I Lost Everything

In 2022 I handed back every bit of DeFi profit I had made. The useful lesson was not the money. It was the behaviour that made losing it inevitable.

In 2022 I was down to a few hundred pounds in my bank, after making six figures trading DeFi tokens in 2020/21. That was the actual number left in my account after I'd handed every bit of profit back. The Terra collapse, Strongblock, Yieldnodes, personal projects. All collapsed simultaneously, with virtually zero time for me to react. I walked in with my eyes open, but no defence.

If I could sit across from that version of me, here is what I'd say. Not the motivational version. The useful one.

The money isn't the lesson, the behaviour is

I didn't lose that money to bad luck. I lost it to size, with no risk framework behind it, to treating a bull market like it was skill. The temptation at the bottom is to mourn the number. Don't bother. The number was always going to leave if the behaviour stayed.

What you actually lost was an expensive education in exactly how you blow up, and that is worth more than the money was, because now you know the precise shape of your own failure.

2022: don't try to win it back

The instinct after a wipeout is to make it back fast. Same markets, bigger conviction, prove the loss was a blip. That instinct is the same one that caused the loss.

The version of me at the bottom wanted redemption. The thing that actually rebuilt it was the opposite of urgency: accepting the rebuild would take years, and being okay with that.

Here is the bit 2022-me wouldn't have wanted to hear: I was the single point of failure in my own process.

Your scars are your biggest asset

I initially thought that the years of mistakes were time lost. Wrong. Every hole I fell into is now a rule in a risk framework.

The 2022 loss is the most valuable thing I own, because it is the reason I size the way I size, ring-fence what I ring-fence, and refuse to let any single position decide a good month, quarter or year. You can read about position sizing all you like. It doesn't go in properly until you've watched it fail to save you.

The rebuild is slow and nobody claps for it

I'd love to tell 2022-me that it gets easier quickly. It doesn't. The rebuild is slow and mostly invisible, the kind of progress nobody notices because there is nothing to show yet. The compounding is real, just delayed. The work you do at the bottom, when there is no audience and no upside in sight, is the work everything later sits on top of.

Four years later, I rebuilt everything from scratch. People ask where the work ethic comes from; now you know. I wasn't ready to make money in 2021. I was young, naive, and not nearly humble enough. Looking back, I needed those lessons. Without them, I don't think I'd have built what sits in front of me today.

If you're at your own version of 2022 right now, I won't pretend the loss doesn't hurt. It does. But the loss is only the end of the story if you let the same behaviour write the next chapter.

Swallow your pride, take the ego out of it, and rebuild from the ground up. There isn't a faster version. I looked.