The following tweet wasn’t a joke. I actually lost millions in this fashion over roughly 8 months from end of 2021 through 2022.

My wealth was a low-interest-rate phenomenon. I lived the wisdom “some lessons must be experienced”. It made me recalibrate my identity.

I’m glad it happened. On devastating losses, and what you get to keep.

I went from thinking I was essentially retired to realizing how painfully naive I was. I made a lot of it in SaaS stocks. Even adjusting out leverage, I still outperformed $QQQ and $WCLD (tech indexes). Doesn't matter though, because I massively underperformed on the way down.

Throughout this, I also experienced my first death of a truly loved one. I’ve had grandparents and people I know die, but it never broke me or even made me cry. This was the first time I’d faced a real loss. It changed my views on life and death and dramatically changed my empathy when I encounter suffering. Some lessons must be experienced.

I also ended a 3-year relationship during it. It was for the best, still very hard.

All this coalesced to amplify the pain of the financial loss. Calling it brutal is an understatement. I lost some of my identity in a way. When you perceive yourself as “successful guy” and a large part of the reason you give yourself for why you are this thing is gone…. it’s not fun realizing you’re no longer that thing.

I want to share the framework I used for thinking about the aftereffects of these losses, and how I’m able to say I’m glad it happened. Note: this is regarding financial losses, not personal losses of loved ones.

Regarding traumatic events: you don’t get over it, you get through it.

Your loss will be consuming as you internalize the depths of your failure. It will be dark and painful. There is no way around this.

You must contextualize. Those who don’t contextualize will succumb to it. A soul-crushing event feels like the most-awful, permanent thing ever while you’re enduring it. You must be able to frame your loss and situation in the context of a life cycle.

You are at the lows, it’s extremely unlikely you will stay at the lows. You’re experiencing the same feelings someone who panic sells the bottom does; these impulses are not limited to just investing.

Your life path resembles a stock chart, you don’t get highs without lows. You are now getting dumped on. Your good fortune just got liquidated. Maybe you’re considering liquidating yourself now. You can interpret that however you want.

This isn’t some “hey man you’ll make it back” pep talk. You might not.

You may not make the money back, but you will make something back, because you did just learn something. But it’s up to you to use what you got to keep.

THOUGHT EXPERIMENT #1

What did you get to keep that you gained during this wealth creation/destruction process? How valuable is it?

Reflection: would I rather have…

• the money I had, but with no new skillset from the process
• the skillset, but no money

Pretend you still have all your money and you’re told you can only keep one thing: the abilities you cultivated as a result of this cycle, or the money you made….. which would you keep?

I genuinely would make the trade for the skills over the money. I consider the skillset far more valuable over the long run. I still have the skillset, that did not get liquidated. I get to keep that.

What I’ve learned during the creation of wealth, loss of it, and my downstream decisions as a result have been more valuable than the nominal wealth. It’s absolutely worth several million to me.

If I lost 8+ figures I'm not sure I'd feel this way. At a certain point the raw amount is too much to deny, and you’re just coping saying otherwise. This value assessment is something you must make on your own. But make it honestly and be fair to yourself.

If the ‘what would you trade for?’ thought experiment drew a scoff…. did you not learn anything from your failures? If you didn’t even pause for a bit to reflect on if you’d make that trade or your instinctive response was to mock it as “cope”, congratulations on learning absolutely nothing. “I never lose: I either win or I learn” definitely doesn’t apply to you. It’s likely you’ll eventually be parted with your money, give it time.

YOU ARE PATH DEPENDENT, AND YOUR PATH JUST CHANGED

A fork in the road was forced on you. How will you act differently now your money is gone? Because you will definitely act and think differently. You'll make decisions you wouldn’t have otherwise. This will likely lead you to meeting people you would not have met otherwise.

I felt quasi retired for about 2 years, just managing my own assets and being very very online (I’m still very very online). I wouldn’t have looked for work had this not happened, because I didn’t need to.

This loss elicited a behavior change that made me hunt around DeFi to see what was out there. I didn’t lose everything, so I could still be picky about what work I wanted, but I lost enough that it made me start looking. A nice sweet spot of “motivated but not desperate”.

This led me to something awesome. I’d much, much rather be doing what I am now than just managing my money.

Occupying your time with something purposeful is good for you. It provides structure to your day and makes you feel like you’re contributing to something. When others rely on you, you rise to the occasion and feel a sense of importance.

It's deeply important for people to feel purposeful. I kind of lost that when all I was doing was managing assets. Don't get me wrong it's a good problem to have. But it was definitely lacking.

