I survived the 2020 bull market, but since then I’ve seen too many legends disappear overnight. Some repeatedly got liquidated due to 30x leverage, ending up with zero in their accounts; some stubbornly held onto altcoins, going from a 50-dollar cost basis to a 20-dollar loss before cutting their losses, losing 6 million in one go; others missed out on Bitcoin breaking $100,000 and ended up smashing their computers in frustration.

You might think your losses are due to bad luck or poor market judgment, but the real killer is one thing: out-of-control positions.

**Leverage is a magnifying glass, but it amplifies more than just gains**

There’s a trader from Hubei named Mr. Bao. His market judgment is actually pretty good, but he fell victim to leverage. Using 30x contracts for a while, he eventually lost 2 million. He once said, “Trading contracts is gambling; everything is gambling.” — That’s harsh but true.

What’s the problem? Leverage amplifies gains, but it also infinitely magnifies human greed and fear. When the market rises, you want to add more and more, almost risking your entire net worth. When the market falls, you stubbornly hold on without stop-loss, fooling yourself into waiting for a rebound. Nine correct trades, then on the tenth, a sudden crash, and your account is wiped out.

**Altcoin faith is the biggest scam in the crypto world**

I’ve heard of a case where someone held 140,000 EOS, with a cost basis of $50. He firmly believed, “If Bitcoin goes up, altcoins will go even crazier.” But what happened? EOS dropped from $50 to $20, and he liquidated, losing 6 million.

The most common illusion in crypto is this: as long as the big coins rise, small coins will definitely explode. But the reality is, 99% of altcoins end up zeroed out.

I’ve summarized a lesson: besides Bitcoin and Ethereum, I treat all other coins as “high-risk experiments.” If I do trade, I never allocate more than 5% of my position to a single coin. That way, even if it goes to zero, you won’t lose everything.

**Emotional trading is the fuse for account explosions**

Data shows that new traders in contracts typically survive an average of only 37 days. Why? Because most are full of FOMO at the market peak, thinking they can make money from everyone else’s rise; at the bottom of a bear market, they hold small positions, and as prices fall, they panic more and more, ultimately chasing highs and selling lows, making mistake after mistake.

Ultimately, it’s never a single misjudgment that kills you, but out-of-control, self-destructive position management.