Meet the Team: Interview with CoinLoan’s Digital Currency Analyst Max Shilo

We are excited to present the second installment of our Meet the Team series. This week, we have spoken with Max Shilo, another major contributor to CoinLoan’s success. Max is our Digital Currency Analyst based in Estonia. In this interview, he shares his perspective on the crypto market’s past, present, and future, profitable assets, and blockchain technologies.

Can you tell us about your first experience with crypto?

I haven’t always been a crypto analyst — I started off with Forex trading. A couple of years later, I got involved in the crypto boom at its peak when there were massive bull runs. Tron and Verge were the first coins I bought relatively at the top.

In hindsight, I merely jumped on the hype train. The trend was already exhausted, the prices could only go down, and selling didn’t make sense for quite a while. It turned out I wasn’t a good risk manager. Since then, I have been studying the crypto markets non-stop.

— How did you develop your trading acumen?

I did everything — I had mentors, took dozens of courses, and traded live with big amounts of money in FX markets. I started without formal education in trading and investing (I’m not sure such degrees even exist) or finance, but I’ve been studying the markets every single day for the past five years. I have a degree in marketing, but I never thought I would work in this sphere.

— So, what did you do before you became a trader?

I did all kinds of sales jobs. I started as a sales manager, then worked as a brand manager, head of strategic partnerships, and more. Since I started getting into digital currencies, though, I haven’t looked back. I realized this was something I would be doing for the rest of my life, and there was no point in trying anything else. This field has resonated with me from day one.

— How did you find yourself in the field of digital currencies analysis?

When I started with Forex, I got interested in everything connected with financial markets. I literally began studying anything that came to mind in relation to financial markets

— Why did you decide to analyze crypto instead of conventional assets — for example, commodities or stocks?

I firmly believe in new technologies, and I see that this sphere is going to be incredibly prosperous. It is coming up as a new internet or Web3. When the internet started, people didn’t understand what it was, and even writing an email was a bit of a hassle. I think it is the same with crypto, so I want to be in early and understand what this industry is about, how it works, and what kind of value it can provide.

This general interest is why I became a crypto analyst. Of course, I also research and analyze other assets like stocks and commodities, and I still trade currencies, but in a more automated way. My primary motivation is the belief that crypto is going to continue its glorious run to the upside in the near future. The trend is going up, and I want to be on it from the very beginning.

— What brought you to CoinLoan?

It happened by sheer luck. One year ago, I decided to research crypto companies in Estonia as I was curious to know how many there were. CoinLoan happened to be one of the first names on the list. I studied their website, and job openings caught my eye. Back then, I was essentially a full-time trader, and I wasn’t job hunting.

Still, I gave it a go as I was fascinated by the crypto industry, and CoinLoan had quite a few analytics-related vacancies. I emailed my CV, got a call in a few days, and after tests I got hired as a Digital Currency Analyst. That’s my story.

— What does your job involve?

In general, I help the company to deal with risk management processes.
I collect data and insights about the crypto market. I mainly deal with in-depth market analysis - the sentiment, trends, tools, and much more...
I analyze the crypto market as a whole and based on my knowledge I provide risk management insights and share my findings with the CEO. I also research and analyze different software to find products that could benefit our company in the long run.

— Let’s turn to market trends. Some experts believe Bitcoin will eventually replace gold, turning into a safe haven asset and global collateral. Is this view realistic, and why?

There are many factors at play. First, it depends on who you ask. Old-school investors like Warren Buffett called crypto rat poison, something they would never ever touch. The answer depends on the point of view, and there is no right or wrong in financial markets.

Personally, I do believe Bitcoin can compete with gold as a safe haven asset. It has definitely earned this status and already become global collateral due to massive inflation. In the last couple of years, we have literally printed around 40% of the whole monetary value. This is extremely dangerous — it is something no person or government with a healthy functioning brain would do. Yet, it has happened, so there must be some alternative or an escape.

Bitcoin does seem to be the safest option. Compared to gold, it is non-physical — you literally own something in a cloud or blockchain. You cannot see it, but can you look inside the internet? It is the same with websites — they are intangible, yet you can own them.

As a new, fully decentralized technology, Bitcoin is what humanity has longed for. Unlike anything created by governments, it cannot be controlled or manipulated. There is no pigeonholing. With Bitcoin, the world can finally achieve equality.

