Today Edward T. Giraffe is a successful cryptotrade. But at the beginning of his career he tried with excessive self-confidence to beat the market. It cost him $ 9 million. Read his story – and never do so.

In 2015, my bank account was about 90 thousand dollars. And I bought 11,700 esters for about $ 0.97, and in a few months I accumulated 21  bitcoins  (the total investment was about 17 thousand dollars).

Today I have 1.2 million dollars in pension and usual accounts, 650 ethers and 21 bitcoins.

At this moment, most of the interlocutors exclaim: “Damn, you’re a millionaire.”

Yes, I really got rich thanks to the crypto currency, but let’s figure something out. Today the airwaves cost more than a thousand dollars. If I  bought and kept  it, then now I would have about 11 million dollars!

Of course, I did not adhere to this wise strategy. Below I will tell you how I tried to beat the market, which cost me about $ 9 million. And here it is necessary to note an important circumstance: I’m not talking about missed opportunities (“Damn, I wanted to buy bitcoins for all free money in 2009!”), But about specific decisions in the course of active trade, when I made a choice in favor of somebody, then the “smart” move, instead of keeping the tokens bought on hand.

I hope these lessons will be useful to you. I understand, I was very lucky that I generally stayed at a profit, and I hope that after reading this, one of you will be wiser than me and will not repeat my mistakes.

Mistake # 1. DAO and downgrade

Anyone who was interested in the broadcast in early 2016 will never forget the abbreviation DAO, and I invested in the DAO two thousand ethers. In the end, I returned everything (I also received some ETC as a result of  branching ), but my mistake was not in this. In fact, I was terribly lucky – so it turned out that I sold a lot of broadcasts the day before breaking into DAO!

The price of the air was steadily increasing as the date of repayment of the deposit to the DAO approached, and finally reached $ 21, so on June 16, I sold a bunch of broadcasts for $ 19. In the early morning of June 18, DAO servers were hacked, funds were stolen from accounts, and the price of the air dropped to $ 12 in a few hours. I also had an order for a purchase of $ 14, so I became 800 more.

Not bad, huh? However, then it was completely not obvious, than the business will come to an end. What happens if a hard branch occurs? And if it does not? Everything, aether end? Nobody understood anything, but a lot of people were against branching, although by its results everyone had to get back their money. I also thought that there would not be anything good in this case, so somewhere in the 12 hours after branching (but before the appearance of ETC tokens), I first decided to play on lowering ETH.

Oops. The market voted for the branching, and the ETH rose from $ 11 to $ 14 per night for one night. I told myself that I would wait until $ 16 (the position was to be  liquidated at a price of $ 18). But no, watching as this dastardly green candle creeps up, I panicked. With tears in my eyes, trembling hands, I pressed the button “close the position” – and recorded a loss of 30 thousand dollars. This is my biggest loss as a  trader .

A downward leap with a shoulder is a lesson for hedge funds or idiots.

For a few days I was very depressed, especially after a couple of days the price dropped to $ 10.5.Gradually, reading the stories of those who lost much more on Reddit, I came back to normal, and then I got distracted by the drama unfolding around  Ethereum  Classic. Life continued.

Moral: Never play on a slide – it’s very stupid.

Mistake # 2. Trade on emotions

After the incident with DAO, a new crypto currency, Ethereum Classic, appeared. Being a real fan of Ethereum, I was offended by the very fact of its existence, and loyalty, pride and all moral considerations suggested that you should immediately sell all ETCs for ETH.

So I did. Three days later, as a result of the marketing campaign organized by the supporters of ETC, the token went up five times. Nightmare. My blind devotion to the project, with which I did not have anything, cost me dearly.

That summer Monero currency became popular – it was convenient for her to pay for one popular site in darknet (where they buy and sell any banned through Tor “in the name of freedom”). Confidentiality has become very fashionable, and on this wave Monero and Dash began to grow in price by 30-70% per day.

Of course, I decided that this is a mistake, because compared to BTC and ETH, these new tokens are useless for anything. Is it logical? I thought: “Now they are getting more expensive, and then they will fall.” So I emptied my account on the Poloniex exchange, clicked on the Margin Trade tab and shorted Monero and Dash.

I somehow forgot that the game on the slide is a bad idea

And again a failure – minus 10 thousand dollars. Then I licked my wounds and tried to understand what had happened, however, unsuccessfully. The market is a market. In general, because of the false loyalty of BTC and ETH, I again screwed up.

Moral: Do not get hung up on your favorite team – the market does not give a damn about it.

Mistake # 3: Buying a Hype

Any reasonable investor will tell you that  diversification  is a good idea. I was told that if you buy a few shares hoping to beat the market, Warren Buffett will personally punish you for not buying an index fund.

