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The CEO of Alphractal, Joao Wedson, stated that cryptocurrency investors frequently make the same mistakes. He indicated that losses are often linked to emotional decisions made during market peaks.
Wedson pointed out that the crypto market is experiencing another phase of declining trust in assets. He identified four stages of the market cycle:
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distrust;
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confirmation;
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impulse;
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excess.
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According to his assessment, the most favorable entry points occur during periods of fear and low trading activity. During these times, major players accumulate positions while retail investors remain on the sidelines.
The riskiest decisions, according to Wedson, are made during the impulse growth phase. At this stage, the market experiences rapid growth, the number of participants increases, and the influence of speculative capital intensifies.
“Assets are accumulated in silence, while they are sold against a backdrop of widespread optimism,” he stated.
Wedson emphasized that it is crucial to avoid blindly following trends when operating in the crypto market. Instead, he recommends analyzing market cycles, monitoring liquidity movements, and considering participant behavior.
In his view, data-driven decisions rather than emotional ones help minimize the impact of the “herd effect” and establish a more resilient investment strategy.
Previously, Ethereum co-founder Vitalik Buterin mentioned that many social and gaming blockchain projects are failing for a single reason — developers focus too much on tokens and the technological aspects.