Over the past year, Bitcoin dominance has shrunk from 70% to around 40%. How do you interpret this change?

In crypto, money is cyclically distributed over asset classes. Since Bitcoin is the safest asset, it is exactly where big money wants to be. Usually, when someone buys crypto, they start with Bitcoin and then redistribute the funds to other coins, which are now plentiful.

This logic affects Bitcoin dominance, and I expect it to shrink even further. More money is redirected as the market evolves, and every asset wants a slice of it. Currently, Bitcoin is the leader, but other cryptocurrencies will continue to erode its dominance.

Over 18,000 cryptocurrencies are now in circulation. What, in your opinion, should users consider when choosing assets to buy?

In my experience, the first thing to consider is the team. After researching the team and their experience, I would study their Twitter and other social media accounts. A lack of activity means no community, so the asset is probably not worth your time and money. All projects with a big market cap have established themselves and developed viable use cases.

To me, a market cap of over $500 million is the main criterion. Such figures do not come out of the blue. They reflect the trust of many people, and trust is key. In the crypto industry, it doesn’t come easy. .

— Which crypto assets and technologies do you expect to dominate in 2022?

I would say Web3 is going to be a massive industry in the near future. The trend to the upside has already started, yet many people do not understand it. With time, more and more real-life applications will be built and more people will find Web3 valuable.

Secondly, it is gaming. This industry is twice as big as the music and film industries combined. Its scope is hard to fathom.

This shows how big the market is, how many opportunities it offers, and how it welcomes all kinds of new features and possibilities. Blockchain for gaming, the way you can own something inside a game that no one can take away from you, is remarkable. It is also impressive that you will be able to transfer your artifacts to other games as well.

Ads for crypto trading bots promise easy profits. How reliable are these algorithms?

I don’t think crypto trading is easy. Nor do I believe that genuinely successful bots are available to the public. Every big fund wants its algorithm to be unique, so why give it away for a monthly subscription? This does not mean reliable bots do not exist, but they will all burn in extreme market conditions in the long run. Everything you have earned in, say, half a year of consistently making money can vanish in one day when the market changes.

What are the key prerequisites for a successful investing strategy?

Risk management is the principal aspect of any investment strategy. The risk/reward ratio is super important. You need to buy crypto as far as possible from the all-time highs, rather than somewhere in between or in the middle. Although there are millions of different strategies, the risk/reward ratio and risk per trade are the prerequisites. Everything else is totally customizable and can vary a lot.

Lately, Forex brokers have embraced crypto derivatives like Bitcoin CFDs (contracts for difference). How do these instruments compare to direct trading?

The main difference is leverage. CFD trading delivers more liquidity to the market via leverage. Other than that, these instruments are essentially the same. You can trade with 100 times less capital using leverage.

This makes trading CFDs riskier but also more rewarding. I personally welcome these market instruments. First, they bring additional liquidity. Secondly, traders can create more strategies using leverage.

What are the most common trading mistakes?

Overleveraging and revenge trading. Most mistakes stem from psychological pressure in tough situations — for example, in a drawdown. Maybe you have just taken a loss, or whatever you projected onto the market didn’t pan out. Perhaps you thought, “now is a perfect time to enter,” but the market moved against you.

Psychology causes 90% of mistakes, so I would suggest keeping your head on straight and exploring how your mind works. Risk management is also crucial. Don’t take excessive risks on a single trade or act like the market is going to disappear tomorrow or surge just because you want it to — it doesn’t work like that.

— What do you mean by excessive risks? In Forex, traders are advised to risk around 1% of capital per trade. Is it the same with crypto?

In crypto, it depends. For spots without leverage, I would suggest risking a maximum of 5% per trading idea, depending on the capital.

Can you name some specific tools, technologies, or algorithms that might be helpful for a person who wants to start earning?

First, you need the charts, and here I would recommend TradingView, which is the most advanced trading platform. Secondly, I would literally read about every single project from the top 100 by market cap. Try to understand what it is, what it does, and what it can potentially become.

All necessary information can be found in simple sources like CoinMarketCap. Explore the technicals, which are the charts, and the fundamentals, which are the news and understanding.

— What advice would you give to a beginner exploring investing in crypto on CoinLoan?

It all comes down to risk management. Never risk more than you can afford to lose. Follow your intuition, and remember that the market will always be there. The most important things for success are patience and the ability to accept that you can lose.