Thread by @ShaharAbrams

A few weeks ago, I was liquidated for >150K $CEL tokens. These were tokens I’d been holding since 2018 and had 0 intention of selling...

I wanted to do a post-mortem🧵on what happened and my own lessons learned. I hope it helps others learn from my mistakes, and reflections👇

context: through late 2018/early 2019 I accumulated a sizable (for me at the time) bag of around 300K $CEL, I don’t know exactly what my cost basis on this position was as it was all purchased on IDEX using ETH... but it was prob around $0.05. I earmarked it as a HODL position

When the token started to moon bigly in mid/late 2020, I started to DCA out a chunk of my position. Why? Simply to take profits and rebalance my then heavily-skewed portfolio

I mean if you don't take profits at 100x+ what are you even doing right?

I sold some at $0.70 (~15x)… and some at $7 (~150x)… but the vast majority somewhere in between! This helped me achieve my goal of achieving financial freedom and I will forever be grateful for that

Even though I sold some too low I never regret following my plan

That said I kept a position of over 150K tokens, these were tokens I had no intention to sell. In hindsight, and forgetting about the PA we've seen for a second, this was too much. It was still a really large chunk of my portfolio and I could/should have diversified some more

Now here's the second mistake: At the end of last year I took a 25% LTV loan against this remaining position, unlocking around 140K USD of spending power

I thought this was a really safe move, $CEL was trading >$4.00, and my liq point was under $1.5

Then on May 11 (CEL Doomsday!), I was liquidated with little warning – as $CEL crashed from $1.5 to under $0.7 in the course of a few hours

I had no time to add collateral but, even if I did, I would not have as the risk of doing so was too great. I would have had to add a lot

I now realize I made two CRITICAL mistakes when evaluating the risk of this play

1. I greatly overestimated the quality of $CEL liquidity

$CEL enjoyed pretty good liquidity in the $4-6 range, but most of this liquidity was on UNIv3!

because of how UNIv3 concentrated liquidity works, as soon as price loses the high-lp range, liquidity can dry up really quickly

This is why $CEL was able to drop so fast and and so quickly on relatively low volume

2. I did not properly underwrite the Beta risk on top of ETH and BTC

In the past CEL has acted as fairly low-beta to the majors. While it is correlated, its +beta value traditionally hasn’t been so high

I should have noticed the Beta picking up and taken this into account

It sux to get liquidated on a long-term position, but what’s done is done. C'est la Vie!

I’m focusing now on rebuilding a modest position 💪, I’m up to ~35k tokens or so. I’ll be accumulating slow and steady under $1

CEL is a high risk/reward play. I’ve read too many stories of long-time community members who were liquidated and way overinvested with their life savings… it breaks my heart

For about 6 months in 2021 I ran a light-touch crypto advising service. I did close to 100 consultations for people of all ages and backgrounds.

For those that were interested in higher risk altcoins I recommended $CEL, but it was only one recommendation out of a handful

and I always advised keeping allocation small, no higher than ~5% of overall portfolio and a single part of a diversified altcoin portfolio. Of course my own $CEL allocation was (unfortunately) a lot higher, that was/is my decision to live with

We must always remember to properly underwrite risk and NEVER go all-in.

The more enamored you are with the project/team/coin, the more caution you must exercise as you KNOW you will be biased. Discipline is key for everyone including #Celsians

tldr; My failure to appropriate size/underwrite cost me a small fortune. Thankfully the lessons I learned in the '18-19 bear kept me disciplined in rebalancing and taking profits. Still this experience has taught me some valuable lessons. I'm still bullish and not going anywhere