I heard about Bitcoin and received a lesson in 2011-2012 from a friend who was an early investor in it. However, I didn't understand anything about what he was saying, as he was also not very knowledgeable about it, and couldn't answer any questions in detail..
This was also the time when I was starting my poker career and playing Sit and Go's on PokerStars, and I was achieving decent results. Later on, one new national poker site launched, and I was running so well and was dominating the SNG/MTT games, making 20k€/year while the average salary was around 5-6k€. I didn't know what to do with the money, as I was very young and lived a fairly simple life, so I was just stacking it in some online accounts.
Few Years Later..
I started my investing career in 2016 when my friend and I bought 500€ of crypto (XRP) each, and the price went from 0.22$ to 3.4$ in a short period, and we thought we were geniuses.. I was more risk-averse, and I sold on the way up and made around $5,000, while my friend was greedy (didn't want me to cash his money out) and he only made $1,000 in the end as the price crashed.. (We were super lucky.)
I used that money to start building my portfolio and I stared researching more about crypto i had my cash diversfied in few different cryptos and i was making incredible profits on it..
At one point I sold everyhing and left a small piece of it $400-$500 in BCH, and it was 2018 when big crypto crash happened and i lost 95% of that BCH investment and then I realized..
I got lucky the second time with timing the market, and this can't continue like that indefinitely, so I need to change something, and I started researching and talking to people online about stocks..
Like a Cat With Nine Lives..
I fell in love with value investing as I was following and reading a lot about Warren Buffett, Charlie Munger, and Pete Lynch.. Right away, I started to have great results beating the S&P 500 as I was lucky to jump into one of the biggest bull markets ever..
I was still a rookie in the game, but I had such a big edge over the investors who started after me, as I dodged the bullet on the big crypto crash, but got experience of how significant the risks were, and how vital valuation and fundamental analysis of the company are
My first two years in stocks were good and i managed to make +69% in 2019+2020 which were years when covid happened and stock market went into the big crash, once again I was lucky with timing but I was aware of market crashes which also helpled me as I had mentality just to buy when something is cheap and not chase, as most crypto speculators do.
Why do I call them speculators? Well, in theory, crypto is a speculative bet and is not considered an investment.
In upcoming years, I beat the SNP500 but lost the race to crypto people, which is expected, but I want to stay in the game for a long time and have at least some control over the outcome. By putting your money in crypto, you don't have any of these.
NFT Mistake, Best Year of My Investing Career
In 2020-2021 there was a NFT boom, and one of my poker buddies put most of his money from poker into NFTs and guess what.. crash happened and he lost 99%.. To make things even worse, he asked me about stocks and I tried to give him some advice, but he just didnt know about the risks and made a mistake.
2022 was the best year for my stock investing career.. (Although results came in 2023, the investment was made in 2022) as we saw facebook (META) stock fall from around $374 to around $90 and I knew as we all do about Facebook and it was one of the stocks I was watching for some time and was waiting for price to fall so i can invest in it.. I pulled the trigger and put around 30% of all money I had in META and i put 15% more in GOOG stock which aslo fell close to 50% ($88)..
I knew both of these were amazing companies, and the reasons why they fell were just temporary. The rest is history.. META is above $700 today, and Google is around $250.. I made like 3x on META, and I made something similar on GOOG, as I traded it over the years, with the last sell trade being around $230.
So, with all the luck in crypto I had, and now as I'm approaching my 10 years investing in the markets, I'm super confident you shouldn't be touching crypto as a poker player.. You already have a huge variance in your income, where you can have a great year, but then you can just be breakeven for the next two years.
This is why you can't afford all of that hard-earned money to disappear in one year like it did for a lot of people in crypto in 2018.
Marathon, Not a Sprint..
Today I completely transitioned from MTTs and SNGs, and I'm a full-time cash game player making a steady income while continuously beating the SNP500 by investing in stocks and just accumulating wealth without having to worry my money could get evaporated.
Whatever people are saying, this is the truth: Crypto is a Ponzi scheme, meaning it has no real value, and it's only worth as much as somebody is going to pay for it. For example, let's say BTC goes to one million and all the Bitcoin is already mined. Who are you going to sell that BTC for one million?
The price is based just on what somebody else is willing to pay for, so it's the game of "bigger fool", and at some point, when everybody wants to cash in on their BTC and there are not enough buyers, what do you think will happen? Ask yourself, what is the purpose of BTC if there is nobody to sell it? What can you do with it except buy it and wait for it to be worth more and then sell it?
Lesson
When estimating if something is a good investment, people just see it partially and only see the upside. Still, every investment is a two-part decision, as it also has the risk side, and our goal is to hit the best risk/reward opportunities and not just look at the reward, as we might never reach it, like calling all-in on the turn with a flush draw to catch a flush with around 18% equity. Yes, when we hit, it's great, but most of the time we miss and we are out of the game.
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