Lessons for Trading Bitcoin in Volatile Markets

Over the past week, we've all watched stock markets and crypto markets experience large price declines, sharp movements, and heavy trading volume. For many, volatility in the markets leads to fear and sometimes even panic. Based on my 15+ years of experience, I have come to view these periods with excitement, since outsized opportunities become available to those who stay calm while others panic. In reflecting on my own trading during extreme market movements in the past, I came up with a list of lessons that I've learned that I'd like to make available for others.

I've traded in two very distinct capacities:

1. Arbitrage and active trading. I worked for one of the largest market making / high frequency trading firms in the world for most of my career. I've traded through some of the most volatile periods across the US, Europe, and Asia.

2. Positional trading and long-term investment. I've personally traded my own book for the past 15 years and have learned a lot during that time. Much of that perspective has been shaped by my direct professional understanding of market structure and how various market participants behave.

Arbitrage and Active Trading

Positional Trading and Long-term Investment

Cove Logo Get Started