The cryptocurrency investment landscape in 2024 has undergone significant changes. Each cycle of bull and bear markets in the cryptocurrency space presents a different investment environment, but the goal for investors remains the same: to maximize their profits.

Given that each bull and bear market cycle is unique, projects that were profitable in the previous cycle may have already lost their value in the current cycle. Therefore, this investment strategy aims to guide cryptocurrency traders to choose the most suitable investment approach based on their current circumstances.

It’s important to note that any tokens mentioned in this article do not constitute investment advice. Investing in cryptocurrencies carries risks, and investors should conduct their own research (DYOR, Do Your Own Research).

This content is sourced from BingX Investment Analysis, and if reproduced, please provide attribution and maintain the original content to avoid any misinterpretation. Investment is a very rigorous process.

1. Capital Held by Investors

Because investing in cryptocurrencies is high-risk, the bottom line for investment is to avoid losing the principal amount and then focus on making profits. If you entered the crypto market after November 2023, do not expect to make significant gains immediately. You need to determine how much capital you can invest in 2024.

If you have been in the crypto space for a while and have experienced two or more bull and bear market cycles, calculate how much capital you can allocate in 2024.

All capital should be calculated in USD, even if you hold your local currency, it should be converted into USD.

Based on the amount of capital held, it is divided into three categories: A5 (below $100,000), A6 (below $1 million), and A7 (below $10 million). We use round numbers here for ease of calculation, which translates to $100,000, $1 million, and $10 million, respectively.

The reason for this division is that the investment strategies for A5, A6, and A7 are different. The larger the capital, the more difficult it is to achieve significant returns because as the projects approach their peak, adding more capital does not necessarily increase profits. Many savvy investors enter and exit at or near the peak to secure their gains. You will find that there is a limit to the amount of capital a project can absorb, and the excess capital inflow can inflate token prices, leading to what is known as a bubble.

Predicting with 100% accuracy when a bubble will burst is nearly impossible. Even if your capital is not invested, it will still gradually depreciate due to inflation. Therefore, the primary goal of investment is to protect the principal.

2. Market Conditions in the 2024 Bull Market

Cryptocurrencies follow the Fibonacci pattern in the long term and have a total of five bull and bear market cycles. The 2023-2024 bull market is the fifth cycle. After each cycle, the cryptocurrency industry matures further. The more mature the industry, the more challenging it becomes to earn significant profits, and the capital required also increases. In the previous bull and bear market cycle, simply investing in popular new blockchains and the largest projects within those blockchains could result in 100x returns. However, in the 2024 bull market, successful new blockchains will be scarce.

This is why in the 2024 bull market, if you continue to use the same investment approach as the previous cycle, you will need a higher capital to achieve similar goals.

3. A5 Level Capital Investors

Investors with capital below $100,000 will have limited income potential in the secondary market in 2024. Taking BTC as an example, Bitcoin’s current price is around $43,000 and may reach highs of $45,000. Following this, under the dual pressures of an RRP of 0 and halving in March, it could drop to $35,000. More details please click bitcoin price prediction. Although it is expected that the 2024 bull market may reach a peak of $100,000, if you were to invest your entire $100,000 capital in Bitcoin now, your capital for the bull market would only grow from $100,000 to around $220,000.

If you have only $1,000 in capital, you would earn $1,200 in a year.

The question is whether this aligns with your initial expectations when you entered this field of investment. At the same time, if this capital comes from your regular job and is used for cryptocurrency investment, you will bear a very high level of pressure. This means that after a loss, you would need to work twice as hard to recover your previous losses.

So, for A5 investors who are new to the crypto space, the best approach before developing your own investment strategy is to participate in the initial stages of tokens. Acquire tokens at a lower cost than investors. There are two ways to participate in the initial stage of tokens: airdrops and minting tokens.

Minting tokens has temporarily cooled down with the Ethereum ecosystem. So participating in airdrops is the lowest-risk method. Participating in airdrops also allows beginners to gain insights into the cryptocurrency industry.

3.1 Airdrop Choices

Choosing airdrops in the Cosmos and Solana ecosystems is currently the best option. The reason for not choosing Ethereum airdrops is that the capital required for Ethereum ecosystem airdrops is very high. Additionally, some Ethereum projects do not have clear airdrop rules, resulting in airdrop token rewards being higher than the time and gas fees invested. In other words, these projects are not targeting community users but institutional investors who invest without airdrops, not A5 investors. This is also a problem that recent Ethereum projects have faced. They have become overly centralized and have used traditional financing methods to create decentralized projects.

Airdrops are essentially the process of earning cryptocurrencies with cryptocurrencies. For example, Cosmos’ airdrop requires staking Tia, and staking Tia itself generates income. You can then use the staking rewards to participate in airdrops, convert the received tokens back into Tia, and use them for staking. This way, your capital will increase rapidly due to this cyclical operation.

