# Web3 Principles: A Survival Guide for the Blockchain World

> **Navigating the Web3 ocean requires a reliable set of principles as your compass. These are the core principles I have distilled from personal experience, and I hope they help you navigate this emerging world safely and successfully.**

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> Recommended exchange for buying BTC / ETH / USDT: [Binance](https://www.binance.com/en) [Registration Link](https://www.bsmkweb.cc/register?ref=39797374)

## Preface: Why Principles Matter

In the Web3 world, following some fundamental principles is crucial. Just as Ray Dalio wrote his *Principles* and CZ wrote his, I would like to share my guiding principles for the Web3 space.

These principles are not absolute rules but rather my personal understanding and reflections. There is no absolute right or wrong, they are simply shared experiences. I hope they provide some practical guidance for Web3 newcomers to avoid common pitfalls in this world full of opportunity and risk.

## Investment Principles: Stability and Long-Term Thinking

### 1. Adopt a Bitcoin-Denominated Mindset

| Principle | Explanation | Practical Advice |
|:---------:|:-----------:|:----------------:|
| **BTC-Denominated Valuation** | Use Bitcoin as your base investment currency | When evaluating other assets, consider their value relative to BTC |
| **Keep Your BTC Stack Intact** | Ensure your portfolio's Bitcoin value remains stable or grows | Regularly backtest your portfolio's BTC value, not just its fiat price |

> 'In the crypto world, fiat numbers can deceive you, but Bitcoin-denominated accounting never lies.'

### 2. Asset Allocation: Stability First

| Proportion | Recommendation | Rationale |
|:----------:|:--------------:|:---------:|
| **80%+ Bitcoin** | Allocate the majority of assets to BTC | Ensures long-term value storage, avoids missing core upside |
| **Under 20% Other Assets** | Small positions in quality projects | Captures potential high returns with controlled risk |

Portfolio = 80%+ Bitcoin (long-term core) + <20% Select Projects (limited risk)

### 3. Stay Away from Leverage and Excessive Risk

- **No on-exchange leveraged trading**
- **Avoid chained staking-borrowing operations**
- **Do not speculate with perpetual contracts**

> 'In extremely volatile markets, leverage is a wealth destroyer. A single liquidation can wipe out years of accumulation.'

### 4. Capital Management Firewall

| Capital Type | Investment Ratio | Notes |
|:------------:|:----------------:|:-----:|
| Discretionary Funds | Up to 30% | Early-stage investment limit |
| Dedicated Investment Capital | 30% - 70% | Gradually increase with experience |

**Core Principle**: Only invest money that will not affect your quality of life. Ensure you can maintain a normal life even in extreme market conditions.

## Security Principles: Asset Protection

### 5. Private Key Self-Custody Above All

| Asset Scale | Recommended Strategy | Avoid |
|:-----------:|:--------------------:|:-----:|
| Small amounts | Trusted hot wallets | Do not use suspicious new wallets |
| Medium amounts | Mainstream hardware wallets | Do not store long-term on centralized exchanges |
| Large amounts | Multi-sig + cold storage | Avoid single points of failure |

**Proper Backups**: Create 1-3 independent private key backups, store them in different secure locations, and consider using metal media for fire and water resistance.

### 6. Minimize Trust Model

Basic survival rules of the Web3 world:

- **Do not trust any Web3 project or individual by default**
- **Do not trust any institution by default, including major exchanges**
- **Do not trust any code audit results by default**
- **Do not trust any guru recommendations by default**

> 'In the Web3 world, trust must be earned through time and transparency, not reputation and marketing.'

## Mindset Principles: Emotional Management

### 7. Inner Peace Over External Volatility

| Emotional Trap | Coping Strategy | Practical Advice |
|:--------------:|:---------------:|:----------------:|
| FOMO (Fear of Missing Out) | Set clear entry criteria | Write down your investment thesis in advance; do not change your standards because prices go up |
| FUD (Fear, Uncertainty, Doubt) | Focus on long-term fundamentals | Temporarily step away from price charts and social media |
| Speculative Mania | Strict position management | Set automatic take-profit levels |

### 8. Think in Time Horizons

| Time Frame | Importance | Practical Advice |
|:----------:|:----------:|:----------------:|
| Daily/Weekly Fluctuations | Almost irrelevant | Reduce check frequency |
| Monthly Trends | Somewhat useful | Make monthly rather than daily adjustments |
| Annual Cycles | Moderately important | Develop annual plans |
| 4-Year Bitcoin Cycles | Extremely important | Align strategy with the cycle |
| 10-Year Technology Evolution | Fundamentally important | Focus on long-term tech trends |

## Learning Principles: Continuous Growth

### 9. Diversified Knowledge Structure

Becoming an excellent Web3 participant requires interdisciplinary knowledge:

| Knowledge Area | Importance | Learning Advice |
|:--------------:|:----------:|:---------------:|
| Cryptography Basics | ★★★★☆ | Understand core concepts and applications |
| Economics Principles | ★★★★★ | Focus especially on monetary theory and game theory |
| Distributed Systems | ★★★★☆ | Understand consensus mechanisms and scalability challenges |
| History & Philosophy | ★★★☆☆ | Study monetary history and libertarian thought |
| Programming Basics | ★★★★☆ | Master at least one mainstream language |

### 10. Learning by Doing

| Practice Activity | Advice | Benefit |
|:-----------------:|:------:|:-------:|
| Using DApps | Start with small amounts | Real understanding of products and risks |
| Joining DAOs | Join and contribute to communities | Understand governance mechanisms and incentive design |
| Small-Scale Development | Build simple projects | Deep understanding of technical architecture |

> 'In Web3, bystanders can never gain the insights of participants.'

## Community Principles: Growing Together

### 11. Value Contribution First

| Action | Recommendation | Avoid |
|:------:|:--------------:|:-----:|
| Sharing Knowledge | Publicly share valuable insights | Do not hoard core information for personal gain |
| Reporting Issues | Provide constructive improvement suggestions | Avoid pointless criticism |
| Writing Code | Contribute to open-source projects | Avoid being a pure taker without contributing |

### 12. Cultivate Long-Term Thinking

Web3 is not a short-term gold rush but a long-term technological revolution:

- **Focus on projects that solve real problems**
- **Value community health over short-term price**
- **Participate in ecosystems with long-term vision**

> 'Short-term speculators watch prices; long-term builders watch value. Over a long enough time horizon, value is ultimately reflected in price.'

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