Hard knocks tend to teach lessons that don't get forgotten, in investing as well as in life. But as most investors know, learning from someone else's experiences is a far better way of deriving hard-earned wisdom than going through the difficulty of stumbling over challenges yourself.

In cryptocurrency, there's one particular lesson that almost everyone learns the hard way at one point or another. If you haven't learned it just yet, do your best to do so now, before you have to pay the full price of tuition.

Investing in the "future of finance" is a risky business

Professional cryptocurrency investors typically consider themselves to be a daring lot, often believing that with their asset selection, they're investing in the "future of finance." Many of these investors opt to time their investments on the basis of Bitcoin 's (CRYPTO: BTC) halving cycle , which they believe gives the entire cryptocurrency sector a cyclical nature.

Within that framework, they tend to allocate their capital between Bitcoin, stablecoins, and altcoins. The idea here is that Bitcoin is a suitable long-term investment to be purchased when it's cheap, stablecoins are for parking profits from riskier plays, and altcoins are those risky plays which are said to generate outsize returns. Thus, while crypto portfolios tend to be quite risky in comparison to stock portfolios on average, even those who are comfortable with the somewhat speculative nature of the space prefer to have at least a measure of diversification.

By spreading their capital across stablecoins, Bitcoin, and gambles, the objective is to maximize the upside from crypto's volatility while minimizing the risk of getting entirely wiped out by the market's often extreme gyrations. For these investors, there's a clear roadmap for when to be buying coins and when to be offloading them on the basis of where Bitcoin's price is, and in relation to its halving. It thus follows that they roughly target a three- to four-year time horizon for their investments, as halvings occur approximately every four years.

The dream is to pick the altcoins that go to the moon, as those coins are the most likely to be experimenting with new concepts of money, new technologies, and other novel dimensions that make them exciting compared to older coins. The reality is that most of these coins go to zero or perform terribly. Even knowing this fact in advance, many investors believe that with their special wisdom it will be possible to succeed.

Take a look at this chart comparing the prices of Bitcoin, Ethereum , Solana , Cardano , Chainlink , Tron , and Litecoin over the last three years, as of this writing on March 14, 2025:

Keep in mind that all of these coins either were or currently are among the largest by market cap, and that they thus have the largest bases of bullish investors in the sector.

As you can see, only Tron outperformed Bitcoin. If you had selected, bought, and held all of those other assets three years ago, beyond Bitcoin and Tron, you are now either underwater, at breakeven, or at a mediocre profit. And that's the first component of the hard lesson.

There's an easier way: Just stack Sats

For most investors, even the full-time ones, the odds of outperforming a strategy of simply buying and holding Bitcoin consistently over the long term are incredibly slim. That's the second part of the hard lesson.

It doesn't matter if you think you know some special facts about the four-year halving cycle and how it is likely to impact altcoins. Those unique facts are almost certainly not enough to guide an investor toward the selection of the best emerging assets before they're proven. And once they're proven, it might be too late to invest and get a decent return anyway.

The cryptocurrency investors who have learned this lesson have a special phrase that denotes their enlightened knowledge: Stay humble and stack Sats. By that, they're referring to consistently accumulating Satoshis, the smallest possible fraction of a Bitcoin, worth 0.00000001 BTC each.

Of course, that doesn't literally mean that you should only buy Bitcoin and no other cryptocurrencies. The spirit of the phrase is an exhortation not to hungrily chase shiny new gambles when there is a proven asset (Bitcoin) that seems very likely to offer a much safer and potentially much larger return over the long run.

So, knowing this, you should try to adopt that mindset and accept the hard lesson without paying the full price for it. If you're willing to keep holding and accumulating, it'll be hard to go wrong, and you'll likely outperform greedier investors, too.

Before you buy stock in Bitcoin, consider this:

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