How much is too much?

[beveryu778]

There is no single too much, but the most important point is to hold only the sum that should be actively used to trade in a CEX. Once you have built a balance greater than this, then you are risking more needlessly. Exchanges may be frozen, hacked, and update policies at any time -and that is beyond our control.

The best thing to do would be to draw profits on a regular basis and only trade with the capital it sets. In that case, in case of the drop in the exchange, you do not lose your profit. On a personal level, I would not want to lose the money in the CEX and not being bothered by it, so I already have more than I need to leave in the CEX.

[Wakate]

Wakate you are correct, as a trader you need to have more than one cryptocurrency that you are holding, you can't be trading using only one crypto coin if you do that you are not a good trader and you won't make money from trading, I see some people saying they will only focus on Bitcoin because it's less risky when you are trading for me you are making a very big mistake if you want to make money from trading you won't even focus on Bitcoin right now bitcoin is meant for accumulating and holding for a very long time if you want to trade and make money from trading you should go for new cryptocoin and you have to be very smart and always ready to trade and make your profit at any time.

The only way people can make money in the crypto market is when their is liquidity. Market without a liquidity can never be profitable for traders and that is why people are finding it very difficult to trade this current market because of lack of liquidity. Traders always look for ways to make money and the only way the money can be made is through trade different crypto tokens for broader profits.

[PX-Z]

"Too much" is anything you can't afford to lose.

General rule, which can he seen on the internet, that only put or invest 1–5% of your net worth into crypto if you're new in the space. For active trading, say day trading or similar, risk 1–2% of your trading capital per trade, not the whole account.
If losing the money will affect your bills, daily budget, savings goals, or even your very mental health, you're trading too much.

[lixer]

Talking about FTX exchange make us little frustrated how easily the top market bankrupt and many user loss much money without any refund yet from the exchange developer. Right now Sam have been Sam Bankman-Fried is being imprisoned and not has any ideas yet from him to refund the FTX user money, I think its important for us how to manage large amount if fully hold in CEX exchange if any bad possibility can't withdraw yet and many exchange owner run away after bankrupt or get collapse.

Bit confusing between save assets in wallet or CEX exchange, if you are trader maybe difficult to trade if fund saving in wallet and must sent to CEX exchange, some time have good moment when market get lower price maybe sending to CEX exchange from wallet take few moment and has possibility miss dip buy at lower price.

But, we have to accept the fact that after the downside of FTX, many rules and regulations were bought in place and now all of the centralized exchanges are forced to follow the guidelines. They also are informed to keep enough liquidity outside the exchange so that they can insure the traders and can return the funds in case something goes bad. This made me trust centralized exchanges again and I will not mind keeping my money on a few trusted exchanged which follow the regulations and offer security to our funds.

Storing money in our wallet will always be a better choice if we are not anticipating in trading. But for trading, we have no other option but to keep all our money on these exchanges. We should carefully study the exchanges and should be up-to-date with their news or updates.

[DYING_S0UL]

I also trade on Binance and keep some of my funds that are not involved in trading on Earn at about 10% per annum. In addition to this small profit, the USDT placed in Eearn allows me to receive additional points in the Binance Alpha program.

Sorry, what's this "Earn at about 10% per annum"? I have only recently started using this platform and it has so many extra things one can do that I never could explored or had the time to. So I'm not aware of what you are referring to. Can you please elaborate a little?
As for the Alpha program, I saw some members from my local board started doing it, but I didn't, because the competition was just fierce I have heard. Also the fact that it was "first come, first serve" discouraged me.

"Too much" is anything you can't afford to lose.

If losing the money will affect your bills, daily budget, savings goals, or even your very mental health, you're trading too much.

It doesn't,

and the amount I am using is solely for trading. Profiting from it or loosing it doesn't effect my daily life or anything.

