Diamond Hands: Lessons from $BNB & CZ during my time at Binance Labs

Hello, Boarders!

It's YB here.

In 2018, I joined Binance as a Director at the Labs. During one of our early town halls, CZ, the CEO, dropped a knowledge bomb on us. He said

"If you think you can make more money trading crypto assets, you should quit Binance and go trade full time."

Initially, I was taken aback, but CZ explained further. He learnt from experience that buying and holding is the best way to make money from crypto. And he was right.

When I joined Binance, $BNB was just $6 a pop. Over the next three years, $BNB would soar to an all-time high of $650 – an astounding 100x increase. Even in the current bear market, $BNB remains at $333, representing a still-impressive 55x.

But here's the kicker: I didn't hold onto my $BNB for that long. Like many crypto investors, I tried to time the market, chasing after gains by trading in and out of various assets. I was confident I could outsmart the market and find the next big thing.

As it turns out, I was wrong. While I did make some gains, I didn't maximize my returns in the way I could have if I had simply held onto my $BNB. This is a common mistake that many investors make, not just in the crypto market but in all markets.

The lesson here:

Timing the market is a fool's errand, buying and holding can pay off big time, especially in the crypto market.

Of course, this isn't to say that trading is always a bad idea, but holding on can be even more rewarding in the long run. As Warren Buffet said, "If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes." If there’s anyone who knows the best way to make money as an investor it’s the Oracle of Omaha – and I now know this to be true too.

With so many options available, it can be difficult to know where to begin. Fortunately, there are some low-cost and easier ways to get reasonable returns from the crypto market that every investor should know about.

That's why I encourage everyone to consider a low-cost, long-term strategy like dollar cost averaging.

This means investing a fixed amount regularly, regardless of market conditions, when you do this, you can smooth out volatility and avoid trying to time the market. Patience is key, as is the power of compound interest. Over time, even small contributions can grow into substantial sums.

Investing always carries some degree of risk, and past performance is not a guarantee of future results. It's crucial to approach it with caution and a long-term perspective. In the end, investing is all about finding the strategy that works for you. However, if you're looking for a solid and reliable way to build wealth over time, take a cue from CZ and consider a buy and hold strategy.

It may not be as flashy as trading, but it can be a solid and reliable way to build wealth over time. And who knows? You just might find yourself holding onto the next $BNB.

Putting It All Together

So, how can you put these concepts into practice?

• Firstly, start by setting a regular investment amount and schedule that you can stick to. It could be as little as $10 per month, but the key is consistency.

• Secondly, be patient and resist the urge to make short-term trades based on market fluctuations.

• Finally, take advantage of the power of compound interest by staying invested for the long term.

In conclusion, dollar cost averaging, patience, and compound interest are powerful tools for investors seeking reasonable returns from the crypto market. By combining these concepts, you can minimize risk, maximize returns, and achieve your long-term investing goals.

Therefore, the next time you're considering timing the market or chasing after the next big thing, remember that sometimes the simplest investment strategy is the best.

While these concepts are easy to understand, putting them into practice is challenging. That's why we created Onboard, it’s more than just a financial app, we are building a membership community of modern Africans who are on their wealth-building journey and want to share, learn, and support one another. Becoming a member is easy: download the app and get onboard to take the first step in your journey.

DISCLAIMER: This newsletter is for educational purposes only and is not investment advice or a solicitation to buy or sell any assets. Please do your own research before making any investment decisions.