Letter 70: Growing your Portfolio from $0 to $10m+

A guide on managing your portfolio at 5 different stages

One of the toughest things when it comes to writing in crypto is that everyone is in a different situation, and so the advice that might be best for one person is very often not the best for the next person. There’s many reasons this can be the case — how much time a person chooses to spend in the space, their risk appetite, their current level of knowledge, etc.

But probably the most relevant is a person’s portfolio value. So that’s what we’re going to be discussing today: how your strategy and approach to making money in crypto should adjust based on portfolio size.

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We’re going to break this post down into five stages:

• Stage 1: $0 to $1,000

• Stage 2: $1,000 to $10,000

• Stage 3: $10,000 to $100,000

• Stage 4: $100,000 to $1,000,000

• Stage 5: $1,000,000 to $10,000,000 (and beyond)

This is all also of course making some assumptions, the main one being that we are strictly talking about growing your crypto capital from within crypto itself, and assume you’re willing to put in some time and effort to try and “outperform the market”. It assumes you’re not making weekly or monthly fiat deposits to grow your crypto stack for whatever reason (you don’t have a job, you don’t have spare cash, whatever).

I maintain that the best strategy for most people is to work a normal job and DCA into BTC and maybe a couple of other coins and grow their wealth that way. But most people reading this don’t think they’re most people, and to be fair, if you’re reading this, you’re probably more likely than most to be taking crypto seriously and you do stand a better chance at success-within-crypto than the average Joe.

Before we get started, I want to share a clip that discusses the end goal for most people: fuck you money.

I’d also like to direct you to this fantastic twitter thread by Punk6529 where he discusses 5 levels of “making it”, with the highest level being largely unrelated to money entirely. My 5 stages will only get you to level 4 on the Punk6529 scale, and it’s worth keeping that in mind.

Anyway, let’s begin.

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Stage 1: From $0 to $1,000

When you’re starting from literal zero or have a relatively low bankroll, you have to use your time to make money — and then you want to be very careful not to lose that money (since time is so valuable).

The beauty of crypto is that you can start from literal zero. It is free to create a wallet and to receive tokens. When you have no money, or don’t have much money, airdrop farming is your friend.

You should be spending almost all of your time at this stage doing one of three things:

1. Airdrop farming

   1. Airdrops are one of the best things in crypto for those without much capital. Protocols are constantly sending out tokens to people for using their products, and lately, even for talking about them on social media via InfoFi.
      
      I wrote an entire guide on Airdrop Farming and how to approach it which I recommend reading:
      

   It’s gonna be a grind, and there are going to be lots of worthless airdrops. But this is still the best way to build your bankroll. Focus on the non-linear airdrops (the ones that don’t give out points based on TVL or volume), aka the ones that don’t really require much or any capital.
   
   You’ll probably have to grind galxe quests, say a million gms, tweet and retweet all sorts of garbage, and use infinite testnets. It’s not particular fun, and it’s not particularly stimulating. But it’s the way the game is played. Spread your wings far and wide, try and catch as many potentially airdrops as you can, and stack those $4 stimmy drops while holding out and hoping for a lucky 3 or even 4 figure drop.
   
   There’ll probably come a day when airdrop farming is no longer the best way to grow from zero, but today is not that day.
   

2. Growing your network

   1. With time on your hand and limited capital to trade, you ought to be growing your network within the space. This means making friends, peers, acquaintences. Getting into alpha groups, starting your own alpha group. Do what you have to do to bring together a group chat with a few peeps all around the same level so you can hustle and come up together.
      
      Trust me, this is invaluable. It’s invaluable at every stage, and the sooner you get started, the better.
      
      This also is a good time to start building a profile on social media. Put some time and effort into being active on Twitter and Farcaster. Hate social media? Tough titties. If you want to maximize your edge, you need to understand how to utilize it. You can delete all social media and hate on it all you want once you have fuck you money, but until then, suck it up and do what you gotta do.
      

3. Learning as much as you can

   1. The real best investment you can make is in yourself. If you’re working with a sub $1k portfolio, you’re probably pretty new to this all. Not always, but probably. That means there’s an infinite amount for you to learn (there’s always an infinite amount, but, like, there’s like infinity times a million amount when you’re first starting out).
      
      Be a sponge. Soak everything up. Google and AI are your friend. Ask every question, look up every term. Follow your curiosity. Try stuff. Knowledge compounds exponentially just like everything else, and the more you learn earlier on, the greater the base you’ll have to work from as your portfolio grows.

Any money that you make in this stage should be visciously protected. Don’t succumb to temptation and throw $20 here, $50 there, chasing a random memecoin that your friends are talking about. Yes you might get lucky, but chances are you won’t.

Honestly, try and keep your portfolio entirely in stablecoins at this stage.

Liquidity is king.

What you should do

• Farm airdrops like your life depends on it

• Grow your network

• Learn as much as you can

• Portfolio in stables

What you should be wary of

• You want to avoid following the advice most people give which is geared towards those with larger portfolios — you don’t need to worry about your allocations, your split between BTC and ETH and other tokens, etc.

• Be mindful of fees as they can really eat up your funds at this level: gas fees, bridging, slippage, currency conversion, and so on.

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Stage 2: From $1,000 to $10,000

Honestly this stage isn’t too different from the previous one, with the main difference now being that you can afford to use some capital to make more capital.

Airdrop farming should still be your bread and butter. Your portfolio should remain in stablecoins — liquidity is still king. You can open trades if you think you’ve found a good opportunity (trying stuff is great, it’s how you learn), but be aggressive with profit taking and always keep in mind that you’re trying to build your stack here to $10k.

Each failed bet is a step backwards, and with a portfolio size in this range, you can’t afford too many steps backwards.

What you should do

• Keep airdrop farming

• Portfolio remains in stables when undeployed

• Be aggressive taking profit with any trades

• Treat failures as tuition costs

What you should be wary of

• The temptation to trade here is going to be high — you feel like you have a bit of a bankroll now, some padding, and can “afford” to take some risks. While true, be very wary of how many you take and how much each risk adds up to. If they’re not paying off, stick to the airdrop farming.

• Stay mindful of fees as they can really eat up your funds at this level too

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Stage 3: From $10,000 to $100,000

I’d argue that this is the toughest category to get through. The lower stages are tough, but airdrops are lucrative, and even modest ones can increase your entire portfolio by a significant percentage when the portfolio is worth $10k or less. Once you hit Stage 3 however, most airdrops aren’t going to drastically move the needle, and so you need to expand your horizens.