Scrolling through my DMs at 2 AM, I saw a message that completely broke me: "Bro, I went all-in with 500,000, even used leverage to chase the hype. Now my account only has 48,000 left. Should I just uninstall the app?" Followed by three crying emojis. I've seen this scenario at least a hundred times in my eight years in the space.

I’ve been in this market since 2017, from the wild ICO days to the long crypto winter, and I’ve seen all kinds of people—finance PhDs who did all sorts of modeling, only to lose their entire house down payment; and market vendors who, using the simplest methods, managed to save enough for retirement. The more time I spend in crypto, the more I realize a harsh truth: the money you make here isn’t from being super smart—it’s from being able to "hold on." The newbies who come in dreaming of doubling their assets almost always end up as someone else’s exit liquidity.

The 3 "deadly traps" newbies love to fall into—see if you’ve hit any of them:

Xiao Lin (the friend who lost 450,000) is definitely not alone. I’ve analyzed hundreds, if not thousands, of loss stories and found that rookie blow-ups almost always come down to these three patterns. If you recognize yourself here, change course fast:

Trap 1: Treating leverage as a "get-rich-quick tool"—when it’s actually the "express lane to liquidation"

A lot of people think if they don’t have much principal, they should use leverage to boost returns. But they forget the real nature of leverage—sure, it feels great when things are going up, but a 10% drop will knock you out. I know a guy who used 5x leverage to chase a hot coin. The market dipped a bit at 3 AM, and he got auto-liquidated by the platform. When he woke up the next morning, his account couldn’t even afford a bottle of booze—he had to borrow money from friends.

My hard rule for myself: newbies should cut leverage completely