From an investment genius to a 27-square-meter subdivided apartment: My 540 days and the painful philosophy of cryptocurrencies

This article explores the inevitable psychological pain involved in cryptocurrency investing and offers a framework for transforming it into a valuable learning experience.

Types of Pain: The author categorizes crypto-related pain into three levels: the pain of missing out (FOMO), the pain of jealousy towards others' gains, and life-altering pain from significant financial loss.
Reframing Pain: Pain is redefined not as a setback, but as tuition paid for education, proof that you are gaining experience, and a signal to reassess your strategy.
Personal Story: The author shares a personal account of severe, life-changing pain after the UST and FTX collapses wiped out their liquidity, forcing them to live in a tiny subdivided apartment for 540 days before recovering with the help of the Arbitrum and Pendle ecosystems.
Actionable Strategies: Practical advice is given to manage pain, including:
- Clearly labeling the type of pain you are experiencing.
- Splitting funds into survival, growth, and speculative portions.
- Setting strict exit rules for trades.
- Turning jealousy into actionable research by analyzing others' successful trades.
- Regularly calibrating your trading system to adapt to changing market conditions.
Core Philosophy: The key to success is to face pain directly, learn from it quickly, and adapt at a speed "beyond your self-esteem" to persist and ultimately be rewarded by the market.

Author: 2Lambroz

Compiled by Tim, PANews

Everyone loves to show off their earnings, screenshots, and stock price surges, but few people talk about the pain.

If you want to achieve something in crypto, you have to go through pain first.

The key is how you deal with pain.

Pain Level

1) The pain of missing out

Too early, too late. Cut at the bottom, empty at the top, chase halfway.

Symptoms: Compulsively checking market charts and instantly regretting it.

Cost: Fees, small losses, erosion of confidence.

2) The pain of jealousy

Others are taking action, but you are just watching. You call it a "crime," you call it "illegal gains," you call it what you will.

Symptoms: Crazy screen swiping, moral preaching, and abuse of muting.

Cost: Missing out on trends, shrinking connections, and falling behind in learning.

3) Life-Changing Pain

Real life faces risks: leverage breaks down, counterparties default.

Symptoms: Lack of sleep, fear of bills, avoiding phone calls.

The cost: financial loss and years of emotional trauma.

Pain Trap

People are always eager to sell coins that have risen in value, simply because they are afraid of incurring losses.

The reason people insist on doubling down on their losses is because they don't want to endure the pain.

People often mistake temporary pain for permanent damage.

Is there any meaning in all this? No, it's just letting pain take the wheel.

Re-understanding pain

Pain is tuition

You paid the price to learn, do your homework: write down what happened, why it happened, and how you will respond next time.

Pain is proof of experience

You're taking risks with caution, which is good. Keep it in check so you can continue.

Pain is a signal

Are you playing the game you want to win? Traders, investors, miners, builders—each game has its own threshold.

Turning jealousy into action

You looked down on Aster, calling it dirty money, and missed out on a great opportunity. And then... the results proved it all.

My mom is a traditional Asian mother. When I was a child, she was very competitive and always wanted to compete with others. If the neighbor's children did better than me in the exam, she would immediately hit me in the face with a slipper.

I had two choices: to outdo him or to befriend him. Most of the time, I chose to befriend him and learn from him. Why take the hard way when you can get what you want?

This instinct has shaped how I handle jealousy in the crypto space. Instead of wasting time on resentment, I turn jealousy into information.

How to turn jealousy into an advantage:

When others put forward their opinions, don't rush to deny them, but first understand why they say that.
Reverse analysis of early signals: on-chain capital flows, Telegram community discussions, abnormal perpetual contract rates on centralized exchanges, KOL social dynamics, and liquidity injection strategies.
Add this information to your own checklist.

Jealousy doesn't necessarily erode you; it can also sharpen you, as long as you turn it into action.

Some say you have to go through it once to reinvent yourself. Maybe, but once you've gone through it, the only thing left to do is never go through it again.

What is life-changing pain? Here’s how it happened to me.

I used to work in the building materials industry. After earning a healthy share of the profits, I invested them all in Hong Kong real estate. I essentially leveraged within the regulatory framework. At a young age, I bought two properties and a parking space in Hong Kong. At the time, I felt invincible. I held onto my mortgage payments to avoid liquidation, and the market only rose, never fell.

My first cryptocurrency investment cycle also went well, so I increased my investment.

Then, UST and FTX collapsed in quick succession. My liquidity was practically wiped out, and even the down payment for my second property was gone. Having quit my job to focus on crypto trading, I rented out my home to pay off the mortgage, living in a subdivided apartment of less than 27 square meters for a year and a half. Those 540 days, confessing to my girlfriend, hiding it from my family, and hiding it from my friends, were like walking on broken glass. (Note: A subdivided apartment, also known as a room within a room, generally refers to a building unit shown on the original approved building plans that has been divided into two or more separate rooms.)

Fortunately, with the help of the Arbitrum DeFi ecosystem and Pendle, I stood up again and changed completely.

I learned a hard lesson about risk management. I promised myself I would never again create life-altering pain, knowing full well that I was lucky to have been able to rebuild my life.

Don't take the trader's words "die if you die" too seriously. The joke will stop being funny if it goes on.

How to effectively relieve pain?

1) Mark the pain level

Say it out loud: is it timing, jealousy, or a life transition? Naming your pain will help you avoid making a big deal out of it.

2) Split funds

Survival funds, growth funds, and speculative funds. Protect the foundation of survival at all costs; future opportunities depend on your survival.

3) Set exit rules

Maximum single-day loss, maximum single-position loss, maximum drawdown before closing a position. Rules made in a calm state are always better than decisions made in an impulsive state.

4) Review from different angles

Winners and losers, what are the key signals and what is market noise, and how will you respond when the same situation arises again.

5) Principles for dealing with jealousy

If a coin you once mocked has quintupled in value, your next move is to privately message the relevant individuals rather than making insinuations. Find a new signal from this trend to update your investment strategy.

6) The trading system needs to be calibrated monthly

Advantages will fade, and markets will become saturated. If your trading system stops printing money by the end of 2024, it's not a system malfunction, but rather a shift in the landscape, requiring a timely update.