Any financial market (and crypto is no exception) grows based on the influx of new money. However, the nature of financial markets is such that no matter how much liquidity comes in, it constantly flows out of the market, like a barrel with a leaky bottom. We are not talking about disappointed or cautious investors who withdraw their assets. This typically happens at the end of downward cycles and is referred to as “Market Capitulation.” We have observed this phenomenon many times, which is usually followed by dynamic growth, but without those who have incurred losses.
Every day, millions of deals ranging from a few dollars to several billion dollars are made in the financial markets. Some people win in these transactions, while others lose. But one thing is constant—a commission is paid for each transaction. A small, seemingly insignificant percentage is taken by a broker, stock exchange, or any platform that provides the opportunity to conduct the transaction. These small percentages, which may seem trivial individually, collectively add up to substantial flows of liquidity that exit the market and end up in the pockets of those who prefer speculation over servicing speculators.
This happens every day, almost every second. A new million dollars enter the market, and within a second, there is less of it left. During the first transaction, a portion of liquidity is skimmed from this million. And so on and so forth. People move their money to where there is continually less money. Doesn’t that seem absurd? However, the belief that markets grow in the long run partly justifies this decision, mainly because there is so much fiat money being created that diverting it elsewhere from financial markets would require more imagination and skill. So, isn’t it better to succumb to the enticing dream of getting rich and bringing your money to the stock market? But let’s be honest, few people succeed in this bet. Few have the patience, vision, and wisdom to weather downturns and invest in their long-term portfolios in a disciplined manner. This is why dreamers turn to speculation, accelerating the outflow of liquidity and filling the pockets of stock exchange owners.
Is there a way out?
As always, there are several options:
- You can refuse to play the game altogether, where you are initially treated as a fool and brought to the table only to be robbed. Not a bad option, but not the best. Holding onto cash when the printing presses are running at full capacity is a lost cause.
- Investing in over-the-counter instruments is possible, but we live in a world built by financiers and capitalists, so wherever you go, you will have to deal with finances.
- However, there is a third way. You can become the very owners of trading platforms and earn from others who trade in the hope of making a quick profit. How do you like this option? If you are interested, react to this post, and soon we will continue, and I will explain step by step how to do it.
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