[Emitdama]

Some people afford to lose $10k some can't afford to lose $1 it's different risk appetite for every person and OP is the one that should know what his risk appetite is.
I usually put what money I can afford to lose and call it a day too, if the exchange collapse then I won't be too desperate, after all I always take my initial balance if I make quite good profit to minimize risk of something like FTX happening again.

I advise OP to slowly think about how much you can afford to lose and that is the amount that is considered safe to be put in CEX. Always consider the worst scenario.

Even if we are prepared to loose the money kept aside, we will still feel bad on losing the money not because of our fault right? We have a basic mentality of regretting decisions so even if we loose a small portion, we will still regret the decision and blame the exchange for not taking utmost care of security.

We should always be prepared for the upcoming because in cryptos we can't really be sure our money will be 100% secure at least until we store them in cold storage or offline wallets. Even our online wallets can be compromised and the funds once lost can hardly be recovered. Investing only what we can afford to loose will help us create the mindset and it will also not mess our financial life if things go haywire but we are still going to feel bad and we will blame the exchanges for that.

[PX-Z]

It doesn't,

and the amount I am using is solely for trading. Profiting from it or loosing it doesn't effect my daily life or anything.

You are in the right track then. And should continue to that. Avoid of compound trading too if you are just new so you are in controlled risk and losses don't get out of hand. Stick to manageable trades first if you're just new (since everyone starts as new) so you stay in full control of your risk.
Once you're more experienced and confident in your strategy, then you can consider compounding to boost your profits, but only when you fully understand what you're doing because it can easily liquidate your assets if you do it wrong.

[tvplus006]

Sorry, what's this "Earn at about 10% per annum"? I have only recently started using this platform and it has so many extra things one can do that I never could explored or had the time to. So I'm not aware of what you are referring to. Can you please elaborate a little?
As for the Alpha program, I saw some members from my local board started doing it, but I didn't, because the competition was just fierce I have heard. Also the fact that it was "first come, first serve" discouraged me.

Yes, now the Binance Alpha program really does not allow you to get a good profit due to the large number of participants, although when the program started in May-June, it was possible to get about $ 1,000 per month from one account.

As for the placement of free funds in staking, you need to go to the "Earn" section - https://www.binance.com/en/earn and there you can choose the pool you are interested in.

[DYING_S0UL]

Sorry, what's this "Earn at about 10% per annum"? I have only recently started using this platform and it has so many extra things one can do that I never could explored or had the time to. So I'm not aware of what you are referring to. Can you please elaborate a little?
As for the Alpha program, I saw some members from my local board started doing it, but I didn't, because the competition was just fierce I have heard. Also the fact that it was "first come, first serve" discouraged me.

Yes, now the Binance Alpha program really does not allow you to get a good profit due to the large number of participants, although when the program started in May-June, it was possible to get about $ 1,000 per month from one account.

As for the placement of free funds in staking, you need to go to the "Earn" section - https://www.binance.com/en/earn and there you can choose the pool you are interested in.

I guess the IDO hype stole the show. I had joined a few IDO's back then. But Binance made the rules more stricter after abuses like multi accounts, bots etc. And after that came the Alpha program, which I already knew, if I participated, I'll be crushed by the big players. So I didn't even bother doing it. Seemed waste of money and time to me.

Ow you meant staking! I haven't explored that option yet. If possible can you share your personal choices and how much you have staked and the pools?

[bigimann]

How much is too much?  Nothing is ever too much for us man, we all are bunch of greedy and selfish creatures man,. If you study Maslow's hierarchy of needs closely, you'll know that human wants can never be satisfied.

Could you tell how much would be too much for you?

The reply you're looking for lies on your ability to answer the above question ☝️

Cheers man!

[Mpamaegbu]

~snipped~

...we don't just compete with people in things like this, as long as we are not of the same level with them financially, we should do things within our financial strength to avoid regretting our decisions later.

Exactly! You got the point. There shouldn't be any form of competition with anyone on how one plays in this industry. That's why I posited that everyone should bear what they can afford to lose since you're the one who know your financial capability.

