In crypto trading, it's vital to get the best information possible

Whether this is technical analysis, general opinion, price prediction, or whatever else - is not important. The better your information, the better equipped you will be to make good decisions about the future of your crypto investments.

Some people gather a lot of different crypto advice: blogs, videos, crypto groups, discussion boards, news sites etc. This is one way of doing it, but it's a quantitative method, how do you know which advice is the good advice? It's certainly not good enough to say: "the majority think that X will happen", because "majority" does not equal "correct". Many democracies are a shining example of this.

I prefer quality over quantity. Because of this I am very selective about where I gather my information from. And as for processing and analysing that information; for the most part I do that myself.

But not everyone has the time, ability, knowledge or inclination to do their own data analysis, and that is where the problem arises. People like that need someone to crunch the data for them and translate it into a usable and easy to digest format. They need experts.

From http://www.braintrainingtools.org/skills/every-expert-was-once-a-beginner/

Crypto Experts

My post of yesterday highlighted a major problem with the many crypto experts around. Most of them are not experts at all. They're "experts". Please read this if you have not already done so: https://steemit.com/cryptocurrency/@bitbrain/bitcoin-technical-analysis-major-indicators

There is an ugly reality to the world of crypto experts:

By Filipe Ramos from Porto (Spoon) [CC BY 2.0], via Wikimedia Commons; modified by Bit Brain

There are no crypto experts!

I am an amateur crypto investor. I have a accumulated a fair amount of experience in crypto trading. I have done a truly massive amount of crypto research, something which I continue to do. In crypto terms, I know what I am doing and I certainly know a lot more than most. But I'm still an amateur. I have a day job.

I am a professional Military Practitioner. Warfare is my passion and my profession. I've been in the military, working my way up the ranks for over two decades. I have more operations, exercises and long days of deployment time under my belt than what you've had warm meals.

People think that the stakes are high in the finance world. If you get things wrong you can lose millions of dollars and your reputation can be destroyed. If you get things wrong in the military you can lose millions of dollars of hardware, destroy your reputation, get a few hundreds or maybe even thousands of people killed, cause an international incident or embarrassment, compromise the security of your nation, get court-martialed or quite possibly die. Due to the nature of the environment that we work in, these things can happen in peace time as well as in war time. It's a very heavy responsibility and it causes an endless number of sleepless nights for those who must shoulder it. So you try very hard to get things right and then you hope like hell that your counterparts and those who you rely on to support you are doing the same (the vast majority of military personnel are in support functions, there are probably at least 10 support staff for every one operational one). I laugh at the finance world when they talk about their responsibilities, I wish those were the worst of my problems!

"Hooyah Bit Brain, you're so hard-core, what a man!" No, that's not what I'm getting at. There is a saying is often quoted in military circles, and I'm very sorry that I don't know where it comes from:

"It takes ten years to get ten years' experience."

It is absolutely true. I would never have wanted serious military responsibilities prior to having served for at least ten years. Prior to that I simply didn't have the necessary experience. I would have been stumped, I would not have known what to do. I would have been dangerous.

Even after ten years I would have regarded myself as having had the bare minimum of experience and practical skills necessary to lead men and women in a military scenario. I took many more years before I become comfortable in that role. I needed more training, more experience, more mistakes to learn from.

I am now very well trained and highly experienced in a wide variety of military scenarios and fields of expertise. These days I would regard myself as an expert. But I eat, sleep and breathe military. It's been my life for my entire working career and adulthood. It has taken a long time to become an expert. 5 years ago I was almost an expert. 10 years ago I was very competent in a variety of fields. 15 years ago I was an idiot who was a danger to himself and those around him. 20 years ago I was a young hooligan who should not have been allowed near weapons - but was! 😝

What's my point?

Bitcoin was the first cryptocurrency. 10 years ago the Bitcoin whitepaper didn't even exist yet. Cryptocurrencies have not even been around for 10 years yet! How on Earth can people be "crypto experts" already?