For more information on Cosmos and Solana ecosystem airdrops, you can refer to the “Cosmos Airdrop Guide” and “Solana Airdrop Guide.”

A5 investors aim to quickly understand the world of cryptocurrency to grow their capital beyond $100,000 through minimal risk. If your capital has already reached $100,000, the goal is to turn that $100,000 into $200,000 through airdrops. By using the earned $100,000 for asset trading in the cryptocurrency market, you can avoid significant psychological pressure.

4. A6 Level Investors

When your capital exceeds $100,000 and you want to profit through cryptocurrency investments, there are two critical questions to consider:

How many mistakes can this capital afford?
If you were to lose all of this capital, would you mind, and do you have another $100,000 to start again?

Losses in cryptocurrency investments primarily arise from not knowing how to invest in cryptocurrencies. Learning how to invest takes a considerable amount of time, at least one full bull and bear market cycle, which is approximately 2.5 years. If you have a regular job unrelated to cryptocurrencies, it might take five years or even longer, encompassing two bull and bear market cycles.

Therefore, you need to think about how long it will take you to develop your own investment system. For example, if you aim to invest in 100 different coins to form your own system, each coin’s investment amount would be $1,000. Every entry and exit should be well-reasoned, rather than buying 100 coins all at once. So, investing in 100 coins means engaging in 100 transactions and conducting 100 thought processes.

If you merely buy without thinking, it’s equivalent to making just one actual investment. People who make money with their first investment are rare, but people who achieve financial freedom with their first investment do not exist.

There are no shortcuts. If you’re an A5 investor progressing to A6, this time frame will shorten.

Many people in the A5 stage become A6 investors by luck because they happened to do one thing right, such as minting BRC-20’s Ordi. After Ordi’s price surged in 2024, they earned $1 million. However, without effective knowledge and skill support, they lost all the money they had earned in subsequent investments.

So, the progression from A5 to A6 and A7 represents a person’s growth path in the cryptocurrency industry.

5. A7 Level Investors

The wealthier you are, the more you understand the importance of preserving your principal. Even if your capital is not invested, it gradually decreases due to inflation, becoming smaller over time. Additionally, with a capital exceeding $10 million, earning a 4% annual return yields $400,000 in income. This translates to an average of $33,000 per month.

Think about what kind of job and how much time an average person would need to guarantee a monthly income of $33,000. Don’t forget that this income is entirely passive, meaning it’s earned without working. It’s passive income.

So, when your capital exceeds $10 million, the cryptocurrency investment allocation is not much different from when you had only $1 million. When you had $1 million in capital, purchasing a certain cryptocurrency might cost you $100,000. When you reach $10 million, it may still be $100,000. The reason is that many projects with the potential to skyrocket have small token market values in their liquidity pools. Investing $100,000 can lead to a significant price increase. With $1 million, the cost of purchasing low-market-cap tokens would still be high.

For large projects, investing $100,000 with a $10 million capital results in a 1% risk, while investing $100,000 with $1 million capital results in a 10% risk. In other words, the larger the project, the smaller the risk associated with larger capital. Preserving the principal without incurring losses is the primary principle of investment.

Therefore, when your capital exceeds $10 million, most of your funds are often placed in stable staking to generate income passively, with only a small portion used for trading.

6. A8 Level Investors

This is what will happen in the next bull market. Projects will require significantly more capital, and airdrops will be nearly non-existent. A8-level investors will be the ones able to participate and profit. The model will be similar to traditional listings. Small investors will no longer have the opportunity to see their capital grow by 100 times.

The challenge for A8-level investors is whether they have gone through the A6 and A7 levels and whether they have a precise asset evaluation system. Can they identify valuable projects? After the fifth bull market, the cryptocurrency industry has matured completely, and the ROI is similar to traditional enterprises, averaging around 5% annually. Assets are held for an extended period, and the actual ROI increases over time due to asset appreciation. This is the investment strategy for A8 investors.

This applies to mature markets. When the cryptocurrency market experiences its fifth bull market, using a mature market investment approach for cryptocurrency investments can lead to significant losses. This is because the last bubble in cryptocurrency is particularly severe. While it offers substantial gains, it can also result in losing everything. Three Arrows Capital serves as an example.

7. Conclusion:

Trading is about making money. Whether you make money or not is not about luck or looking at candlestick charts. It’s about understanding how money is truly earned, getting to the core of it. If you think you can make money from all projects just because you happened to make a fortune from one project, then you are the one who will be taken advantage of.

Not everyone aims for a 100x increase in personal assets because the larger your capital, the more limited the potential for gains and the smaller the percentage increase. A 100x increase in personal assets is more suitable for investors with a starting capital of $10,000.

People are easily swayed by one success or discouraged by one failure. Cryptocurrency has condensed centuries of human development into just 10 years. To achieve your income goals in this bull market, apart from hard work, rapid learning is the only way forward. There are no shortcuts.