2024 Crypto Portfolio Performance Review + Reflections

Gm!

2024 flew past in the blink of an eye.

Of Chops and Meat of the Moves

In crypto’s case, we had one of the longest chop-fest this year, from April (halving) to September. While 5 months is pretty short in the grand scheme of investing, its a century in crypto terms. My overall performance were heavily reliant on a few big wins, while majority of the time my portfolio was either chopping alongside the market as BTC dominance grinded higher while 99% of altcoins remained weak.

In hindsight, being long BTC from January to September before switching more aggressively to newer altcoins like MOODENG/GOAT would have generated big returns for those who caught this rotation in size.

This is mostly just my own trading journal for 2024, but overall, this has mostly been a trader’s market more so than a holder’s market. Due to the different macro conditions and global liquidity this cycle, there is heavy dispersion in the altcoin space. Only specific sectors like memes (which did well in Q1-early Q2), and AI-related tokens (Q3/4) did super well, while sectors like Infra and Gaming stagnated or even bled lower.

Dispersion(Alt) Season?

Narrative and price goes hand in hand. And this dispersion in alts this year clearly shows the imbalance between buy-side demand and the unlimited supply of new coins being created every single day. Even with unlimited supply of new coins, most capital are mercenary, meaning the valuation of most coins are just artificial, and will quickly evaporate as newer coins and fresh narratives arise. This is the case of the “static” memes capital rotating towards “AI memes” this year, as now there is tech backing the memes, making it a much more enticing narrative than simply buying a dog with hat or a frog or whatever.

Rotations and Rotations and Rotations

This year’s market is all about rotations. In Q1, the strongest narratives was TIA staking for example, which granted several big airdrops to stakers such as DYM, ALT. But the narrative didn’t last. The market saw a local top in March, when tons of new narratives like SEI and FTM were running but macro conditions meant these were short-lived pumps and people were quick to take profit.

Going into Q2, there were new narratives like Ethena’s ENA launch, as well as various other airdrops like W (Wormhole), TNSR (Tensor NFT Marketplace on Solana), and the infamous FRIEND (Friendtech) airdrop. The L of this quarter for me was entering MAGA with size, which was more of a timing issue mostly. The narrative had legs but Q2 was still too early for election mindshare in hindsight.

There were other massive airdrops in Q2 as well, such as ZK and BLAST, but things simply went downhill from there as we entered a long choppy market. I rotated multiple times early into June, and ate massive losses as the markets chopped. I also de-risked the liquid portion of my meme exposure back into stables and took Ls on many of my alts, and cashed out a pretty significant portion into my bank account to secure gains and used the remaining stables to continue playing.

I also questioned whether $72K BTC was the top of the year back then, since $44K was where the bulk of volume changed hands back then.

August – The Yen Carry Trade

I also took the biggest L of the cycle when August came, with August 5 printing one of the biggest VIX spike and a worldwide derisking event took place. I sold every single altcoin I held until then, but bought POPCATaround $0.4 and PRIME around $7 to hold until Q4. I took down the L I took too, just as a reminder to myself to always focus on risk management:

• Sold PRIME at ~43% loss
• Sold BILLY at -76.7% loss
• Sold MOG at at -60% loss

Then came September, which was the month where I started noticing most people giving up and people on CT calling for 20K BTC. That was the “risk-on” signal I needed, and also a new emerging narrative came with Moo Deng, the pygmy hippo that took over the world. September was one of largest portfolio returners, with my POPCAT going from 0.4 to 0.9 (took profit), and rotating that to MOODENG at $0.05, before selling most of it at $0.2 for a 4x with size.

With the right concentrated bet, I also decided to take profit massively here (second time cashing out) and bought a property with my fiancee to actually secure the gains and change our lives. (We are now homeowners yay!)

October: The beginning of AI Memes

https://x.com/yh_0x/status/1846311159374533038

Following the win on MOODENG, I started going down the Truth Terminal rabbit hole and rotated all my MOODENG into GOAT at around $50M FDV. This was my single best rotation move for the entire year, where I basically got a 10x, and started my rotation game into other emerging AI memecoins. I also recouped all my losses from August with this move as well.

This was the journal I took down back then:

• “Rotate GOAT to fartcoin, first saw at 5.8M mcap, added size at 7m and 14m. Went out with ~3x due to moving in and out.
• Aped into SHEGEN at ~$3.97m mcap, sold 2x
• Re-ape into SHEGEN ~$7.4M mcap, 2x, let moonbag run.