~

I also trade on Binance and keep some of my funds that are not involved in trading on Earn at about 10% per annum. In addition to this small profit, the USDT placed in Eearn allows me to receive additional points in the Binance Alpha program.

I find the percentage on "Earn" very ridiculous and that's why I don't consider using that feature at all. I've never used it on Binance or on any other new Cexs. In the past (around 2017/18, I used to lend on Poloniex and it was a good commission to earn. I experimented with a few coins then, including Dogecoin and got well rewarded. I don't know why these new exchanges don't encourage users with mouth watering percentages.

BTW, I don't even know what to make of the Alpha points on Binance. I've some points even without farming them. I guess it's from my spot activities there. The few times I tried to go through it to understand what it's all about, I failed.

[tvplus006]

...BTW, I don't even know what to make of the Alpha points on Binance. I've some points even without farming them. I guess it's from my spot activities there. The few times I tried to go through it to understand what it's all about, I failed.

Obviously, you receive Alpha points in the amount of 1-3 points per day, depending on your account balance. But this amount is not enough to receive an airdrop, as you still need the trading volume of Alpha tokens, for which Alpha points are also awarded.

If you really want to understand the Binance Alpha program, then you will need these few links:
https://www.binance.com/en/support/announcement/detail/07e8c812091a49ae9eefaeabe3c35f53
https://www.binance.com/en/support/faq/detail/12e7f2e555704f9c8e852d1c1afb032a
https://www.binance.com/en/square/post/29580333407289

[Achalugo BTC]

You are the one to know how much is too much for you. Any amount that you may lose if the CEX exchange goes crazy or you they get scammed/hacked and the loss affects you negatively financially and emotionally then that amount is too much to leave on the CEX exchange.
You have good reason to keep your funds on the CEX exchange but no reason will make sense if you lose a reasonable part of your funds so you have to.be very careful.

Absolutely correct, being cautious beats any excuse. That is why people are always advised to keep the amount they can afford to lose just incase the exchange are being hacked, they won't feel much about the money.

Also, people should try a get a trustable wallet or exchange that they can leave any amount of their choice maybe for their future purpose.

[bitgolden]

being cautious beats any excuse. That is why people are always advised to keep the amount they can afford to lose just incase the exchange are being hacked, they won't feel much about the money.

Also, people should try a get a trustable wallet or exchange that they can leave any amount of their choice maybe for their future purpose.

But we still can't cut short the money we want to trade with because it might impact our trading volume which will adversely affect the profits. At the end we do not have much of a choice here if we want to still continue trading. We will have to trust the platform and keep the money there so we can open a trade anytime we see an opportunity. A good way here can be to move the profits out as soon as we close the trade so we can at least secure the profits and continue trading with the main capital invested.

Moving the profits to an external wallet can be recommended but moving the profits out to some other exchange will not really help secure the funds because even that exchange might go bankrupt and the funds stored there can be inaccessible.

[jaberwock]

Avoid of compound trading too if you are just new so you are in controlled risk and losses don't get out of hand. Stick to manageable trades first if you're just new (since everyone starts as new) so you stay in full control of your risk.
Once you're more experienced and confident in your strategy, then you can consider compounding to boost your profits, but only when you fully understand what you're doing because it can easily liquidate your assets if you do it wrong.

For me compounding has always been a risk because I prefer investing only what I can afford to loose. The profits from trading are immediately moved out by me and I prefer using them for some other forms of investments. I will not keep on trading just because I want to make a good fortune here but I would look for a steady growth.

I can't deny the fact that compounding can make us maximize the profits in a really short term but it also does mean that we are risking our 100% portfolio just because we want to get rich soon. Getting rich soon always comes with it's own consequences so I would prefer a slow but steady growth. I will only trade with the original invested capital and will not considering adding my profits to the capital. Profits will always have a different wallet for me.

