Liquidated

As you might know, I work in the crypto sector (well, crypto-tax) and I was recently a week at my employers’ office to have some in-person meetings with coworkers (some things just work out better if you sit down in a meeting room for dedicated stuff).

We also talked about Japan (a coworker had a three-week vacation last year, but more on that in another post). Another topic that came up was Perpetual (or Leveraged) trading.

If you don’t know about it, it is similar to normal stock trading, but instead of taking your own money, you borrow some to get some leverage on the position. This also allows you to “short” (sell assets you don’t own yet to buy them back at a cheaper price) positions.

I did some leverage trading on stocks a while back and lost some money, but I recently converted some of my crypto gains into other cryptos, so I thought I should try out a bit with some of those gains.

Well, the market has been going down (some say it’s a “bear trap”), and I had to keep putting collateral into my position to keep it going. I thought about putting more in yesterday, but didn’t. Well, I got liquidated last night. Your collateral doesn’t suffice the borrow amount and thus your position gets closed, and you lose everything related to that position.

I should be in the burnt kid state now (you probably know the analogy “The stove is hot, don’t touch it”), but I’m not. So I’m putting some more money to risk. What could possibly go wrong? 🙈

At least I’m saving on some tax payment now 🙈