Bitcoin 10 Years Ago: Crossing the $1000 mark / Lessons Learned

[stockscalper]

We're about a month away from the 10 year mark from when bitcoin crossed $1000 for the first time.

Back then I was a 24 year old professional trader in NYC and I was the only person on my prop desk who was actively trading bitcoin. Here are some of the lessons/observations I learned:

1. Bitcoin/crypto (to me it was just bitcoin) was the wild west of trading and that comes with a ton of risk and opportunity. The risk is you have your money in the wrong spot, it can disappear without any wrongdoing on your part--counterparty risk. I had my money on MtGox briefly but thankfully I moved it to Bitfinex b/c BFX had leverage. Back then BFX was a nascent exchange ran by one French guy in his basement and it had a lot of glitches--for example btc would trade at $80 and I could get executed at $20 with some crafty order placement. Didn't happen often but I made a few thousand risk-free just with these print through executions. Nowadays bitcoin isn't nearly as thin or volatile and exchanges aren't glitchy -- I don't/can't trade it the same way because I don't have the same edges.

2. I thought most "btc investors" were just dreamers/cultists back then. This gave me the mental flexibility to trade bitcoin without getting too attached. Little did I know, the "dream" would become very, very real with bitcoin going over $10,000 in 2017 and over 50,000 in 2020. While my returns as a trader are pretty solid, they don't come close to the returns of someone who simply held bitcoin at the time I first started trading it with serious risk at $250. That's ok though, I have no regrets. And I've actually become a believer myself, holding a few coins as a buy/hold investor.

3. I come from a very active trading background. I day trade stocks on a short timeframe, back then even a micro timeframe where I'd hold for 10-20 minutes max on my scalps. I tried to apply this strategy to bitcoin by scalping very harsh dips and selling into the rallies and it worked but it was extremely stressful. The scalping setup equivalent of bitcoin might take an entire day to play out and that's an entire day of monitoring the market depth and price. I'd often take my laptop everywhere and set alarms at night, which at the time there was only one--a site called bitcoinity where it played the Darth Vader NOOOOOOOOOOOO soundbite from Revenge of the Sith. That shit was a nightmare.

Anyway, I've been writing about my adventures in trading and just wrote about my 2013 experience trading bitcoin in this post: https://churningandburning.com/2023/10/bitcoin-ii-the-no-awakens.html -- I met an executive at BitInstant (almost got to invest with Charlie Shrem before he got arrested!) via another friend on my desk and we both traded 400 bitcoins in October 2013. We ended up outperforming buy/hold on bitcoin (for that given timeframe) by 4x magnitude through a combination of active trading (scalping 20-25% dips using leverage) and lending out USD on bitfinex. Needless to say I lost a lot of sleep.

Hoping for another bull market soon!

[wajik-tempe]

Back then, the unpredictable and dangerous character of bitcoin markets resembled the wild west, necessitating both daring and prudence. Your wise choice to shift your cash from MtGox to Bitfinex was a watershed moment, and the problems you used to your advantage illustrate the type of agility required in such a volatile market.
Your initial suspicion about Bitcoin investors being dreamers or cultists underlines the digital asset's transformative potential, which has grown from a niche notion to a worldwide phenomenon. Your trading profits may not have equaled those of Bitcoin holders, but your transformation into a buy-and-hold investor demonstrates a greater conviction in the technology's potential !

[Doan9269]

If you're comparing bitcoin in 10 years ago to what we have this present time, you will discover there's much to discuss regarding that because bitcoin has always been a well consistently performing digital currency over the years, take a look at the market price, the market cap, it's volatility and diverse opportunities that got birth through this digital currency adoption, see to the trends and look on how it moves from $100 to $1000 and thereafter on how it has been over $10,000 to its all time high of $68,000 and also how we are moving hence from there to a new ATH after next year halving.

