Gary Cardone, a seasoned finance veteran with over 40 years of experience, has sold his entire XRP portfolio, liquidating an $80,000 position. In a tweet posted on February 21, 2025, Cardone shared the six key principles behind his decision to exit the asset, giving insight into the decision-making process that has guided his successful investment career. While expressing well wishes to the XRP community, Cardone’s professional instincts led him to part ways with the token, and his reasoning offers valuable lessons for both seasoned and novice investors.

1. Understanding Supply and Demand: A Critical Factor

Cardone’s first rule of investing revolves around understanding the dynamics of supply and demand. If he cannot fully grasp these elements for a particular asset, he chooses to avoid it altogether. With XRP, Cardone expressed concern over its supply mechanics. Ripple, the company behind the token, unlocks 1 billion tokens every month but locks back 800 million XRP, leading to an ongoing cycle of supply being added to the market without clear signs of resolution. Ripple holds over 37 billion XRP in reserve, which, in Cardone’s view, creates uncertainty regarding the token’s long-term prospects. This lack of clarity surrounding supply was a significant factor in his decision to exit the asset.

2. If You Can’t Draw It, Don’t Do It

Cardone’s second rule emphasizes simplicity and clarity. He believes that if an investment can’t be easily explained or visualized—preferably on a whiteboard—then it’s a red flag. This principle stems from his desire to only back well-understood assets. According to Cardone, investments should be straightforward enough that even someone unfamiliar with the asset could grasp the concept. For XRP, its complex supply structure and uncertain future made it difficult for Cardone to clearly define, pushing him to sell his holdings.

3. Avoiding Price-Focused Speculators

In his third rule, Cardone advises investors to avoid those who focus solely on the price of an asset, rather than its underlying value. This behavior often leads to speculative trading, where price fluctuations dominate decision-making. Cardone cautioned against relying on price movements to dictate investment choices, especially in markets like cryptocurrency, where volatility can be extreme. Instead, he recommended focusing on the long-term value of an asset, not just its short-term price shifts.

4. Ignore Short-Term Noise

For Cardone, long-term planning is crucial. He stressed the importance of avoiding distractions caused by short-term market noise. Cryptocurrency markets, in particular, are known for their volatility, with prices often fluctuating drastically. Instead of reacting to daily price changes, Cardone advocates for a strategy that is aligned with an investor’s broader, long-term goals. By ignoring the day-to-day volatility, investors can remain focused on what truly matters for long-term growth and success.

5. Consolidated Bets Lead to Great Wealth

Cardone’s fifth rule centers on making concentrated bets rather than spreading investments across too many assets. He believes that focusing on a few well-researched, long-term investments increases the potential for significant returns. Instead of dividing his attention and resources among multiple assets, Cardone prefers to make fewer, more strategic investments that align with his overall goals. This approach, he argues, is key to building substantial wealth over time.

6. Never Follow the Crowd

Cardone’s most crucial lesson is perhaps the most counterintuitive: never follow the crowd. He believes that the masses are often wrong, and investing based on popular opinion is a risky strategy. In the case of XRP, he acknowledged that there is significant excitement within the community, with many investors holding high hopes for the token’s future. However, Cardone emphasized the importance of conducting independent research and forming one’s own convictions rather than succumbing to the hype or following trends.

Conclusion

Gary Cardone’s decision to sell his entire XRP position offers valuable lessons for investors in all markets. By focusing on understanding supply and demand dynamics, avoiding price speculation, and sticking to long-term goals, Cardone’s approach to investing remains grounded in clear principles. Although he wishes well for XRP holders, his six rules reflect his belief in making informed, independent investment decisions based on solid understanding and long-term strategy.

In the wake of his exit from XRP, Cardone’s reflections serve as a reminder that successful investing requires a clear vision, discipline, and a willingness to go against the crowd when necessary. His decision underscores the importance of understanding an asset’s fundamentals and staying focused on the bigger picture, rather than getting lost in the noise of short-term market movements.