In-depth Analysis of Data-Driven Trading Strategies: A Conversation with CoinKarma Founder Benson

The founder of CoinKarma, Benson, shared in detail the evolution of his trading strategies during different cycles, as well as how to use data indicators to guide trading. Benson has consistently thought outside the consensus on how to build trading structures, thus winning in the game of contract trading, which is how to win over the majority.

1. The Evolution of Benson's Trading Strategy

1. Initial stage: Frequent chasing of highs and selling on lows leads to significant losses.

2. Realize that market fluctuations are controlled by the main players, and start thinking about how to use data to follow their operations.

3. 2019-2022: Discover that funding rates have a significant impact on trading, profiting through counter-market sentiment operations.

4. After 2022: The Federal Reserve's interest rate hikes affect the sensitivity of funding rates, rendering the original trading system ineffective.

5. Turn to studying order book data, develop the CoinKarma indicator, and look for safer trading positions.

2. Current Trading Strategy

1. Over 60% position: entrust to quantitative strategies for asset appreciation in the base currency, mainly holding and accumulating coins.

2. Approximately 40% position: mainly in stablecoins, used for participating in on-chain transactions or the first order of contracts.

3. Trading objective: Focus on stability, outperform the market index, with performance between 2-3 times since the beginning of the year.

4. Different Operation Methods for Various Underlyings:

   • Potential market hotspots: Hold until market attention or bull market ends
   • Large market cap tokens: Determine price trends through technical analysis or fundamental analysis.

3. CoinKarma Core Indicators

1. Overall LIQ(Overall Liquidity Status):

   • Principle: Depict the market liquidity condition and determine potential price reversal points.
   • Application: Find positions with higher safety margins in volatile markets.

2. CVD(Cumulative Trading Volume):

   • Principle: Observe the strength of market orders to determine whether the market is in a range or a trending condition.
   • Application: When the CVD intensity is high and the market order strength is strong, a one-sided market may be迎来.

4. Period Judgment

1. Characteristics of Market Peaks: There is a lot of external attention on this field.

2. Focus Indicators:

   • Coinbase APP download ranking
   • Wikipedia's Bitcoin page views

3. Conditions for breaking historical high points: external capital intervention is needed.

5. Investment Logic of Altcoins(Taking Solana as an Example)

1. Technical Perspective: Non-EVM compatible, high development difficulty, high application purity and developer skill level.

2. Community Value: Obtain Support from Core Developers

3. Rebirth through fire ability: maintaining a strong momentum after experiencing multiple upheavals.

4. BTC pair price performance: A few Altcoins that have not entered a long-term downtrend since the last bull market.

6. Tips to Avoid Major Losses in Trading

1. Buy tokens without buying stocks: The cryptocurrency market changes rapidly, and tool-type projects are prone to collapse when the hype fades.

2. Focus on projects that have a sense of hazy beauty and imaginative space but have not yet fully materialized.

3. Invest in projects with lasting demand that will not fluctuate significantly with the cycles.

4. Sell in a timely manner: when the expected target is reached or there is no reason to hold.

5. Control Leverage: The cryptocurrency market has large fluctuations, and high leverage can easily lead to being liquidated by the major players.

7. Methods for Continuously Perceiving Market Changes

1. Establish an understanding of the basic operations of the market

2. Consider the reflexivity of trading and think about the behavior of the majority.

3. Pay attention to the changes in the effectiveness of indicators and adjust strategies in a timely manner.

4. Understand the sources of market volatility and the logic of major player operations

5. Control the dissemination range of Alpha to maintain its effectiveness.

8. Advice for New Traders

1. Understand the sources of market fluctuations and the logic of main player operations.

2. Establish a non-consensual way of thinking

3. Continuous learning and adapting to market changes

4. Do not completely copy others' strategies, find a trading style that suits you.

5. Pay attention to the experience sharing of different traders, learn from each other's strengths.