OK, I tried it. I wasn't going to. I had stayed strong, researching "solid" and long term, hodl*-worthy coins. I entered the cryptocurrency world in early July and bought my first coins after doing my research, checking out the community, and deciding whether I dug the tech behind the coin. Then I watched as the market tanked, most likely due to the scare of the soft or hard or medium rare Bitcoin fork that is due on August 1. I've remained calm and have held my positions and will look to add to them when the time is right, which is anywhere between this exact second and post-fork on August 1.
A few days ago, I added more funds to my Coinbase wallet and will wait the 32 years** it takes to arrive. I plan to use those funds to add to my current holdings and buy a couple more coins I've been researching. So far, no need to play the pump and dump game.
Then came the master node flurry and I got my first taste of the over-hyped phenomenon. I am a member of a Facebook (FB) group of crypto coin enthusiasts*** who have come together primarily as a result of the members recently taking an online cryptocurrency investment course. Most of the posts have been what you might expect from a new group of cryptocurrency investors ("Isn't the word hold? Why is everyone saying hodl?") and some in the community have even made solid coin investment recommendations, but the forum quickly morphed into a dark place and the master node coin hype began to infiltrate my feed at a furious pace. I missed on the first coin, Chaincoin (CHC), because I was busy researching what the hell a master node was. Having obtained that knowledge, albeit limited, I set out to find the best master node coins; however, two things happened:
- I didn't trust or believe in any of the subsequent coins being hyped and
- The coins were often hyped so fast, by the time I looked at them, the 1,000,000%**** gains had already been reached.
I have a day job so I wasn't able to track the conversations, coins, and master node rules in a timely manner so I decided to keep my eye on CHC and see where it went. What I found out is that the over-hyped game seems to work, for a while, and with certain coins. By last night the hyped coins, as well has the hype, had dropped. However, I do believe folks made money, maybe even serious money. In the end, a majority of the over-hyped master node coins had returned from the moon. Cash was made depending on if/when people bailed. I went to bed Friday night glad I didn't jump in because I would have jumped in too late and taken losses. Whew. Then came Saturday...
I woke up Saturday morning, grabbed a cup of coffee, sparked up the computer, checked out some coins, and saw that nothing major had gone on over night. The master node coins were still down, maybe not as far as they had started 24 or 48 hours earlier, but down from the big gains that they had recently obtained. My "solid" coins, both in my portfolio and those I'm watching, are still down to near lowest ever levels. I was content to go about my day...then I saw it...in my twitter feed. A tweet from someone whose bio states that he provides news and updates from the cryptocurrency world. Something like that. I'm paraphrasing. He was hyping a coin. I don't want to mention the coin so as not to trash it or be accused of over-hyping it myself, but it had gone up 50 to 75% in price and the volume had increased significantly since earlier in the day. It was apparently primed for a run. "To the Moon" someone posted on FB. I decided to check it out. There was nothing exciting to me about the coin. It had been around for years. I understood the tech behind it but wasn't sure how successful it could be, especially since it really hadn't made a move in years. Still, coins yesterday were being pumped without any recent news or exciting tech. I see the game. Short term hype, a rise in price, and a massive sell off. I walk away with millions in a manner of hours and buy my own island by late afternoon. I don't typically use Cryptopia as my exchange, but I had transferred some Bitcoin there ready to pounce on CHC, which I never did, so I thought "what the heck. Let's make millions" and I clicked the buy button.
There was a rush of exhilaration as the coin immediately jumped up a bit. Whoo Hoo! Time to start shopping for islands.
Then, it held firm. One minute, two minutes, five minutes. Then, a slight tick up. Yes! It was going in the right direction but not at the speed of yesterday's coins. Maybe I have to wait until tomorrow to buy the island, but that's fine. I have no plans. However, was I now going to sit in front of the computer all day? Watching my coins move slowly to extreme wealth? As good as that sounds, I didn't want to waste the day in front of the computer (although now I'm writing this post). So I decided to set a sell order so that I could walk away without worry. I would sell at a slight tick up from where I bought it. At worst case, I would break even and maybe cover transaction fees. I ran to the kitchen to get an apple to celebrate my marvelous plan and when I returned, I realized that I should have placed that sell order before leaving my desk. The coin, as if watching my every move, mocking me, waited until I left my office before plunging to just below where I bought it. I quickly entered a sell order but I missed the mark. It was dumping. I lowered my sell price and placed another order. This time I caught it but by that time the price had dropped lower than what my marvelous sell plan had...planned.
"How much?" My wife asked.
"About what I would have spent on a really nice lunch this afternoon so as punishment, I'll make myself a sandwich," I answered, thankful I hadn't mentioned the island.
Overall, I didn't lose that much money, but the rush I felt entering a trade that I knew was short term and volatile was nothing like I'd done before. Sure, I've bet on horse races and have been to Vegas, but those events generally have known outcomes. You understand what you'll lose and you have an idea of what you can win, whether it be a horse race or at the blackjack table*****. During my 10 minute adventure this morning, I dreamed of thousand percent gains, could really see it happening. It happened just yesterday. Why not today...to me? Then...the crash and subsequent frantic actions to sell before the coin dropped to less than zero and large men in dark suits knocked on my door demanding their cash or my broken limbs. Hours later, the coin sits exactly between where I bought and sold it. It didn't crash to the basement floor nor has it taken the ride to the moon as folks hyped this morning. The hypers have moved on to another coin. There's always another coin. I'll have to wait for my island.
Footnotes
*I am on the side of those who believe hodl as being coined (get it) from a typo of the word “hold” and not as the acronym Hold On for Dear Life.
**Yes, I am exaggerating and, yes, I know I can speed things up by using a credit or debit card but I don't want to pay the extra fees and I definitely don't feel the need to rush into the market right now so I am perfectly happy to wait while I stare at coinmarketcap.com all day -- come on, you know you do it, too.
***This includes speculators, trolls, scammers, spammers, newbies, long term traders, those against the Man, the Man, and actual cryptocurrency enthusiasts who don’t fall into any of those other groups.
****Again, I am exaggerating.
*****I realize that I am oversimplifying the gambling game and even though you know the odds and how much you're betting on a horse or how much each hand costs at the blackjack table, stopping yourself from obtaining huge losses is not that always that easy. My point is when I was watching my coin go up in price, I knew what I had invested (bet) but the ceiling to my potential reward was limitless at that moment. That was the ultra-exhilarating part.