[stockscalper]

Back then, the unpredictable and dangerous character of bitcoin markets resembled the wild west, necessitating both daring and prudence. Your wise choice to shift your cash from MtGox to Bitfinex was a watershed moment, and the problems you used to your advantage illustrate the type of agility required in such a volatile market.
Your initial suspicion about Bitcoin investors being dreamers or cultists underlines the digital asset's transformative potential, which has grown from a niche notion to a worldwide phenomenon. Your trading profits may not have equaled those of Bitcoin holders, but your transformation into a buy-and-hold investor demonstrates a greater conviction in the technology's potential !

I have a daytrader's DNA so it was very hard early in my career to be a buy and hold guy. I wanted to get in and out of things quickly. Even holding bitcoin for 2 months from the run from $200 to $1000+ was an extremely stressful journey for me. I can't stand 35-50% drawdown on my positions, it's anathema to me. Only later in my life with more financial security was I able to just put a little bit into bitcoin long-term and let it sit there. Seeing bitcoin stay relevant for as long as it has also changed my early point of view--it's the gold standard or blue chip tech stock (think AAPL) of crypto.

[Lakai01]

[...]
 see to the trends and look on how it moves from $100 to $1000 and thereafter on how it has been over $10,000 to its all time high of $68,000 and also how we are moving hence from there to a new ATH after next year halving.

However, for the sake of honesty, it should be noted that the bearish phases that followed the ATHs were very bloody. I still remember the first crash from $1000 to just under $100. That was my first year as a bitcoin hodler and it was hard to digest the days and nights when you saw your portfolio shrinking day by day. In the meantime, I am much better able to deal with sharply declining prices, always hoping that the next bull run will surely come.

Such phases as right now where Bitcoin again and again strongly swings upwards make me happy, even if I do not assume a long-term upward trend for now. Like you, I see it at the end of 2024/beginning of 2025 at the earliest.

[dunfida]

Back then, the unpredictable and dangerous character of bitcoin markets resembled the wild west, necessitating both daring and prudence. Your wise choice to shift your cash from MtGox to Bitfinex was a watershed moment, and the problems you used to your advantage illustrate the type of agility required in such a volatile market.
Your initial suspicion about Bitcoin investors being dreamers or cultists underlines the digital asset's transformative potential, which has grown from a niche notion to a worldwide phenomenon. Your trading profits may not have equaled those of Bitcoin holders, but your transformation into a buy-and-hold investor demonstrates a greater conviction in the technology's potential !

I have a daytrader's DNA so it was very hard early in my career to be a buy and hold guy. I wanted to get in and out of things quickly. Even holding bitcoin for 2 months from the run from $200 to $1000+ was an extremely stressful journey for me. I can't stand 35-50% drawdown on my positions, it's anathema to me. Only later in my life with more financial security was I able to just put a little bit into bitcoin long-term and let it sit there. Seeing bitcoin stay relevant for as long as it has also changed my early point of view--it's the gold standard or blue chip tech stock (think AAPL) of crypto.

If you've been dealing up with FOREX/STOCKS day trade on which having  that 35-50% drawdown does really signifies that you arent really that good at it.  Im not really that totally comparing out traders to other traders but you arent really that much that confident on daytrade but still if it does resulted out positive for you or profitable then you are just dong fine but its true that when it comes to stress then there's nothing that could be able to beat out and this is something normal but of course it is one of the reason on why trading is never been an easy venture.

Now in talking about to those who had been able to hold up their coins a decade+ which its an amazing feat, for those who are aware of their stash then it did really paid off well.
But there are those holders who had really just that remember their wallets or just got out from prison and remember their coins then its an another scenario.
This is the beauty for those who do took up the risks specially into those early years or on the time that it was really just still starting.

[GeorgeJohn]

If you're comparing bitcoin in 10 years ago to what we have this present time, you will discover there's much to discuss regarding that because bitcoin has always been a well consistently performing digital currency over the years, take a look at the market price, the market cap, it's volatility and diverse opportunities that got birth through this digital currency adoption, see to the trends and look on how it moves from $100 to $1000 and thereafter on how it has been over $10,000 to its all time high of $68,000 and also how we are moving hence from there to a new ATH after next year halving.

