Understanding how to make good decisions when betting on Crypo Multi HODL bets

Multi HODL is an innovative tool to bet on price changes on Crypto assets invented by YouHodler.com . YouHodler is a Swiss based company that is innovating in the field of Crypto financials.
I enjoyed a lot using Multi HODL but I was not well informed when I started with it and I make a lot silly mistakes, hence I decided to write this blog post with my advice, to help potential users have a fresh start. Now let’s take a look at the chart below with the 2 main Crypto assets in 2020. The fact is that since Covid started, Crypto values sinked abruptly, and after that they grown with an unusual force until being on the maximum tops cornering the end of 2020. This is how an Ethereum vs. Bitcoin looks like in 2020.

ETH vs Bitcoin price in 2020 – TradingView.com

Looking at both charts, ETH on the top although the king on the price is Bitcoin, there is something obvious: The grow direction with some temporary drop prices it’s always going UP.
It’s good to follow Bitcoin and Ether, or the coin you follow, together. As Gold is the king of the metals value, so it’s Bitcoin in the Cryptocurrency world, so if you open BTC and ETH in two horizontal panels you will see they mostly correlate over time. Usually, but not always!
So it’s essential to follow both to have a clear tendency indicator.
Multi Hodl let’s you bet on price changes in both directions, Up or down changes:

Going UP is always better than down

This are my personal recommendations about using it to avoid falling in common mistakes.

You should only reserve for this kind of bets as small percentage of your assets while leaving the rest in YouHodler savings account so it generates a steady 4.5% year interest on Crypto and 12% in Stablecoins. And the best is to not play with your Crypto assets directly, but to bet with a Stablecoin, like EURs or USDT. That way you can have more control of the gains and looses without altering your precious holdings in Crypto.

Disclaimer: This are only my views and recommendations on how to bet on UP Multi HODL Bets, with the least risk as possible and without falling in very common traps. I’m not an financial expert and this are hints that I summed up after my own mistakes.

Be aware of momentum of the year and special days. For example if you are close to black friday, check how it was historically on that day. Avoid days where you don’t see market volume, avoid special dates like Black fridays and any other internet related thing since this Crypto is attached to the internet somehow. And this special days can be specially tricky!!!’
Do a search, research the field, before planting a seed. If you are not going to take the time to do this research it’s better not to bet.

This easy tips are only based in the last price movements from Ethereum which may be very different from those of other cryptocurrencies. ETH price was hectic in the last weeks and it’s recommended to bet only UP when you see a clear grow pattern.

1. For starters: Use only the UP button and a low Risk factor (X2 or X3).

Background: Even if you make a bad decision, you can always wait, and at some moment it will go up. The price per hour is calculated using the initial Bet and your Risk factor. If you use take a big risk is not optimal to wait long hours.

Checking last months on ETH or BTC it’s going up. It’s a no brainier!
Unless you know what you are doing and you know that there is a big price drop you may try the DOWN button. But it must be a fast action, and if you loose the timing, is very probable that it will never go down again. Avoid the DOWN button. Be wise, make only UP bets in crypto!

2. The starting point is essential! The best to start an UP bet will be at the lowest point possible on a trend that looks going upwards. Look macro movements, not mini like just 2 hours range!

Explore last 5 days, even last 2 weeks, and double check that your prediction matches. Starting your race in a good point gives you the leverage to wait in a comfortable position in case there is a temporary descending path.

3. Micro betting examples: To start playing with it and avoid big looses is a very good idea to try a micro-bet. Just use a low value like 0.05 ETH or even less, like 10/20€ for example of a stable coin. Doing that you can also afford to have a bigger risk factor since the bet is small and in the worst case there is not much to loose. This way you can learn the first days/weeks till you get a feeling for it without loosing part of your assets.

4. Clearly identify grow direction: Check the Macro movements on last 5 days, last month. Usually it’s always UP but is important to detect that after days of continuous grow there is usually a DOWN cascade. So don’t trust the always UP game. The key to make a good Bet is to hold it from a low point, so you have leverage to stop the Multi HODL, at the beginning of that cascade and not at the end. Also is a good tip to see the top of the saw mountains, if the peaks go UP, it’s a GROW pattern . If they go DOWN is a DECREASING pattern. Sounds easy but it’s not always straight-forward to see.

5. Don’t double bet at the beginning: It’s very tempting to make a second bet to cover the looses of the first one (Ex. I though was going, but is going down, let’s make an additional DOWN bet!). Although can be a good idea, unless you master points 1 to 4, this is not recommended, and as mentioned before DOWN bets are a bad idea that have to be done precisely.

What it may be a good idea, is to make a “seed Bet” of a minimal import like 0.04 ETH for example, to see your idea was good before making a bigger bet, then you can close them at different times knowing that with the small one there is a minimal risk. Both going UP!