[Floxynice]

@op, I just hope this my recommendation will be useful to you. You should decide how much you wish to set aside as your working capital. That should be the amount you trade actively with; any other excess amount realised as a result of profits accrued should be transferred into a safe wallet. Learn to always withdraw your profits, that is your real gain.

As for how much is too much, I can't say for you. You should check yourself, your net income, how much you can afford to lose and your risks tolerance. Analysing all of this properly will help you decide how much you feel is okay for you to keep in a CEX.

[DYING_S0UL]

Avoid of compound trading too if you are just new so you are in controlled risk and losses don't get out of hand. Stick to manageable trades first if you're just new (since everyone starts as new) so you stay in full control of your risk.
Once you're more experienced and confident in your strategy, then you can consider compounding to boost your profits, but only when you fully understand what you're doing because it can easily liquidate your assets if you do it wrong.

For me compounding has always been a risk because I prefer investing only what I can afford to loose. The profits from trading are immediately moved out by me and I prefer using them for some other forms of investments. I will not keep on trading just because I want to make a good fortune here but I would look for a steady growth.

I can't deny the fact that compounding can make us maximize the profits in a really short term but it also does mean that we are risking our 100% portfolio just because we want to get rich soon. Getting rich soon always comes with it's own consequences so I would prefer a slow but steady growth. I will only trade with the original invested capital and will not considering adding my profits to the capital. Profits will always have a different wallet for me.

I wouldn't dare doing compound trading as I had bitter experience with that in the past. Not that I only lost my profits as well as a big portion of my main capital, So this time I'm more focused on a fixed amount for trading. For example, consider 500 bucks as starter. And after I gain some profits, I'm converting it into stable, lastly when it's a decent amount I'm using p2p to cash out. As everyone else are concerned, I'm not also comfortable in keeping any unused decent amount in cex. So, I'll rather convert it into cash or move to personal wallet.

[xLays]

For me, it becomes too much when you start using money that you shouldn’t be using for trading. What I mean is, you end up touching funds that were never meant for trading.. In short you're out of control..

It’s something similar to gambling addiction. Imagine using money that should already be used to pay your bills but you end up that money for trading, then the coins suddenly dump.. If you feel guilty everytime, that’s a sign it’s already too much.

[DYING_S0UL]

For me, it becomes too much when you start using money that you shouldn’t be using for trading. What I mean is, you end up touching funds that were never meant for trading.. In short you're out of control..

It’s similar to gambling. Imagine using money that should already be used to pay your bills but you end up that money for trading, then the coins suddenly dump.. If you feel guilty everytime, that’s a sign it’s already too much.

As I already, many times made it clear in this very thread, that I am using funds that won't effect my daily life, you should not worry. And I'm not worrying either. I have kept those funds there specifically for trading purpose. And even if I face loses, it certainly wouldn't make me homeless or out of electricity or food or anything. I have other means to survive and let's say I'm only trading to make a few bucks extra.

The market is already dumping so much, everything is as red as blood. So I have stopped as of this moment, it's too risky. I might trade again after the bloodbath stops...

[mvdheuvel1983]

For me, it becomes too much when you start using money that you shouldn’t be using for trading. What I mean is, you end up touching funds that were never meant for trading.. In short you're out of control..

It’s something similar to gambling addiction. Imagine using money that should already be used to pay your bills but you end up that money for trading, then the coins suddenly dump.. If you feel guilty everytime, that’s a sign it’s already too much.

The first sign you notice that something is becoming too much is is when you start doing things you shouldn't do let's say you know the particular amount you keep aside for trading and no matter what you have you don't go beyond that figure but the moment you move away from your initial plan and start adding more money to the amounts set aside for trading that's the sign of too much for me. You have funds you use for trading you don't need to add more money to use in trading when you feel comfortable doing what you know will hurt you and your feelings when it goes bad it's already a big sign that you are doing something more than what you are expected to do.