This is to tell you that bitcoin doesn't have devaluation, but people who don't when bitcoin starts do make comparison of bitcoin values with this present time, actually in 2009 when bitcoin was introduced and been launched the value was nothing but later run the price skyrocket base on awareness throug internet, so since then bitcoin has been moving from one step of value to another

And bitcoin has not fall to extent of reaching the value in 2010 and 2011, so that is while investors said that long-term investment is best investment you can do in bitcoin as well, so what I wanted us to understand is that Bitcoin does not lost value.

From the time the price of bitcoin was increasing gradually to extent of reaching ten thousand dollars [10k] its a sign that bitcoin will reach to unexpected value one day, now bitcoin is still at range of twenty nine thousand and thirty thousand [29k-30k] people will not purchase and hold but if bitcoin reach hundred thousand right now you many people blaming themselves not to invest in bitcoin.

So longterm investors are the people that benefit cryptocurrency investment and especially bitcoin, so it's nice to invest in bitcoin and allow it for long period of time, because is obvious that the more bitcoin increases the more you are making more profit in your bitcoin investment.

[stockscalper]

If you're comparing bitcoin in 10 years ago to what we have this present time, you will discover there's much to discuss regarding that because bitcoin has always been a well consistently performing digital currency over the years, take a look at the market price, the market cap, it's volatility and diverse opportunities that got birth through this digital currency adoption, see to the trends and look on how it moves from $100 to $1000 and thereafter on how it has been over $10,000 to its all time high of $68,000 and also how we are moving hence from there to a new ATH after next year halving.

This is to tell you that bitcoin doesn't have devaluation, but people who don't when bitcoin starts do make comparison of bitcoin values with this present time, actually in 2009 when bitcoin was introduced and been launched the value was nothing but later run the price skyrocket base on awareness throug internet, so since then bitcoin has been moving from one step of value to another

And bitcoin has not fall to extent of reaching the value in 2010 and 2011, so that is while investors said that long-term investment is best investment you can do in bitcoin as well, so what I wanted us to understand is that Bitcoin does not lost value.

From the time the price of bitcoin was increasing gradually to extent of reaching ten thousand dollars [10k] its a sign that bitcoin will reach to unexpected value one day, now bitcoin is still at range of twenty nine thousand and thirty thousand [29k-30k] people will not purchase and hold but if bitcoin reach hundred thousand right now you many people blaming themselves not to invest in bitcoin.

So longterm investors are the people that benefit cryptocurrency investment and especially bitcoin, so it's nice to invest in bitcoin and allow it for long period of time, because is obvious that the more bitcoin increases the more you are making more profit in your bitcoin investment.

I mean no offense here but is English your first language? I cannot tell what you're trying to say.

[pooya87]

3. I come from a very active trading background. I day trade stocks on a short timeframe, back then even a micro timeframe where I'd hold for 10-20 minutes max on my scalps. I tried to apply this strategy to bitcoin by scalping very harsh dips and selling into the rallies and it worked but it was extremely stressful.

After reading this part I'm now very curious to know how you feel about altcoins. Because this types of strategies are excellent for the shitcoin market where there are flash pump and dumps. They also happen every day with dozens of shitcoins sometimes with massive pumps that can produce a nice revenue if you are willing to take the risks.

[stockscalper]

Just want to bump this topic to say that I've finished my Prop Trader Series, which is a written story (with pictures) about my four years in prop trading called Prop Trader Series.

https://churningandburning.com/category/prop-trader-series

The short summary: I moved to NYC in 2011 to start trading at a well-known prop firm. I struggled to make anything beyond subsistence money for 2 years until a breakthrough in 2013 and I was on track to be one of the best traders there, until a horrible blow-up trade that left me in a big drawdown. Whoops. Then I left because fuck'em, that's why. (not the real reason, you'll have to read it). Bitcoin was kind of a sidequest in all of that, but one with a lot of interesting lessons.