Original Title: "8 Tips to Master the Next Bull Market: Enter the bull market fray responsibly"

Original Author: William M. Peaster, Bankless

Original Translation: Kaori, BlockBeats

"Has the bull market returned?" This is the question that everyone is asking after the exciting activity in the cryptocurrency market sparked by the Bitcoin ETF last week.

Currently, only time will tell, but there is no doubt that more and more people are beginning to accept the idea that we may be on the brink of the next cryptocurrency bull market.

So, if you are a beginner or know someone who is, and want reliable advice on how to prepare for investing in the next cycle, I have compiled a roadmap that includes 8 basic recommendations extracted from my personal experience and the collective wisdom of the crypto community to help guide you on your journey.

1. Develop Investment Thesis

Cryptocurrency investment is the kind of thing in life that requires having a thesis. It doesn't have to be long, original, or set in stone. But without a thesis, you run the risk of wasting money and time in the market without any guidance.

For example, I remember the scene when I first participated in the bull market in 2017. I felt like a child in a candy store. At that time, it seemed that every new coin I saw was more dazzling and interesting than the previous one, so I bought a lot of junk because I didn't have a serious argument except for "haha, cryptocurrency is cool".

That didn't take me very far. But fast forward to 2021, after more thinking, I established a guiding vision during the subsequent bull market to double down on investing in Ethereum, as it is becoming the next great open finance and cultural layer globally in my view. Therefore, through in-depth research of a genuine argument, my second attempt has achieved considerable success!

2、Suitability is the most important

When browsing cryptocurrency social media platforms, you will see various flat avatars, which can easily make you forget that the people behind these accounts come from different age groups and have different life experiences. Everyone has a different story, and everyone has different financial resources.

All of this is to say that in the next bull market, you may see people around you investing a large amount of Ethereum into the "next big coin" or "next big NFT", which may trigger your FOMO. You may be tempted to try to keep up with the trend and invest more Ethereum than you can afford.

Don't do this! Respect the different stages of your investment journey and realize that accumulating your crypto assets is a marathon, not a sprint. By proceeding in an orderly manner instead of acting recklessly, you will achieve your goals. Invest according to your financial capacity and only invest in a scale that is suitable for you.

3、DCA is your friend

In the encryption industry, prices can fluctuate dramatically within minutes, and it is not uncommon to see double-digit percentage changes in a single day. For beginners, this can be both exciting and nerve-wracking. Instead of trying to time the market during these fluctuations, Dollar Cost Averaging (DCA) is a common and reliable strategy that involves investing in batches at an average cost.

DCA method involves committing to purchasing specific assets, such as ETH, BTC, SOL, etc., at fixed dollar amounts at regular intervals, regardless of their prices. Instead of trying to time the market perfectly, you will be buying over a period of time. This can be weekly, bi-weekly, monthly, or any other interval that suits your investment plan.

By making purchases in a dispersed manner, you reduce the risk of buying at a high point. Even if you start investing at a high point, subsequent purchases during a low period will average out your entry price. DCA also eliminates emotional factors in investing. You don't have to constantly try to predict the next move of the market, which can lead to hasty decisions based on fear or greed. Instead, set a plan, stick to it, observe your investments over time, and avoid constant monitoring or overthinking.

4、Do not avoid profits

When I first entered the cryptocurrency industry in 2017, I invested my only $300 into Ethereum (ETH) and grew it to $25,000 through "only rise, no fall" small coin trading. In December of that year, Bitcoin had just reached $20,000 for the first time, and there seemed to be no sign of slowing down, with the entire cryptocurrency market looking promising.

However, a month later, the bear market began. I held onto my small coins during the first half of that bear market, thinking that the situation might improve. But those coins never recovered, so I ended up converting that $25,000 back to zero, except for my Ethereum. There's no doubt that was life-changing money, and I should have made better use of it.

In the bull market of 2021, I did not make the same mistake because I locked in some profits along the way. However, I know that more than a few people believed that Ethereum, which was priced at $5,000 at the time, was just a stopover on the way to $10,000 and did not sell when they had the chance to lock in some substantial profits before the next bear market. In the next cycle, make sure you have an exit strategy and turn some of your virtual gains into real currency; you will thank yourself later.

5、NFT as a leverage bet on Ethereum

By investing in selected NFTs on Ethereum, you may be able to take advantage of the bullish momentum in the NFT market, with the hope of achieving higher Ethereum returns when selling NFTs in the future. This is a classic buy low, sell high strategy.

It's easy to say, right? And many NFTs should not be viewed solely as financial instruments that can be flipped. However, in many cases, flipping is possible when the entire market is on the rise.

The concept here is potential amplified returns. This is because the price fluctuations of NFTs can be significant, with significant potential for price appreciation. Therefore, the returns obtained by investing in NFTs (if you choose the right NFT at the right time) may be amplified relative to holding Ethereum. This strategy is worth considering for beginners, but I again caution against treating every NFT as a flip-able object. Some are, but not all!

6、Familiarize yourself with your tools

Sometimes, when visibility is limited, pilots have to "fly by instruments," meaning they can only rely on their familiarity with the aircraft resources to navigate. Therefore, when I say "familiarize yourself with your tools" here, I am metaphorically suggesting that you practice and personally use all available encryption applications to gain proficiency in the Web3 toolbox.

This process will not only drive your progress on the personal "encryption skill tree" and provide you with experience and mastery, but it will also begin to feed back into your application in other strategies, such as what your overall investment thesis is, how you conduct dollar-cost averaging, which NFTs you buy, and so on.

In other words, understand the projects here. Understand what they offer, how to use them effectively, the challenges they face, and so on. In this way, you will gain wisdom that will further enhance your investment approach.

7、Don't ignore taxation

In the bull market, people made a lot of money, which should be subject to taxable income. When the next bear market begins, their asset values will drop significantly, but their tax burden generated in the previous bull market years remains high.

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