It’s SO Over: A Retro on My Biggest Trading Fumbles

Losing money in crypto is a special kind of painful. You can go from being up big to down bad in a matter of days, hours, or even minutes, and the volatility is intense.

The worst way to lose money is when you make a mistake you’ve already made in the past. There is nothing like the anguish of fumbling a trade and having no one to blame but yourself because a) you were an idiot and b) you should have known better.

This year I’ve taken some L’s like that. Think: buying the top, selling the bottom, using leverage to make up for previous losses, and so on. It’s made me realize I need to review my past, so I don’t keep getting rekt in the same ways again and again.

To that end, what I’m going to do with this post is go through my 9 worst trading failures and share the lessons I took away from each experience. I hope it’s helpful to anyone reading.

The pain starts back in 2020 during DeFi summer. I was excited about Ethereum infrastructure, so I participated in a presale for The Graph (GRT). As soon as the token became liquid, I sold my stack for a 3x return because a friend told me there were going to be better solutions. I thought I was a genius for about 20 minutes, then I watched the token pump another 10x. Lesson: when you have conviction in something, don’t let other people convince you otherwise.

In early 2021, I was in a group chat with people who minted Bored Ape Yacht Club (BAYC). I thought they looked ugly, so I chose not to mint. And as the collection rose in value I refused to buy in “late.” Looking back, it would have been much less painful to buy a few apes early and hold them instead of letting my ego get in the way of making money. Lesson: when you see organic activity around something… participate, and buy in if you can.

In April and May 2021, Ether (ETH) had a massive run up. There was a lot of hype around the EIP-1559 upgrade, and people said prices were going to 10K per ETH. I bought into that narrative, held through the whole move up and down, and round tripped all my gains. Lesson: when markets get overheated, sell some of your stack to lock in partial profits.

After ETH collapsed, I sold off some other tokens to make up for the money I lost. One of the altcoins I sold was a project called Abracadabra (SPELL), which no one had heard of at the time. I was a top 5 holder. Fast forward and Abracadabra became a mainstream DeFi protocol briefly, and SPELL went up 100x from when I sold. It would have been a 7 figure gain. Lesson: never put yourself into the position of being a forced seller. Lesson two: always keep a “moonbag” (a small number of tokens) from projects that you think have potential.

Through the second half of 2021, I did well with NFT mints, but I ended up losing most of those gains on Redacted Cartel (BTRFLY). In early 2022, this token had a good narrative around “metagovernance” of other DeFi protocols, so I bought it. When price went down, I kept buying more, and as it collapsed, I lost low six figures. Lesson: don’t average into a losing token (you’re not early, you’re wrong). Lesson two: there is a game of shitcoin broken telephone across crypto twitter and its various group chats… determine where you are in that information stream because if you buy late, you’re someone else’s exit liquidity.

After the loss on BTRFLY, the same metagovernance narrative led me to a project called Liquid Driver (LQDR) on Fantom. I bought a meaningful amount early and staked it. The coin went 15x and I couldn’t withdraw or sell my staked position, so I round tripped and didn’t make any money (other than a sexy $2.78 of yield on what would have been a six-figure position). Lesson: never stake something you plan on selling over a short time horizon.

In the spring of 2022, I bought Cyberbrokers after they minted. I told myself I would sell after a 2x, but as they became popular on Twitter and the floor kept rising, I kept waiting for them to go higher. Eventually prices started dropping and I still didn’t sell… this time because I was hoping they would go back to their previous high. After the hype died out I ended up dumping my collection for minor gains. Lesson: have a plan for when you want to sell something and don’t move the goal posts no matter how much sentiment changes. Lesson two: hopium is a drug, be mindful of it.

After the small win on Cyberbrokers I aped that money (and other gains from trading shitcoins) into Premint passes. My assumption was that the NFT euphoria of early 2022 would continue. I ended up selling those NFTs into bids after everything collapsed and lost high five figures. Lesson: once you’ve made some money, let it settle before making new plays. Also, don’t gamble more than you’re comfortable losing. It hurts.

Fast forward to January 2023, and after a long year of chaos in crypto markets I finally came across a project I was excited about: Checks by Jack Butcher. I bought in early but quickly decided to sell most of my collection when the floor price went 3x. Soon after, Checks ripped much higher and I left six figures on the table by selling too early. Lesson: after losing money in bear markets, it’s hard to see new opportunities objectively. Fight through bear market PTSD.

The way I cope…

The “what if” game of crypto can be haunting. But I’ve stopped thinking about how much I could have made (or not lost) if I had behaved differently. Instead, I see all these fumbles as tuition that I’ve paid to become a slightly less stupid market participant.

My sense is people have to make every kind of mistake in markets to internalize these lessons. There’s something visceral in personally having money on the line and losing it in specific ways that is irreplaceable.

The trick is you need to ‘remember to remember’ and not let greed or fear drive you to make the same mistakes again and again.

Thank you to Merp, Emmy, Patrick, Herbie, and Lamboland for feedback and review of this post.