Alas, there are no index funds in crypto-currencies, so at the end of 2016 I decided that it would be nice to exchange some bitcoin and ether for other crypto-currencies.

But what to buy? Recently, Vitalik Buterin himself said that he likes the Synereo project team. So I bought Synereo AMP – it’s something like Facebook for a  blockbuster  or something. And they just had a sale! This is luck. And they also gave a good bonus for the contribution from 10 BTC. In general, it was obviously a good idea.

But no.

Soon the Synereo team quarreled, the leading developer went on to make a new block project, and in early 2017, when the rest of the currencies began to recover, the AMP fell below the plinth. I sold everything I had for a pathetic three bitcoins.

Moral: Do not buy it simply because someone said it’s cool – at first read something.

Mistake # 4. Swing Trading

Despite the fakapy of 2016, in the new year I entered with 9.5 thousand ethers, some number of tokens from different ICOs and their bitcoins. It was not bad, but it seemed to me that there was not enough ether – I wanted a five-figure sum.

So in March 2017, when the airwaves went up dramatically from $ 10 to $ 13, and then to $ 14, I said to myself: “It’s growing well, but it’s not for long. The ether always rolls back after $ 14. ” And I sold some of my ethers. The price has risen. I sold a little more. The price has again grown. I sold a little more.When it reached somewhere up to $ 25, I panicked. In general, I sold 4.5 thousand averages at an average price  of $ 16.

“He’ll fall back, do not worry, he’ll fall – and you’ll buy a cheap loan.”

While I was saying this to myself, the price first passed for $ 30, then for $ 40, and then for $ 50! Damn it! There were small gaps, but nothing even close enough to bring my reserves back to 10,000 aether.Finally, I gave up and bought for $ 85.

Yes, selling $ 16 aired did not help me make millions

Do you think that after that I made up my mind? Nothing like this. Every time ETH jumped for twenty or thirty dollars, my finger reached for the “sell” button, I still hoped to catch the crest of the wave and ride it. All this resulted in several small victories and a couple of major defeats, and by the end of June my portfolio was 80% of cash, and the balance was in ETH and BTC, both currencies were at historic highs.

Morality: Predicting the future will not work. Sell ​​in two cases: if you have reached a pre-set target value or if you need money. If it seems to you that you will now beat the market, relax – you will not beat him.

Mistake # 5. Panic

In July 2017, ether and bitcoin fell in price relative to historical highs, and I thought that this was my chance. I decided that I will set  limit orders to buy  ETH at a low level (for example, $ 140) and wait for a convenient moment. So I did: I created a whole cascade of orders from $ 155 to $ 135 and left everything in this form.

On one fateful Saturday night, when the prices for ETH fell slowly, I went to bed and fell sound asleep. In the morning, my wife woke me up – she decided that something had happened, because my phone was vibrating all night. It turned out that these were notifications about the execution of my orders.

I was in a panic. Even without drinking coffee, I grabbed the phone and saw huge red candles. I quickly logged in and canceled the remaining orders. It seemed that the fall would last indefinitely, but in case a rebound occurs, I placed a warrant for the sale of all newly purchased air tickets 5% above the current price.

These orders were executed in a few hours, and the price continued to grow. Ether for one day recovered by 80%, reaching almost $ 240 per piece. Alas, I could not take part in these wonderful events, because I sold everything at $ 160.

If I adhered to the plan and left my initial purchase orders, and then suffered one day, I would get back my 10 thousand ethers.

Moral: Make a plan and always stick to it. And besides, keep yourself in hand and never make deals without drinking coffee.

Mistake # 6. Senseless impulsive deals

In the summer of 2017, ICO fever was in full swing, and I was spending my airs on any placement with a fixed minimum amount that I could reach. Yes, I was one of those freaks who pre-configured the transaction to buy BAT tokens and offered an astronomical number of GAS tokens to expedite the transaction (and I’m not ashamed).

Approximately at the same time, Bittrex sharply increased the volume of trading, and there were new exchanges – Binance, Liqui and KuCoin. So many things! And I bought all this – to scroll through the list of positions in the Blockfolio, it took me five minutes.

And then there was a problem, not of an economic, but of a psychological nature – it was impossible to keep in mind all the information and news on all these companies and tokens.

“Of course, this also needs to be bought, what’s wrong with that?”

And for a while I drowned in this sea. I bought on a wave of HYIP, I sold it when the price grew, I bought what I just sold, here ICO, there ICO, and so on without end.

It was stupid. Firstly, because I felt that my head would burst from day to day. Secondly, for many transactions I paid in bitcoins and ethers, which reduced my reserves. And, when this or that currency grew relative to the dollar, I was happy, but for some reason I forgot that it loses in growth bitcoin and ether, so in the end I do not even know if all these actions were meaningful.