6. Mind the GAP: From the starting point, let’s imagine the scenario where you start an UP Multi HODL bet of 0.7 Ether when ETH price is 590 u$. Mind the origination fee of 0.45% cost that you can see in Details plus the hourly fee, that can be high if you choose a high risk factor (X).

Example: 0.7 ETH Multi HODL bet at X7 factor taking in account the costs, will start generating something only above the 595 u$. So this 5% (about 0.5% UP) is only to cover the costs. So make the appropriate markings in your favorite Stock Chart online viewer, in order to visualize this risk, and to get away at the proper time in case goes down abruptly. Using lower risk factors like X2/X3 makes the initial cost lower and has also the advantage that if you start in the wrong point, you can wait till the new upward Wave in order to avoid stopping the Bet on RED numbers. Theoretically, unless the exceptions when the starting point is not wisely chosen or the bad luck to start when a DOWN cascade is flowing, you should only quit an UP bet when it’s on the winning side and not before.

7. Mind the Growing vs. Decreasing speed: Usually it’s quite normal that the grow movements are like a chain Saw of short upward movements with down cascades every now and then. If the cascades are short and do not cut all the grow is great since it’s a clear signal that there is increasing GROW.
But it’s not uncommon that after a long upward Saw shape comes a BIG cascade DOWN. And that’s sometimes really fast down compared to the grow speed, be ready for it, and away from your danger top bottom line (Where you start loosing)

It’s very important not to freak out in this point and stop the Bet in the most down part of the cascade. This is a very common error that stopped many of my good bets. Get accostumed to this movements, make your margins visible drawing over the live stock Chart and HOLD it unless you see clear signs of a catastrophe!

8. Don’t overuse it and do not get addicted to it: Making one or two good Bets you can call this a day and just walk away happy till next day. The luck to be always in the growing side is not take for granted. Many times you may not see a DOWN cascade of death coming, and in one fail, loose the gains of many good guesses. Use this consciously, you are playing with real money here. And start slowly, making Micro bets as described in point 3, to get the feeling and timing for it. Keep in mind doing this is time consuming and may make you tired!!! Find the good moment to start it.
This is the key for a very good Bet!

9. Be aware of context on the Crypto you are making the bet. For example if you are betting on Ethereum, then follow the ETH developers and related channels. Starting this month they are launching ETH2 and I bet that had an effect on the super bullish unusual grow on the last few days.

10. If possible don’t use your Crypto on this! Your mission is to HOLD your Crypto and have an stable financial future. So playing with it’s a bad mix. Unless you are sitting on a stronghold of Ether or Bitcoin and you are wise enough to keep your balances right I strongly recommend to use any Stablecoin that you can afford to loose to do this kind of bets.
Do not forget: You are playing with real money when you start a Multi HODL, and even that it looks like always going up on a Macro zoomed out view, the reality is that is not always a constant growth. And in a single day can be a 10% drop on the price, if you are there on one of this UP bets, you will loose at least 1/3 of what you bet if you don’t get out in the right time.
So I will say it again in case it was not clear:
Separate your betting risk money from your Crypto assets if you want to be in the safe side!

11. Last but not least, do not play with Bottom margins. Let it breathe!
It’s very human to think: I will just control my risk setting a very low margin so I can sleep in peace!
There is two problems with this approach:
1. As described in point 6 there is a gap from the Bet start till you start winning so setting a very short down limit can let you out with the worst scenario. I will describe this with an image after declaring my intentions. Also mind that the margin stop loss has a high cost!
In case of margin call or stop loss you will be charged a 2% service fee instead of origination and hourly fees. In the App/Website says 3.8% fee but is wrong (Already reported this)
This 2% is taken from the total amount depending on your risk factor so it’s much better to stop it by hand if you want to do so. This limit is just a safety ring to avoid loosing absolutely everything. But it’s not recommended to use it unless there is a good reason to do so and always tight to your starting point!!!
Failing to do so and having a bad starting point is a guaranteed way to loose the bet. To have a real scenario, let’s say the total borrowed money for the bet is 2000 u$, margin call with take 2% of that so you will end up paying 40 u$ just for the automatic margin call. Don’t do this.
If you don’t find time to be relaxed and follow your bet is better not to start it. This is the wisest advice I can give to you after gaining some experience.

2. Is very normal that you think is the best start point and it’s not. You cannot control the snake and cannot possible predict the future. So just let it breathe and at some point it will grow. And if it does not and hope is lost then at least wait enough time to get at the highest point and stop the bet manually.

Anatomy of a Bad bet and a very bad decision: To set a low margin call, see it was just about to wait longer!