TLDR:

GOAT: called a 14x, took out all Goat 10x, rotate back at 300m mark, concentrate bags to run, then rotated Fartcoin and Shegen into Goat, making average cost 350m mcap. 2x again, rotated initials out into $SOL, remaining left to moonbag

FARTCOIN: Called a 10x, still holding some for the lols

SHEGEN: Called a 7x, pulled out 5x, letting moonbag run

Sold off all SHEGEN, total 6X +

Realised hot hand was running cool, stepped on a few minefields like WORM, TREE, PROJECT89 etc. Took the L, rotated remaining gains into a concentrated bet on POPCAT.”

Most Returns Are From 1-2 Plays With Size

A big lesson I’ve learnt this year is that I really don’t have to consistently find coins that does multiples via spray and pray, but my edge lies in finding 1-2 excellent plays and simply enter with size. Of course entering size on the wrong coin can be portfolio destroying as well, so always focus on risk management, because 1 wrong move can really wipe us out of the game.

Risk Management Is King

I have a personal risk tolerance level that I assign to coins based on their market cap:

< 10M market cap: Max 3%-8% of portfolio allocation

10M-50M market cap: Max 8%-15% of portfolio allocation

50M-150M market cap: Max 15%-30% of portfolio allocation

150M market cap-500M market cap: Max 30%-50% of portfolio allocation

500M market cap: Depends on how new or how Lindy it has become, if conviction levels are high, 50% of portfolio allocation is fine

So you got to have your own risk benchmarks, as the smaller the market cap, the higher the risk of failure. Most coins don’t survive past round number figures, eg. $10M, $50M, $100M, $500M, $1B. A lot of these new coins can also be honeypots, farms, insider infested and many other asymmetric disadvantages, so if you don’t practice risk management, risk of entire portfolio drawdown is very possible.

If you are out of chips to play, it’s game over. Hence why it’s always about how much you get to keep, not how much you make. ATH figures are artificial, they are a fantasy, the number is only real after you take profit. Having $10M uPNL in a illiquid shitcoin does not make you a multi-millionaire until you can pull that $10M out into your bank account, or at least into stablecoins.

Fumble November

November was a massive fumble month for me after my hot streak rotations since September. However, I still managed to make a 3-4x on GRASS TGE, with the gains made from GOAT. Biggest Ws so far is from then was FARTCOIN, LUCE top blast, PIPPIN top blast with size. I fumbled PNUTthough, at 100m top blast, and NOMNOM buy at 5M market cap.

I also gave quite a lot back to the markets due to sector specific dumps, before a massive rug nuke from AI16Z and Eliza while I was asleep. All in all, I still cashed out (third time) 12x my initial capital from the play money I have left back into my bank account here, and continued playing with the rest again.

So while concentrated bets worked for me for most parts of the year, I did get hit by an L with TERRY. It went 35x but I broke my discipline and added more on the way up, in the end roundtripped the entire thing with some losses from slippage.

Hyperliquid

And then the HYPE TGE happened.

If you have been following my telegram channel, then you will know I have fully converted to become a HYPE maxi. Strong PMF, intuitive UI/UX, low latency, zero-gas transactions.. there’s simply very little cons to this except it is currently very centralised (but will change soon as it goes through progressive decentralisation).

Will I miss out on the AI gains? Yeah probably, but I think the clear green pasture is on Hyperliquid. There are still 38.888% of HYPE tokens allocated towards the community for incentives, which is worth multi-billions at current prices.

My guess is HYPE stakers likely will be rewarded, so will users of the new Hyper EVM which is launching early into 2025.

Also another beneficiary is the ongoing PVP airdrop for PVP.Trade, a telegram bot powered by Hyperliquid. Here is how to onboard to PVP.trade if you are currently on Solana:

First, you got to use PVP.trade telegram bot, which is also currently running a points incentive program.
https://pvp.trade/join/ffjitz

Upon activating the bot, go to /start, and copy paste the Solana address and send USDC from your Solana wallet. Take note minimum deposit is 10 USDC if you want to do some test transaction first. It should take about 5 minutes before the deposits come in on Hyperliquid (which is your Arbitrum wallet on the chat)

The amount transferred in will be deposited into the perps margin account on default, so if you are doing spot markets, you have to use the /transfer function — Transfer from Perp to Spot.

Once done, to buy spot tokens you simply have to use /buy, and key in the ticker you want to buy. An example would be /buy HYPE (enter USDC amount). And boom just like that you have bought some HYPE.

