This is an extremely sharp and realistic question. In the crypto derivatives market (i.e., cryptocurrency futures/perpetual contracts), “long-term survival” itself is a highly challenging goal, because this is a “negative-sum game” market (fees, funding rates, and liquidations constantly drain money from the pool), and the volatility, uncertainty, and aggressiveness of your counterparts far exceed those in traditional financial markets.

If you define “long-term survival” as avoiding liquidation, being able to continuously participate in the market, and ultimately achieving stable profitability, then the following is a set of principles and strategies that require systematic construction. Be acutely aware that this may be one of the hardest survival games in the financial world.

Core overarching principle: Treat contract trading as a “risk business,” not a “get-rich-quick gamble.”

A shift in mindset is the first prerequisite for survival. You are not a gambler; you are a risk-management entrepreneur. The goal of the business is to seek the best risk-reward opportunities while controlling your maximum losses.

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I. The Cornerstone of Survival: Capital and Risk Management (Protect Your Principal)

This is the single most important aspect of long-term survival, more important than any technical analysis.

1. Always use “money you can afford to lose”:
· Never use living expenses, house payments, or borrowed funds.
· It is recommended to use only a very small portion of your total financial assets (for example, no more than 5-10%). Even if this amount is completely lost, it will not affect your life or core assets.
2. Strict and scientific position management (position sizing):
· Single-trade risk exposure principle: The preset maximum loss for any single trade should not exceed 1%-2% of your total trading capital. For example, if you have $10,000 in trading funds, each trade should risk no more than $100-$200.
· How to calculate: Position size = (Total Capital * Risk Percentage) / (Entry Price - Stop Loss Price). This forces you to use smaller positions in highly volatile markets.
· Never go all-in at once: Especially under high leverage, going all-in is suicide.
3. Always set stop losses and execute them strictly:
· A stop loss is a “breathing valve” and “fuse.” Trading contracts without a stop loss is like holding a time bomb.
· Stops should be set based on technical analysis (support/resistance, structure break), not just any random percentage.
· Once a stop is hit, you must accept it. Don’t move the stop, don’t “wait and see.” Getting lucky once will sow the seeds for a bigger blowup in the future.
4. Use leverage cautiously and understand its essence:
· Leverage is a double-edged sword; it amplifies not only returns, but also the impact of volatility on your position and your emotional swings.
· Survival suggestion: In a clear trend, use low leverage (e.g., 3-10x). High leverage (20x and above) should only be used for very small positions and extremely high-confidence short-term opportunities, and must be paired with very tight stops.
· Remember: The level of leverage doesn’t determine how much you can make, but how many times you can be wrong.

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II. Trading Strategies and Skills: Seeking a Probabilistic Edge

1. Establish and stick to a positive-expectancy trading system:
· The system should include: a market analysis framework (when to enter), clear entry signals, explicit stop loss points, and clear take profit/exit strategies.
· The system can be based on: trend following, range trading, breakout pullbacks, etc., but it must be logically consistent and backtested against historical data (even if only manually reviewed).
2. Deeply understand market structure:
· Multi-timeframe analysis: Use higher timeframes for trend direction (daily/4-hour), and lower timeframes (1-hour/15-minute) to find entry points. Avoid blindly longing rebounds in a major downtrend.
· Identify key levels: Important support/resistance, prior highs and lows, areas of heavy volume. These are often potential areas for stops and reversals.
3. Pay attention to market sentiment and on-chain data:
· Fear & Greed Index: Extreme greed often marks the top, extreme fear may be the bottom (but don’t blindly bottom-fish).
· Funding rates: In perpetual contracts, extremely high positive funding (longs paying shorts) indicates an overcrowded market and risk of a pullback; extremely low negative rates indicate the opposite.
· Liquidation heatmaps: Watch for areas where stop orders cluster, as these zones act like magnets that can draw price in and trigger cascading liquidations.
4. Learn to wait and forgo most opportunities:
· The market spends 90% of its time ranging or trendless. Most losses occur during these periods.
· Only trade the clearest, most confirmed signals within your system. “Patience” is the most underrated trading quality.

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III. Psychological and Disciplinary Cultivation (Conquering Yourself)

1. Make a trading plan and trade according to the plan:
· Before entering a position, write down the plan: Why enter? Where is the stop loss? What is the target? How large is the position?
· Never make spur-of-the-moment decisions during trading. Emotions (greed, fear, regret) are the biggest enemies in trading.
2. Keep trading records and review them:
· Record every trade in detail: profit/loss, reason, emotional changes.
· Regularly review: Analyze the commonalities of winning trades and whether losing trades are normal system losses or mistakes due to rule violations. Continuously optimize your system and discipline.
3. Accept that losses are part of the cost:
· Even the best system has losing streaks. As long as single-trade risk is controlled, small consecutive losses won’t hurt you. Don’t abandon your system or revenge trade due to a few losses in a row.
4. Maintain physical and mental health, and life balance:
· Do not trade when sleep-deprived, stressed, or when life is not going well. Your judgment will be severely impaired at these times.
· Contract trading is extremely mentally taxing; you need other hobbies to balance life and avoid having your emotions hijacked by the charts.

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IV. “Survival Traps” to Watch Out For

1. “Recovering Losses” mentality: Trying to make it all back in one big trade after a loss is the fastest way to get liquidated.
2. Overtrading: Forcing trades when there are no opportunities, trading just for the sake of trading, or simply to feel involved.
3. Believing in a “Holy Grail” or “Trading Guru”: No one can predict the market 100% of the time. Copy-trading or blindly following influencers is putting your fate in someone else’s hands.
4. “Gambling on Direction” in extreme markets: Before major news releases or during wild volatility, the market is irrational—trading at these times is no different than rolling dice.

Summary: The Formula for Long-Term Survival

Long-term survival = Extreme risk management × Probabilistic edge trading system × Ironclad discipline

Finally, keep asking yourself one question: In a game where most people are destined to lose, what makes me one of the very few who survive? Your answer should be the specific, actionable principles and discipline above—not “I think I can” or “I’m lucky.”

The crypto derivatives market is a battlefield; surviving is already difficult, and achieving stable profits is even harder. If, after trying, you find you cannot strictly adhere to the above principles, then the best long-term survival strategy may be: stay away from contracts, only do spot investing, or leave the market entirely. This is not shameful—it is the most responsible decision you can make for your wealth and your life.