The stories you commonly hear when someone wins the lottery or makes a lot of money and then wastes away is from the loss of purpose that comes from having no motivation or structure. Like it or not, work provides this for most people. I was not exempt from this.

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An environment where others depend on you and trust you to do something well is unambiguously good. It’s also good for your ego, it feels good to create something valuable and know you’re instrumental to it. It’s good for creating structure for your day, it’s good to allay depressive thoughts, and to top it all off it’s good for your bank account. Obviously some jobs do this better than others, this certainly does not uniformly apply to all forms of work.

I like to make fun of “wagies” too, but what I’m describing isn’t this. It becomes wagie-ism when it’s stultifying, rote work that you do purely for the paycheck. The acid test: would you quit in a heartbeat the second your living expenses were covered?

I’m grateful for the path I was put on from this loss. It led me to RabbitX and the brilliant people I now get to surround myself with. It led me to new people, experiences, and motivated me to put together the writings and thoughts you see on this account (@BackTheBunny)

To say I’ve learned a lot is a massive understatement. Our V1 was interest rate swaps called Strips Finance, and we struggled to find PMF. We then pivoted to our V2: perps, called RabbitX. I did mostly research, communication, and strategy during this pivot-and-rebuild process. DeFi teams are small teams and you must wear many hats.

When RabbitX launched, we knew the tech was superior and our team as good as any, but the best tech doesn’t always win. We had to get noticed. Part of what I was tasked with was figuring out a guerilla-style way to add value and visibility.

I always wanted to put together the thoughts, threads, posts, memes, etc you see from me on Twitter. But I never did, I wasn’t sufficiently motivated. I now had that motivation. I saw this as an opportunity to impose accountability on myself to write and think outloud on a regular basis.

If it worked, it would act as a positive amplification of us as well as being rewarding on a personal level. It’s a beautifully aligned incentive structure; the better my writing, posts, etc., the more it reflects positively on both RabbitX and me. If I wasn't motivated now, I never would be.

Getting financially BTFO’d put me on a path I enjoy much more than my previous one. I’ve learned a ton and contributed in a meaningful, multifaceted way to a project within an industry I deeply believe in and care about. I would have never done this had I not had that devastating loss.

Putting out these thoughts and this work has been way, way more enjoyable and edifying than what I was doing while “retired” and just managing my own money. I honestly can't imagine working in any industry other than DeFi.

THOUGHT EXPERIMENT #2

Would I rather have:

• the money I had previously
• The experiences, relationships, and skillsets I’ve cultivated working in DeFi, in addition to the positives this account has brought me

I choose the second option, and it’s not even close.

Being a key part of building and growing a product are highly transferable skillsets. What I’ve developed here both personally and professionally will be applicable to other things I do. This has been time well spent on multiple fronts.

The lessons and relationships I’ve amassed as a result of that painful wipeout are worth more to me than what I once had. So how bad was that loss really? It’s put me on a much better path than what I was on back then, it just reallllly didn’t feel like it at the time.

This is why you must view tragic experiences holistically. This means considering new paths and opportunities you may now encounter.

If what you experience on this new path is better than the previous one, was the horrible thing as horrible as you thought it was?

What happened to me was necessary. I would not have learned some hard truths otherwise. Without these lessons, I probably would have lost that money eventually anyways.

In bear markets, stocks (and crypto) return to their rightful owners. I was not their rightful owner; I am now better equipped to be that owner next time.

I’m also far more emotionally resilient now. If I get hit again, I doubt it will impact me as badly.

I had some dark thoughts during these times. When you’re in the depths of a life liquidation event, it feels like it’s the end. But you’re only truly liquidated if you liquidate yourself. There is no life margin call, it’s internally issued. Don’t issue a call on yourself.

The new path I’ve been put on as a result of losing that money is worth more to me than the money itself. There is a victory there. View it like a trade: I traded a large sum of money for a situation I value more than the money. I like this trade.

You must zoom out and see your victories too. You must contextualize. Give yourself credit for your victories, most people don’t do this enough. Be hard on yourself, but don't be a tyrant.

Don’t only see the shitty decisions you make, see the good stuff too. Not doing so is like only looking at one side of a balance sheet; you don’t know if you’re solvent just looking at your liabilities.

If you get obliterated, try to view it as an opportunity to find a situation that was better than what you had before. You can transcend a major loss. Maybe you’ll find something you like more in the process. Be optimistic, what other choice do you have?

Sometimes the journey is the most valuable part of a process, not the end result. We often materially underestimate qualitative value that can’t be measured in favor of quantitative value that an Excel spreadsheet understands.

Skills, connections, reputation > money

Remember what you got to keep, even in the midst of a loss. And look forward to how your life path can change in a productive way.

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