I personally still prefer to have manual control over the wallet over using the chatbot. In this case, you can simply go to /settings — Export private key, and import the private key to your Metamask/Rabby/Coinbase wallet etc (any EVM wallet works). Once imported, you should be able to just use the Hyperliquid interface to make trades while farming PVP points.

Take note there is a 0.05% fees on perp positions and 0.5% fees on spot positions when you use PVP.trade as well. So if you are planning to trade frequently on spot for example, just using Hyperliquid without the PVP bot will be better.

https://app.hyperliquid.xyz/join/BEANSTOCK
Code above gets you 4% discount on fees

Conclusion

The main lesson I got from this year was building the habit of constantly cashing out of crypto. I cannot emphasise how important this is. It is so easy to roundtrip the entire gains we have made in crypto, or even from gains flipping into losses, sometimes in the matter of days, or even hours lol.

The gains you make from crypto is also just a reflection of how much edge you have against other market participants. Do you have asymmetric info? Or insider info? Or did you do more DD on the smart contracts or the quality of the codes of the projects? Do you know the founders personally, do you have a good entry with a huge margin of safety? All these are accountable for the vast majority of the gains we make.

Of course there is also luck involved. But luck can only go so far before randomness kicks in and your performance will also mean revert towards zero. This is why it is so important to be taking profit after a big win, because it might simply be the result of luck.

Skills = Edge + Experience in the market. Skill is repeatable. If you are able to 10x your portfolio from 100K to 1M for example once, then it is likely repeatable.

If it only happened once for you and then becomes random results, then it is likely also time to figure out your edge in the market, or basically your Dunning-Kreuger arc.

I think I am also able to take on much more risk right now due to that. It’s all about how to optimise your portfolio so you can remaining rational and not let emotions take control of you.

If I had not cashed out my gains 3 times this year, I’d likely be taking on unnecessary amount of risk right now that can really roundtrip my gains or even put me into losses for the year, or making irrational moves in the market due to the amount of money that can be gone on the line.

But all in all, I still managed to be up 29% versus 2023. I would be better off if I just held Bitcoin yes, but accounting for the cashing out, I vastly outperformed just holding BTC. So in hindsight, my effort and edge paid off.

What will 2025 bring? Let’s wait and see. But I am fully prepared to optimise and win. See you in the arena.

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General Thoughts

Timing the market is not my game; instead, when I invest in a project, I focus on adopting a business owner mindset. My philosophy is that if a company is of high quality and growing, I should consider investing even if it is overpriced. Attractive investments are extremely rare, so get in early and ride the wave, ignoring the noise and investing consistently.

On Market Crashes

This is the one thing that investors and layman alike fear the most. The market will always swing between being overvalued to undervalued, which at the extremes will lead to bull run or market crash, and it is all due to market sentiments of greed and fear in play.

Looking back on history, the stock market experienced a severe (40%) crash every 10-15 years or so on the average. All times, it has recovered and exceeded the previous high within a few years. The same goes for crypto as well, while there are currently only 3 distinct market cycles within crypto that we can refer to, each cycle the market cap trends higher as the asset class continues to mature.

Timing the market may work short-term but not long-term

Some may think a good profit can be made if we sell our investment when the market is overvalued and then buy back in when it crashes. I think this is very difficult to execute successfully. Miss one cycle and you may need to wait out many years or miss out completely because narratives are changing every single day.

Each major market correction can offer opportunity to greatly magnify our portfolio performance. Many fails to realise that a lower price, in fact, reduces and not increases the risk.

The importance of a war chest

Keeping a sizeable warchest is important. A war chest of 5% in cash will not have that much impact. But keeping too much cash (50%), will mean you are only enjoying half of the earning growth of your investment during the in-between years. I personally think a good ratio will be in the 10%-20%.

Lastly, we have to be mentally prepared. Just imagine that your portfolio is cut by 40-50%, what is the impact to you financially, do you still have other incomes to cover the expenses? I always ask myself that if my portfolio is reduced by half, will my life be any different and will I panic. Stress test our financials to such scenario will help to prepare our mindset when it happens.

Because it will happen, the only question is when. (Already happened multiple times this year if you are in crypto)

As 2024 comes to an end, I wish each and everyone all the best in your journey towards financial freedom, good health and peaceful family ties and of course, happy new year in advance! To those who read all the way till the end, I sincerely thank you for the bottom of my heart for the unwavering support thus far.