Thread
1. NFT/CRYPTO DISASTER RECOVERY. Sitting on big losses? Feeling anxious or frozen? No idea wtf to do rn?
Here's a thread on how to get yourself out of the hole.
Here's a thread on how to get yourself out of the hole.
2. I've been in a position of sitting on big losses a lot of times actually. Lost my entire year of PnL in the space of a few hours in 2013, 2016 and 2020. In my last job, I went from being +$10m to down -$5m in just one day...a $15m swing to be sitting on $5m of actual losses.
3. So, over the years I've developed a few ideas and somewhat of a structure to help me through and get back on the right track. A lot of it is about changing your mindset and getting yourself comfortable with what you own.
4. Step 1: Go outdoors for a walk, a run, a workout class...go lift some weights or play football or something. Spend an hour or two away from your screens doing some kind of physical activity to clear your mind. You want to come back with a fresh mind.
5. Step 2: Take a pen and paper and write down all your exposure; try to do this away from your laptop, or refer to your laptop if needed but once it's written down then go sit somewhere else; preferably not the desk you usually work from.
6. Step 3: Look through what you own and write down your conviction level next to it, give it a score of "Low", "Medium" or "High".
7. Step 4: At this point in time, you have to honestly ask yourself if you have too much money in crypto. Can you afford all your bills? Have you been saving for a house? What about kids' tuition fees?
8. There's lots of examples but if crypto money is preventing you from completing life's necessities, then I strongly advise to immediately sell what you need to, from low to high conviction, because things can definitely get uglier from here and you don't want to fuck about.
9. Step 5: So from this point on, I'm going to assume that the money you have in crypto and NFTs is money that you can afford to invest/gamble or at least hold for an extended period of time.
10. Your high conviction positions, you should feel comfortable about holding here (and probably even want to add). If you don't feel that way then your conviction is not high enough. You understand that in the long run, this thing is gonna work out and bounce back at some stage.
11. Step 6: Convert all your low/medium conviction positions into your high conviction positions. For many of you, this might just be selling things for ETH and holding ETH. You'll take some big losses, but you have to be disciplined here.
12. You have to be disciplined about identifying what is a gamble and what is an investment. In last year's crypto crash in May I sold whatever I could for ETH and just held ETH.
13. I didn't really know or understand anything else I was holding and once I took my Ls and moved all into ETH I felt comfortable holding it and didn't really care about the daily price movements, and actually kept adding more ETH on the way down.
14. Step 7: So you've now achieved the following: you've gone from being paralysed to having a plan, and you have specific actions to take...you have a gameplan. Once you've moved everything to high-conviction positions, you should feel comfortable about holding through any vol.
15. Step 8: If you have spare liquidity, now is a good time to start accumulating and averaging down too. Be robotic about averaging down; either buy a small amount each day for a set period of time or set yourself limit orders to add a bit more once at lower levels.
16. Learn from your mistakes. A lot of you will be finding now that there is no liquidity to sell your NFTs because everyone is trying to sell at the same time. Floor prices are prices you can BUY at not SELL. Recognise what is a quick flip/gamble and don't get over-exposed.
17. Write down all the mistakes you made this cycle and refer to them daily at the start of your day as not to repeat them. Trading is a game of risk taking and discipline; the perfect combination of those will make you consistently successful.
18. If you've read this thread before, sorry for the repetition, but I couldn't find the original online but luckily had this saved locally!
It is a good reminder though and you should compare this to last time and ask yourself if you got into a better position this time round?
It is a good reminder though and you should compare this to last time and ask yourself if you got into a better position this time round?
