Examining from the Daoist concept of Yin and Yang: The Yin-Yang balance technique of Crypto Assets.

Author: hitesh.eth, encryption KOL

Compiled by: Felix, PANews

Yin and Yang is a concept in Chinese philosophy. It refers to the perfect balance between two forces that are interconnected yet opposing. In the field of encryption currency, this force is everywhere — chaos and order, risk and stability, greed and patience. Understanding how they interact is the key to navigating the market.

This article will explore how to apply the concept of yin and yang to cryptocurrency, first outlining the yin and yang forces in the encryption field, and then exploring how to balance them to achieve better outcomes in trading and investing.

Yin

Yin represents the darker, impulsive, and chaotic forces in the world of encryption.

You cannot escape them. Even if you try to avoid them, they are deeply embedded in the essence of cryptocurrency. The allure of irrational behavior, speculation, and shortcuts is haunting. If you completely reject it, you may avoid losses, but you will also miss out on the massive profits that initially attracted you to the field of encryption.

The key is not to avoid the shadow, but to learn to coexist with it—without letting it influence your decisions.

Degeneracy (gambling nature)

Degeneracy is the most seductive shadow.

During a bull market, the Degen (gambler) mentality prevails. The air is filled with FOMO, the timeline is full of victories, and everyone seems to have made ten times their investment overnight. Logic becomes a faint whisper, while hype becomes a deafening roar. Degens blindly follow the crowd to buy tokens, often without reading the white paper or even understanding the tokens.

Why? Because Degen gives people a sense of freedom. It makes them feel liberated from rules, systems, and research. Clicking buy means participating in the act of rebellion.

But this stimulation comes at a cost. Acting on emotion in a highly stimulating environment causes your brain to chase the pleasure of dopamine rather than sustainable gains. Over time, you will become addicted to impulsive trading. The end result of this cycle is not wealth, but liquidation and exhaustion.

However, there is a paradox here: if you never act like a Degen, you might miss life-changing opportunities. Some of the fastest tenfold or fiftyfold opportunities often come from reckless bets. This is why degeneracy should not be eliminated—rather, it should be tamed.

KOL

Key opinion leaders (KOL) dominate the encryption field. They are a lifeline, but also a minefield.

The “yin” evil side of this is obvious: most KOLs are entertainers rather than researchers. Their goal is to attract attention, not to ensure the accuracy of information. Many token promoters pretend to know the next hot trend in order to make money, cultivating a cult-like following. They showcase a lifestyle that makes you eager to emulate, but these KOLs often abandon the audiences influenced by them behind the scenes.

Following the wrong KOL is like chasing a mirage in the desert. The farther you walk, the more you believe there is water ahead, until you collapse from thirst.

But there is a problem: you cannot completely ignore KOLs. They are the pulse of the encryption culture. They can amplify early narratives, allowing quality projects that have not yet been discovered by those tools to stand out, and pass on cutting-edge information to a broader audience.

The challenge is not to avoid KOLs, but to filter them. The best KOLs are not the loudest voices—but those who have capable and discerning followers, the quiet group. They explain rather than hype. They guide you to the forefront of the market rather than recommend a particular token. With the right filtering tools and continuous tracking, you can distinguish noise from signal.

In this way, the “evil shadow” has become a tool for discovery.

Trenches

If Degeneracy is the fuel, KOL is the signal, then Trenches are the battlefield.

Trenches are private Discord channels and Telegram chat groups, where hunters dig for early treasures in private communities. Unlike those who join later as crypto KOLs, these individuals do not flaunt their work—they focus diligently. They scrape contracts, study documents, search for little-known development teams, and map out the entire ecosystem before others even notice.

Being in the trenches gives you a rare opportunity: early exposure. When CT starts to hype a narrative, frontline players have already made five times their returns.

But being in the trenches is not foolproof. It requires time, investment, and constant vigilance. Narratives change rapidly, and holding out too long on a certain front (for example, if the market shifts to RWA or DeFi while you are still focused on AI) can damage your portfolio.

Lesson: The trenches are the cradle of alpha returns, but not the destination. Without broader awareness and background knowledge, you will be overwhelmed by weak signals.

Yang

Yang represents the clarity, structure, and order of balanced chaos.

It concerns building beliefs from research rather than emotions. It is about using data, tools, and narratives to filter out noise, validate Alpha returns, and accurately seize trading opportunities. However, just like Yin, excessive Yang can also backfire. Too much Yang can make you rigid, blind to new opportunities, and always late to the party.

The goal is not to always live in the light, but to let the light guide and stabilize the dark.

data

Data is the cornerstone of Yang.

Smart fund tracking, on-chain capital flow, wallet dynamics, open contract charts, and technical analysis indicators can provide you with an objective perspective on Alpha returns. Data does not lie, but it also does not tell you the whole truth. Most signals have lagging characteristics. By the time the data confirms a trend, early high profits have often slipped away.

This is why data should never be your starting point—it should be your filter. While Yin provides you with Alpha returns from KOLs or market trends, Yang verifies them. Data can help you answer: “Is this real or just hype?”

Technical analysis allows you to enter and exit more precisely. On-chain dashboards can reveal whether whales are truly buying the assets hyped by CT. Without this verification, you are gambling rather than trading. With it, you can take control of the probabilistic advantage.

tool

Data without tools is like gold buried underground. Tools can dig it out.

TradingView is used for technical analysis, Nansen is used for wallet analysis, Kolscan is used to track KOLs, and DEXU.AI is used for narrative heatmaps. Even AI assistants like ChatGPT or Perplexity can now perform quick technical analysis or explain token economics in simple language.

But mastering is more important than having more tools. Using ten tools in a scattered manner will only allow you to scratch the surface. Choosing one or two tools and using them every day will make you stronger. The more familiar you are with them, the more quickly you will be able to notice things that others overlook.

Tools will not replace intuition – they will sharpen it.

narrative

Narration is the intersection of yin and yang.

Every bull market is driven by narrative. The narrative is the story of why one believes a certain token, sector, or ecosystem is important. From the summer of DeFi to the NFT frenzy and then to AI coins, the impact of narrative on liquidity far exceeds the fundamentals.

But the narrative is also unpredictable. They rise rapidly, attracting capital, and then crash after the hype fades. If you react slowly, you will be trapped.

The key is to see the “spark” before the “fire spreads.” The narrative begins in small circles—Alpha groups, unknown Twitter accounts, GitHub repositories—before it erupts into mainstream narrative. The earlier you identify them, the greater the rewards.

Narrative is the compass that coordinates the order of “yang” with the chaos of “yang”.

Balance: Yin + Yang

Victory in the field of encryption is not achieved through shortcuts: neither through blind degeneracy nor through rigid analysis.

The winners are those who can master balance.

Yin gives you sparks: early gameplay, high-risk gems, narratives that no one believes. Yang provides structure: verification, timing, and order. Together they form a cycle of discovery and confirmation.

The achievement of balance can never be perfect. It is like a dance, constantly adjusting with the evolution of the market. But if you can recognize these two forces and maintain discipline in their application, you can not only survive in the field of encryption but also thrive in it.