Every day I see the headlines: "Bitcoin will reach $5000 says expert", "Experts predict BTC price of $25 000 before 2019", "Experts say institutional money set to change crypto landscape" - what utter nonsense! Those experts are only "experts". Just because they are people who work in finance and / or have a crypto background does NOT make them experts!

Cryptocurrencies have not existed for long enough for there to be crypto experts!

"But Bit Brain, he's been a trader for 30 years, he works for Goldman Sachs!"
So what? Trading stocks / commodities / Forex is nothing like trading crypto. Sure there are many similarities, but the fundamentals of the markets are very different. I know that many traders dispute this, but they are wrong. The blockchain technology upon which the entire crypto market is based is ground-breaking. There is no precedent for it. The closest thing would be the tech stocks of 20 years ago, but they were still just stocks, they were not underpinned by an actual technology revolution.

Serious financial heavyweights such as Dimon and Buffett have displayed (and somewhat proudly portrayed) their monumentally poor understandings of cryptocurrencies. Their comments about the crypto market are so bad that they have reached the status of becoming jokes to those who know the crypto market. That's what happens when you try to apply existing financial expertise to the crypto field - it doesn't work, things are just too different. I have actually found that it is easier to teach someone who knows nothing about crypto from scratch, than to try to educate an experienced old-school trader. They find it almost impossible because they keep trying to apply their frame of reference to the crypto market. It doesn't fit, and they can't see that.

Similarly, your favourite YouTube crypto stars or bloggers are not experts. Just because they know more than you do does not make someone an expert. Journalists for crypto news publishers are not experts. Crypto hedge-fund traders are not experts (scary but true).

There are a few crypto experts - real ones

The people I would regard as bona fide crypto experts do exist, but they are very few and far between. There is always the odd high-genius who has put their all into something and has progressed in knowledge and experience at a rate far superior to the norm. Crypto does have its own Stephen Hawkings' and Beethovens. I would regard people such as Vitalik Buterin, Dan Larimer and Da Hongfei as real crypto experts. These are people with a solid understanding of blockchain fundamentals, an excellent grasp of the future of crypto and how it fits into the global economy, and experience in developing major cryptocurrencies. Anyone else is just a wannabe, at least for now.

I have put insane amounts of effort into learning about cryptos. I'm also a quick study. But no matter how hard I work or how much I learn, it will still take me ten or more years before I can start to even consider calling myself an "expert". Even with all of the theory under my belt, the market will still do things that I can not predict and that I haven't seen before. As long as the market can keep surprising me like that, I'm not an expert yet. The same applies to all of the other crypto "experts" around (most of whom have not put in nearly as much effort as what I have).

What does this mean to you?

It means that you must be careful. I have seen terrible, truly terrible advice given by some crypto "experts". It doesn't matter that it's televised on national television, it's still shockingly incorrect. I have seen very respectable science based publications printing pages of biased and ill-informed rubbish because they have consulted the wrong "experts". It means that you should be extremely wary of anyone who claims to be a crypto expert - they are almost certainly not - it's just not physically possible for them to be one yet.

You can trust good crypto amateurs or professional. The key is to realise their limitations and not to expect miracles from them. Crypto is still very new. We are all just putting our best guesses forward and hoping that we are right. The young age of the market makes things even worse as we continually break new ground with regard to things like regulations or security flaws and we experience extreme volatility.

My advice is to get a few trusted sources and to stick to them. Remember that they are also just human and that they are also just guessing. Don't expect too much from them, and always do your own research too.

Best of luck!

Your crypto expert, 😜
Bit Brain

Footnote: Day trading is different. You could apply a traditional mindset to crypto if you are only day trading. The fundamentals there don't matter nearly as much because you don't hold the crypto for long enough. It doesn't really matter so much what you trade: day trading is day trading.

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Published on

by Bit Brain

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