Scott Melker, better known as The Wolf of All Streets, is a trader and crypto advocate who is far more approachable than his online handle might suggest. A former DJ, Melker operates a small crypto advocacy empire spanning YouTube videos, podcasts and a popular newsletter.<\/b><\/p>\n
Scott Melker is open about his initial intentions in the crypto industry. \u201cI simply came to trade and make money,\u201d he admits, getting involved after hearing friends go on about the gold-paved streets of the blockchain world where 100x weekly returns were common. Being familiar with the more conservative movements of the stock markets since childhood, Melker was lucky to learn proper trading before entering the unregulated crypto casino.<\/span><\/p>\n \u201cXRP was like a penny or something then,\u201d he recalls. Crypto was also popular in the DJ community, something Melker attributes to the community\u2019s risk-taking nature. He attributes his success to lucky timing in early 2016, soon cashing out his initial investment to play with his winnings.<\/span><\/p>\n \u201cThere was this sort of groundswell in the DJ community. They understand technology, and they\u2019re kind of wild and speculative. That\u2019s how I first discovered it.\u201d<\/span><\/p>\n<\/blockquote>\n The crypto beats stopped soon enough. The 2018 bear market meant that \u201cIf you wanted to stick around, you really had to justify it to yourself, and you probably went way further down the rabbit hole to understand the importance of the movement,\u201d Melker explains. He began to truly appreciate Bitcoin\u2019s fundamentals and \u201cunderstand the purpose of individual altcoins.\u201d<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/span><\/p>\n \u00a0<\/p>\n Though Melker has invested in hundreds of tokens over the years, he believes that \u201cBitcoin is the most important asset ever created\u201d and that everyone should strive to have some exposure to it. Ether rises nearly to Bitcoin\u2019s level of importance and may well have more upside, he says, while altcoins are akin to individual speculative technology investments.<\/span><\/p>\n Soon after changing his Twitter tune from music to crypto in 2017, Melker connected with <\/span>Christopher Inks<\/span> of TexasWest Capital, who became a mentor to him. Melker became something of an analyst for Inks\u2019 fund, sharing charts and trading ideas. He clarifies that he did not trade anyone else\u2019s money, and lacks licenses to do so.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n The Wolf emphasizes that trading is not easy, whether in stocks or crypto. \u201cTo trade full time for decades, you are like a unicorn,\u201d he explains, adding that the crypto markets are especially brutal because they operate 24\/7, without pause, meaning that traders don\u2019t have an opportunity to recharge while markets are closed. Of course, you don\u2019t need<\/em> to trade all the time \u2014 Melker himself uses leverage to trade Bitcoin only two or three times per year.<\/span><\/p>\n A curious aspect of trading is that as one\u2019s portfolio grows, so do the sizes of bets one should make to remain profitable \u2014 doing otherwise would be akin to taking out $10,000 in casino chips only to spend all evening making $1 bets.<\/span><\/p>\n \u201cWhen your portfolio reaches a certain size, you have to be willing to ratchet up the size of your trades as a percentage \u2014 and those numbers can start to become uncomfortably big.\u201d\u00a0<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Melker is quick to point out that the odds are stacked against day traders. \u201c95% of traders fail \u2014 they go bust quickly,\u201d Melker states, explaining that those aspiring to be serious traders need to be prepared to lose their invested assets several times over. \u201cMost don\u2019t have the time or capital for that,\u201d he says. In 2012, Melker invested his entire portfolio into ARYx Therapeutics, which went to zero. Despite such setbacks, Melker counts himself lucky for \u201clearning the hard lessons before crypto.\u201d He finds that most who first discover trading via cryptocurrency tend to lose everything to leverage.<\/span><\/p>\n \u201cYou have to be able to learn on the job and go broke multiple times and still stick with it.\u201d<\/span><\/p>\n Though \u201cInvestors almost always do better than traders,\u201d Melker strongly recommends those determined to trade study up on risk management. Long-term profitability, he explains, is not about selling tops and buying bottoms but rather \u201cthe way that you protect your capital and allow yourself to hit home runs.\u201d He uses the example that a trader can be right less than half the time and remain wildly profitable if they know when to cut their losses. Even one win out of 10 can be a recipe for success.<\/span><\/p>\n \u201cIt\u2019s a math game of taking small losses and big wins.\u201d<\/span><\/p>\n<\/blockquote>\n Another piece of advice is to never risk more than 1% of one\u2019s portfolio on a single trade. However, this is far from foolproof. For example, 30% of a portfolio could be spread over 30 altcoin positions, all of which suffer when Bitcoin takes an unexpected dive. Ego is the enemy, and emotional attachment to positions is to be avoided \u2014 something that may be even harder when it comes to NFTs.\u00a0<\/span><\/p>\n \u201cTo stay profitable long term is largely a result of your risk management strategy,\u201d Melker claims.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Melker, 45, grew up in Gainesville, Florida, where his parents \u201chammered home the importance of financial literacy and investing and saving.\u201d He began to experiment with the stock market at 13 when he bought stocks in Disney with his father\u2019s help. He headed for the University of Pennsylvania in 1995, where he majored in a<\/span>nthropology. The school was very business-focused, Melker explains, with consulting and investment banking firms recruiting a large number of graduating students. The late \u201990s, of course, coincided with the dot-com boom, and \u201cIt was impossible to avoid excitement around financial markets at school like that,\u201d Melker recounts. He adds that there was an \u201cup only\u201d sentiment that is familiar in crypto circles.<\/span><\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n Apparently I once had a goatee. This was 2007. Steve Aoki took this photo. At the time, he was transitioning from being open format DJ Kid Millionaire to his present EDM identity. The first song he played that night was Sexyback. #TBT<\/a> pic.twitter.com\/9bN4n5bHbq<\/a><\/p>\n\n
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Trading<\/h4>\n
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Learning to fail<\/h4>\n
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DJ Bitcoin<\/h4>\n
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