Newcomers entering the crypto market often make the same mistake: chasing whatever is hot and ending up as the chopped leeks. To break this cycle, the key is to establish a personal investment framework.

First, you need to be able to pick projects, because the profit ceiling is set here. Looking only at coins with attractive names won't cut it; you need to analyze from three angles. On the technical side, when reviewing whitepapers, focus on the consensus mechanism and core algorithms, and beware of forks that are just pure copy-paste clones. On the application front, there should be real business scenarios; in DeFi or NFT sectors, projects that solve actual problems are preferable. Concept coins that only tell stories should be avoided. From an ecosystem perspective, this is where you can see the real value; monitor on-chain data—distribution of token addresses, daily active users, DEX trading volume—to determine whether the hype is genuine or just fake heat created artificially.

The second hurdle is capital allocation. Don't use your living expenses to trade cryptocurrencies; it's safer to use idle funds, and it's recommended that this not exceed 10%-20% of your disposable income. Diversification is crucial—split your positions according to risk levels. Core assets like BTC and ETH can be allocated more heavily, while growth and speculative coins should be kept in smaller positions for testing. This way, if one project crashes, it won't take down your entire portfolio.

Risk control is a hard metric. Set stop-loss levels dynamically: for core assets, cut losses at 20%-30%; for growth coins, 30%-40%; for speculative coins, 40%-50%. If the price falls below these levels, sell immediately. For taking profits, lock in gains in several batches—don't be greedy. When core assets reach 50%-100% gains, gradually reduce your holdings. Regularly review your trading records and adjust your strategy accordingly.

The last aspect, and the most easily overlooked—mindset. Don't be driven by FOMO to chase rallies, and don't panic sell at the first sign of decline. Always do your homework before buying or selling. Investing is a long-term endeavor; avoid the dream of getting rich overnight. Overcome greed and fear, and stick to your predefined take-profit and stop-loss levels. Building a systematic approach takes time and continuous learning and practice, which is essential to standing firm in the market.