Crypto - Buying Coins In Their Infancy as a Strategy

[Isaac]

I've noticed, as I'm sure others have as well, how meme-coins, alt-coins, sh*t-coins, (whatever you want to call them) often rise drastically in the early period.

For example, a coin might start out being worth .0001, rise to .01 within the first 72 hours, and stay there for 10 years.

It's the rise from .0001 to .01 that I want to buy-before.

Is there any reliable way to get notified when a coin first comes out or do you just go to the vendor of your choice (crypto.com, coinbase) and sign up for notifications as whatever they offer?

The only trick is, often in their infancy they're not listed on the 'easy' platforms (like Webull or Robinhood), and are only available to obtain by trading BTC or something else for it, or harder yet, sending a Paypal or something in exchange for a blockchain number to transfer to your wallet.
I'm thinking for me personally, the only viable - likely to succeed - option is to get it when it first comes out on a relatively easy-to-use platform, but before its first major rise ON that platform. In other words, I wish I could somehow 'buy into' a coin when it first begins to exist, without wrestling with the complicated matter of buying it before it's on any of the easy to use platforms.

What do you think about all this? I know crypto is considered child's play for some, and the meme coins certainly can seem childish, but if you buy and sell within the first few days/weeks............You could make a lot.

 

[Isaac]

From chat GPT, interesting and useful.

 

[Steve R.]

What do you think about all this?

It's pure speculation. Never use money that you can't afford to lose.
This "strategy" is not unique to crypto currency. It is also used by stock speculators when trading stocks.

 

[Cotswold]

@Isaac : Get in early

That applies to all pyramid schemes. Maybe create your own and then you're in at the start?
Then you're the one of the few that does well out of it and not one the many hoping the people running it do well and will drop a few crumbs down to the hopeful. How much will you recover if there is a panic and a run on the daffodil currency? When do you get out? What are the warning signs?

 

[Steve R.]

What are the warning signs?

When everybody recommends it.

 

[Jon]

Check what Nancy Pelosi invests in.

 

[Isaac]

well remember friends, I'm only talking about investing a tiny bit - $20, $40 maybe. Just enough so that if one of these silly coins starts out at .0001 and goes to .01 I've made some money.

And you're right Cotswold, the real winning idea is to start one myself but I'd have to promote it shamelessly and then bail on it at just the right moment..

 

[Jon]

I did something similar to this with a coin called LUNA. It crashed from like $100 to $0.0000001. I had a theory similiar to you, in that if it rebounded to $0.0001 I would make a lot of money. What happened? I made $20K profit in 2 days. I told my friend of the idea and he made $10K in 2 days, then cashed out. He paid me $400 of that as a gift for telling him the idea. I woke up the following day and I had lost $10K of that $20K as the market dropped.

The problem with this approach is that a) You don't know when to pull out, b) You don't know how any coins you have to invest in before one of these cases rockets up, c) Perfect Market Theory: if an an opportunity is there, it is nearly always seen and exploited before anyone has much of a chance to make any money.

The LUNA case was one of these one-off situations where the coin had a huge confidence issue, hence its crash and then partial recovery.

 

[moke123]

The LUNA case was one of these one-off situations where the coin had a huge confidence issue, hence its crash and then partial recovery.

Unlike FTX?

 

[Jon]

Unlike FTX?

These are altogether different cases. FTX was fraud and embezzlement, and they are not a coin.

 

[moke123]

These are altogether different cases. FTX was fraud and embezzlement, and they are not a coin.

They were an exchange but i believe they also had a coin.
one of the principals, Ryan Salame, is a local boy who bought half of the restaurants in downtown Lenox, a private airstrip, and a bunch of other local properties. I've been watching them get sold off by the feds since he went to prison.
People lost something like 8 billion dollars. No FDIC to bail them out.

 

[Jon]

Everybody who lost money with FTX is being refunded. I lost over $10K with them, and I am getting my money back. Should be coming within the next few months. In fact, I believe they are paying a little bit more than what I had in there, as like a compensation thing.

Most of the money I had with FTX was just dollars held in my dollar account with them. I had not invested the bulk of it in crypto at that stage. But Sam spent it all anyway!

 

[Isaac]

FTX is a whole different story, and makes you think twice bout keeping your coins in an exchange vs. a wallet.

I have to admit, I do , however, keep my coins on CEX's.

 

[Cotswold]

@Jon #8 "a) you don't know when to pull out"

Maybe don't let greed and 'what-if' have too much influence? If you turn a profit fine, then move on. I think that the trouble with things that expand quickly you really don't know why but once they fail you know exactly why they failed.

What if is the road to madness.

 

[Jon]

When you speculate to turn a profit, when do you move on? After you made $1? $10? $10,000?

 

[Minty]

I think with all these things you need to have a hard rule. Similar to being a good auction bidder.
You have a pre-set limit. You stick to it.

So you invest £100. Your cut off "get out" is set to £350.
If it never makes it you pull when your patience runs out and/or you've lost your gamble.
As soon as it gets to your pre-set value you pull it.

If you want to repeat the exercise, then you do another £100, and set another limit.
But you make sure you did pull it and then re-invest, other wise you run the risk of "letting it ride" and you have broken your rule.

 

[Jon]

So you pull out at £350. You are now confronted with the same decision as before you invested your money. Where do I invest my money? If you make a profit of £350 and then switch to another crypto coin, why switch? What is it about the other coin that makes it a better investment than the coin you are already in? Why wait until £350 if the other coin is a better investment? If the other coin is a better investment, why not invest in it earlier, before you get to £350? Timing when to invest, when to pull is very hard (impossible?) in unpredictable markets.

You say to yourself, "I will wait until I get to £350 profit." But you don't know if you will ever get there.

 

[Cotswold]

Maybe that is why some people are richer than others? They get the timing right.
But at the end of the day most of life is down to the people you meet and the decisions you make. For want of a description some call it luck?

Years ago a young guy in the town we lived in walked into a newsagents and bought one lucky dip on the lottery for £1 and won £5½million. A bit dopy, wife beater and divorced, so some said why him? Plus logically the lottery is a waste of money and most will say why just buy one ticket. At the other end Branson always makes out he did it all himself but his family were wealthy. Maybe about the same with Bill Gates? He could afford to drop out.
There ain't any rules unfortunately. Then some people use advisors. There are loads of financial advisers who will invest your money until it is all gone.

Just think. What if you had bought shares in Apple, Microsoft, Amazon, Google, Facebook and Intel with £1,000 each when they floated? Then each year reinvest the dividends. When would you sell up? The decision would have to be made at some time!

 

[Jon]

Yes indeed, some get the timing right. But is that down to being smart or luck? Maybe only hindsight gives the answer. You can make what appears to be a smart decision at the time, but because you cannot know all the relevant events that happen in the future, your smart decision could end up losing you a lot of money. Take FTX as an example. It was worth about $30 billion, promoted by all and sundry, including on the Mercedes F1 team as one of their main sponsors. But who knew that Sam Bankman-Fried was embezzling billions of dollars from this company, and its accounts were run on Quickbooks!!

 

[Isaac]

When you speculate to turn a profit, when do you move on? After you made $1? $10? $10,000?

Yes, that's the hard part. The higher it goes, my Greed would dictate "leave it there, you can make more".
Eventually, as long as I listened to that voice, I'd probably lose it all except the lousy $20 I started with