This is fun but also risky and time consuming. And it’s also something that can be done in a wild, hectic coin like ETH, but also on more stable ones and doing it with more calm waters can be the key to success in this crazy oceans of 2020.
I highly recommend to do this confortably from a Desktop computer since the UX is much nicer defined and is more precise. I had two times problems when starting this from the iPad since the rist leverage is close to the UP button and withouth intention you can start with the Highest risk. The mobile App is good to stop the bet, but to be on the safe side, start it confortably from your laptop.

Managing risk

As mentioned before this takes risks of loosing real money. And it’s supposed to be done with assets you can afford to loose. If you don’t like risk at all then you don’t have to do it. You can just leave your Ether, Bitcoin, Litecoin or many other coins just there and use it as your wallet, generating 4.5% yearly interest.
Or 12 % in stable coins. I have some EURs assets that is 1 coin, 1 euro and this generates a nice passive income that you use as a end of the year savings or any time when you want to invest in buying more Crypto.
This is are only my personal views and I’m not a financial expert. I’m just a worker that is tired to be in the office 9 hours / 5 days a week and is looking for financial freedom.

Related articles

Keeping your Crypto assets to generate 4.5% (ETH, BTC) to 12% (stablecoin) yearly interest

As an addition to latest article “Financing a web-project with Ethereum” I wanted to show how to make your Crypto assets grow a small percentage per year and also to have some additional cash per month using Stablecoins.

Stablecoins are cryptocurrencies designed to minimize volatility, relative to some “stable” asset or basket of assets. For example there is EURS that is tied to the € price also 1 EURS = 1 €.
Another one is PAX Gold that is tied to the price of one ounce of Gold. Both of this stablecoins are a subset of Ethereum network. With PAX Gold you can if you go to London, exchange your coins, for real gold. That’s what they claim at least since I would not fly there to prove it. More than that, the point I want to make here, is that in sites like YouHodler you can make 12% APR + compounding interest per year.
Let’s say you have 10.000 € there for one year untouched.
At the end of the year you should have 11.200 € with a 12% interest.
If you want you could extract this 1200 € to your account and have some extra cash at the end of the year for further investments of a short holidays. That is a quite interesting method to generate a passive income over the years.
Below there is a talk about stablecoins that was recorded and had 464 registered participants from 58 different countries, on April 17 2020

Now the only risk I see is that this money is not on your domains. It’s hosted in a secure wallet in the domains of a company. So what I recommend, no matter what site you choose, is to check very well and read about who is behind the company and how secured are your assets in the event something happens with the company you choose.
I use to trust the banks a lot until one day at the middle of 2001 in my hometown, Buenos Aires, the economy crashed and the banks simply will not let you take your dollars out of your acccount. Or even worse, they where converted to argentinian money, something that at that moment was the equivalent to flush your cash into the toilet.
Ater that happened to me, got an offer to work in Spain and moved to the EU in 2004, and I always take care of where I put my assets and making an analysis of the risks. Of course we are in Europe and here the protection laws, would simply not allow a bank run like that to take place, still with that assumptions it is wise to check where you put your money.

Team of YouHodler

In case of YouHodler my analysis was good and as I mentioned in last post, the fact that they are a members of the BlockChain Association and the Financial Commission, and that they open profiles show an extensive and proved career in the Financial tech industry was enough for me. The fact that they have real offices in Malta but also in Switzerland is also a proof that they real and solid.

Disclaimer about 100% transparency: I’ve decided to sponsor YouHodler and will also make some videos and further analysis openly. The links starting with track.youhodler.com are affiliate links since I want to get additional cash in order to film the videos and use my time to share with my readers the road to financial freedom and to generate an additional income each year.
‘This links won’t work from Germany or from Spain due to country restrictions. But from those countries you can enter directly to youHodler.com
This does not mean that I blindly recommend this company. There are also others in the market like Nexo that offer a similar percentage (2% less on stablecoin). Feel free to explore and take your decision solely on your assumptions.

You can also earn crypto faster with Multi HODL but that is something that must be handled with care and deserves a new Blog post. For the moment I only recommend to keeping combined assets, like for example some Bitcoin and Ethereum, along with Stablecoins like EURS or PAX Gold in order to generate a passive income.
Do not try Multi HODL with the dream of making a fast buck. It’s very risky to use it, specially with the variations value of cryptocurrency, that is like trying to take control of a wild snake. This must be used with care and meditation.

Questions for my subscribers:
What do you think about this?
Would you trust an external company part of your assets provided they are trustable and generate a yearly passive income?

I bough some ETH back when it was 260 -> 280€ now it has gone up almost 100€ in two months. That was a lucky desicion. But is not always like this and it can be that due to market changes, external factors, or just the team Ethereum development roadmap that it simple goes down too.
This was a good analysis made by an user of TradingView months ago:

This second analysis was also quite accurate. 1 ETH is worth today 19 Nov. 2020 about 470 dollars (395 €).