally analyze altcoins that will help you spot the winners.
Mistake #2: No Risk Management
Most crypto investors don’t have any system for managing risk. They:
- Put all their money into one coin
- Invest more than they can afford to lose
- Don’t take profits when they’re up
- Have no exit strategy
This is like driving blindfolded and hoping for the best. If you want to protect your portfolio, I’ve created a comprehensive guide on basic risk management for crypto investors that will show you how to build a balanced portfolio with proper risk allocation.
Mistake #3: Trading Against The Cycle
Here’s something most people don’t understand: When you buy matters more than what you buy.
Even if you find “the next Solana,” you’ll lose money if you buy it during Bitcoin season or when the whole market is about to crash.
I’ve seen people:
- Buy altcoins when Bitcoin is pumping (and altcoins are dumping)
- Hold through obvious market tops
- Ignore clear warning signs of market cycles
The Solution: Learn to read the altcoin cycle. When Bitcoin dominance is rising, hold Bitcoin. When it’s falling, that’s your signal to consider altcoins. If you want to take advantage of these market swings, check out my guide on how to swing trade altcoins effectively.
Mistake #4: No Exit Strategy
The hardest part of crypto isn’t buying – it’s selling. I can’t tell you how many people I’ve seen:
- Watch 100% gains turn into 70% losses
- Hold through obvious bubble tops
- Never take profits because they’re “in it for the long term”
Without a clear exit strategy, you’re gambling, not investing. I’ve written a detailed guide on taking profits when trading altcoins that shows you exactly when and how to secure your gains.
If you want more on a complete exit strategy for crypto in general, you should check out step #3 in my complete cryptosystem.
The Truth About Making Money in Crypto
Making money in crypto isn’t about finding the next 100X gem or becoming a master trader. It’s about:
- Having a clear strategy
- Managing risk effectively
- Understanding market cycles
- Taking profits systematically
You don’t need to trade every day or spend hours analyzing charts. You need a system that works.
That’s exactly why I created The Premium Newsletter. Every week, I share:
- Exactly what I’m buying and selling
- When I’m taking profits
- Where we are in the market cycle
- New opportunities I’m watching
Final Thoughts
Most people lose money in crypto because they treat it like a casino instead of a market. They chase pumps, ignore risk management, and have no real strategy.
But it doesn’t have to be this way. With the right approach, you can turn the odds in your favor and build real wealth in the crypto market.
Remember: The goal isn’t to get rich quick. It’s to get rich for sure.
Want to start finding promising new opportunities? I’ve written a guide showing you how to find new altcoins with huge potential in just 5 minutes.
Your next move could change everything. Make it count.