Crypto Contracts Are Not Gambling, But a Sword-Wielding Underworld – The Survival Law of an Old-School Trader

As someone who has been deeply involved in the crypto market for many years, I always believe one thing: contracts are not for dreamers trying to get rich quickly, but for those who understand what they are doing. Playing correctly helps you “take small wins to big gains”; playing wrong, a single sweep is enough to send you out of the game. This article does not discuss high-level theories, just my hard-earned experiences after paying many school fees. If you are trading contracts or planning to start, read with a mindset of learning how to survive before thinking about profits.

1. The Nature of Contracts: Don’t Be Fooled by Appearances Many newcomers see contracts as something very “high-end,” very difficult. In reality, contracts are just an exaggerated version of spot trading. You don’t need to hold real BTC or ETH, just need to predict whether the price will go up or down to make money. The issue lies in leverage. For example: You have 100 USDT using 10x leverage to long BTC Price increases by 10% → you earn 100 USDT (Account doubled) But if the price drops by 10% → your account is almost wiped out 👉 Leverage is both a tool and a trap. In my opinion, contracts are not about comparing technical indicators, but about comparing: Awareness of trends Emotional control ability Discipline with the planned strategy Anyone who masters these three things will have a better chance of lasting longer.
2. Funding Rate: The Hidden Signal Between Long and Short Sides This is a detail many people overlook, but it is extremely important. Funding rate (Funding fee) is paid every 8 hours, essentially balancing the long and short sides. Positive funding rate: longs pay shorts → The market is overly euphoric, sentiment strongly leaning towards bullishness → Following longs at this time is very easy to get “liquidated” Negative funding rate: shorts pay longs → Pessimism dominates → Don’t rush to buy the bottom without clear signals 👉 My personal strategy: When the funding rate continuously leans to one side, I often consider going against the trend with small volume, because the probability of market reversal is quite high.
3. Leverage: Don’t Ride the Roller Coaster When You Don’t Know How to Swim I’ve seen too many people open 50x, 100x positions with dreams of changing their lives after just one trade. The outcome is usually the same: account burned in minutes. Remember: Higher leverage → lower safety margin Just a 1% price move against you can cause heavy damage I always follow strict rules: For beginners: 3x – 5x, maximum 10x Risk no more than 2% of total capital per trade Don’t look at others showing off high profits with large leverage – that’s a survivor bias
4. The Four Practical Trading Steps I Always Apply Step 1: Identify the Major Trend – The Decisive Day Don’t stare at the 1-minute chart and trade wildly. I always start with the daily chart to identify: Main trend Is the market bullish or bearish Common signals I use: MA20, MA50 trending up MACD crossing up and widening 👉 Critical rule: When the market is rising, wait for a correction to go long; when falling, wait for a rebound to short. Don’t try to be a hero by catching the top or bottom. Step 2: Find Entry Points – The 4-Hour Chart Speaks After identifying the trend, switch to the 4-hour chart to find specific entry points: Price reacting at the middle Bollinger Band RSI exiting oversold/overbought zones Strong volume increase during breakout For example: ETH repeatedly holding support levels, then volume surges and breaks out → high probability long signal. Step 3: Cut Losses Systematically, No Emotions Stop-loss orders are always set before entering a trade, never negotiate with the market. I usually set stop-loss: Below the nearest low/high Add about 2% – 3% to avoid noise Life lesson: Once held a BTC position from the peak down deep, losing more than half the account. Since then, cutting losses is better than losing all capital. Step 4: Take Partial Profits, Don’t Try to Catch the Whole Wave My usual approach: Take about 10% profit → close 50% of the position Let the rest be decided by the market The market offers many opportunities, but survival capital is always limited.
5. Position Management: The Key to Avoid Being Eliminated No coin should exceed 30% of total capital Prioritize 2–3 major coins like BTC, ETH Never increase volume just because of recent gains; control is crucial I once suffered a painful lesson: just making profit, confidently increasing position → a single candle wipeout, gone completely. Conclusion: The Longer You Survive, The Greater Your Chances The contract market does not fear slow traders, it only punishes those lacking discipline. Three principles I always keep in mind: Stop loss is the boundary of survival Leverage is like alcohol – too much will knock you out Always record and review losing trades, because they are the most valuable lessons Contracts are not a race to get rich quickly, but a game to see who can last until the end. As long as you have capital, there is still a chance. Learning and discipline are the greatest assets a trader can have.