Mindset is one of my favorite topics, as well as human psychology and its understanding, are two key points when investing, and they are much more so when investing in crypto. Since a lot has already been written about human psychology, I preferred to write about mindset.
For organizational reasons, I divided this article into 4 key points:
· Ego
· Meditation
· Moral
· Others
Ego
Ego is that bad belief about our own importance, the need to be “better than” or “recognized for.” It is that distorted image that we make of ourselves, where we are more intelligent or skilled than we really are.
Having a high ego is a problem in any field, but when investing in crypto the problem is bigger, since in crypto the speed at which you will have to accept your mistakes, change your mind, learn new things and acquire new skills is very fast.
A person who believes he already knows everything cannot learn anything new. If you consider yourself an expert in web 3.0, an expert in on-chain analysis, a top trader, a king in navigation narratives, you should reconsider your mentality and be more humble. In a bull market, we all run the risk of feeling this way and deviating from reality.
If your ego is high, you will think that you are too good at trying hard and working hard, so you run the risk of sabotaging your own chances of success, as you will avoid new challenges that allow you to get out of your comfort zone. These new challenges will be avoided because they threaten to knock you off your pedestal or expose you.
If your ego is high, you will not accept advice from anyone and you will always look for an excuse to justify your mistakes, so you will not be able to evolve.
If your ego is high you will not ask anything publicly, for fear of being considered a pleb, the correct thing would be not to take care of appearances.
If your ego is high, you will surround yourself with sycophants, leaving aside the search for friends better than you, who encourage you to improve and learn.
Meditation
Cognitive reflection refers to the ability to question our assumptions/beliefs. People with low cognitive reflection are the most likely to believe in conspiracy theories and fake news. In crypto, people with little cognitive reflection are the ones most likely to be scammed, the ones who fall for a narrative and don’t sell it, basically the most “gullible”.
People’s reflective capacity improves throughout life, but one method to accelerate the process is meditation based on mindfulness, which consists of listening to the body’s sensations and reflecting on them without judging anything.
The practice of meditation improves all elements of the emotional bubble and sharpens intuition.
Intuition is another great friend of a crypto investor. I’m sure you’ve heard many great traders say that part of their decision making is based on intuition. By bringing emotions to the surface of the mind, analyzing their origins and influences, we can treat them as another powerful source of information.
Moral
Morality is the set of rules that each of us has regarding what is right or wrong, knowing ourselves in this sense is important and requires humility so as not to deceive ourselves.
I recommend that you take this moral alignment test: https://www.idrlabs.com/moral-alignment/test.php
I won’t explain the grid of possible outcomes, because it’s pretty easy to understand, but the interesting thing here is that, from my point of view, the people who earn the most by investing in cryptos tend to have their morals inside the green box. , tending more towards Chaotic-Neutral.
Being chaotic, one enjoys speculation, bubbles, ponzis, trying new things and taking risks, which is key in cryptos. And the neutral part is to be neither too good nor too bad, a neutral person will put his own interests first, but does not enjoy the unnecessary suffering of others, as if a bad person could.
If a person is too good, they can be a victim of scams more easily, they can be too “gullible” when it comes to investing, believe in narratives and not sell on time.
If a person is too legal, he may miss out on many crypto plays as he does not enjoy speculation and it causes him stress, so he prefers to avoid it.
Unfortunately, in cryptos evil is usually rewarded, since the legal aspect is almost non-existent and most of the personalities are anonymous. Despite this, in the long term it is not profitable, since you will not be able to forge relationships and a reputation that can open doors for you in the future.
Others
Lastly, I’ll add a couple of points that, while also important, are too brief for their own category and don’t fit into the categories above:
- The ability to change your mind quickly is very important in crypto, ego is the enemy of this and mediation is the friend.
- Clarity is important, as it allows us to separate the noise from what is really important. And with the speed at which cryptocurrencies move, the “noise” is louder than ever.
- Curiosity and growth mindset are also two important mental attributes. Being curious and trying new things is one of the best ways to get alpha in crypto.
- The exchange with other cultures increases the breadth of vision, perhaps because one is forced to forget one’s own prejudices and adopt new ways of thinking.
I guess that’s it, I think a lot of the points focus on trying to see the world as it is, and not an altered version of it, leaving aside ego and biases so that’s a good conclusion too.
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