Duan Yongping's Lessons: Why Most Crypto Investors Fail While Value Investors Succeed

Amidst the devastation of the crypto market, where “diamond holders” are ruthlessly punished and lamentations fill the networks, there is a fundamental gap between how stocks are invested in and how cryptocurrencies should be invested in. Duan Yongping’s philosophy offers an uncomfortable mirror to understand what we have done wrong.

The fundamental mistake: confusing speculation with investment

Duan Yongping’s investment philosophy is built on a simple truth: monetize knowledge. It’s not about betting or speculating, but about using deep understanding to capture value that the market has undervalued.

In today’s crypto world, this concept is inverted. 99% of participants have heard of “value investing,” but less than 1% truly understand what it means. When Duan Yongping talks about buying a company, he refers to understanding its future cash flow, business model, competitive defenses, and team quality. In crypto, this translates to questions almost no one asks: Can this project survive multiple cycles? Is the team pursuing passing narratives or genuinely seeking product-market fit? Is the tokenomics a Ponzi trap in disguise or capturing real value?

The uncomfortable truth about “margin of safety”

This is where most crypto investors make their most costly mistake. The margin of safety is not the low price. Something cheap can become even cheaper, even reaching zero.

The true margin of safety, from Duan Yongping’s perspective, comes from depth of knowledge. When you understand better than the market, short-term volatility is just noise — or better yet, a buying opportunity. But in crypto, most holders are simply trapped, holding out of inertia. Novices buy at peaks and sell at valleys. The concept of real margin of safety doesn’t even exist.

A true crypto investor should ask: Have I verified that the project’s fundamentals haven’t changed? Is the team still actively building? Is the value genuinely undervalued? Only if the answer is yes to all three questions, is the drop a real opportunity, not a trap.

The invisible discipline: knowing what NOT to do

Duan Yongping has a rule that should be carved in stone in the crypto world: knowing what not to do is more important than knowing what to do.

His exclusion list is clear: he doesn’t touch what he doesn’t understand, overly complex projects, teams with problematic backgrounds, tokenomics designed as short-term schemes. While everyone else asks “where is the next opportunity?”, he asks “what traps do I avoid at all costs?”.

This defensive mindset is the opposite of the dominant crypto culture. Novice investors see a new token with an attractive narrative and act impulsively. More experienced ones copy the moves of other KOLs, always arriving late, never knowing when to exit. The result is predictable: losses.

Trust as the rarest asset

There is a principle of Duan Yongping that manifests brutally in crypto: once trust is broken, nothing said afterward is credible.

He abandoned his positions in Xiaobawang when the promise of stock compensation was broken. Trust evaporated. In crypto, we experience this constantly: teams that flee with funds and reappear under another name to scam again. Serious investors need a “blacklist” — teams that stole, KOLs that manipulated, protocols with fatal vulnerabilities. These should never be touched twice.

Alignment of values: the factor no one considers

Duan Yongping insists that companies should choose people — and investors should choose companies — based on shared values, not just potential returns.

The structural problem in crypto is evident: 90% of teams want to cash out and run, while retail investors dream of instant wealth. No one asks if this has real value. This misalignment of values is what condemns most projects to failure.

Long-term thinking as a competitive advantage

While most are obsessed with candlestick charts, technical analysis, and short-term trading, the true investor monitors what matters: GitHub updates, technological innovation, community activity, product iteration speed.

Duan Yongping says that if you truly understand a company, the cash on hand makes you uncomfortable — it’s depreciating paper. But in crypto, most don’t have that certainty. However, for those who do, the strategy should be simple: consistent DCA into Bitcoin, Ethereum, SOL — projects whose technology and teams have proven to endure through multiple cycles.

Innovation and bubbles: an inevitable marriage

In his reflection on artificial intelligence, Duan Yongping recognizes that all real innovation is accompanied by bubbles. He invested in Nvidia not to speculate, but to “participate a little” — to not miss the real change while accepting there will be excessive speculation.

The same applies to AI + Crypto. The bubble is certain, innovation will happen too. The question is whether you have the wisdom and conviction to “invest a little” without being consumed by FOMO.

Final advice: integrity as the true defensive moat

Duan Yongping’s principles may seem simple on the surface — integrity, honesty, long-term vision — but they have proven to be the most effective defensive moat over decades. They are the opposite of everything dominating crypto today.

The market is never short of opportunities. What’s missing is the vision to identify them and the strength to hold your positions when everyone panics and sells. For those who still believe in the long term, these principles are not just wisdom — they are survival.