Welcome to The On-Chain Coliseum

(Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.)

GM gents. Another week has gone by and your hot wallet funds have not been drained by a malicious link or dormant connected site that you gave permission to when trying to bot a free mint back from last summer. Such is life in this environment, always navigating through landmines to get the WAGMI bag.

While it’s arguable that losing funds to nefarious forces unbeknownst to you is a bad outcome, I would make the case that burning a pile of money through mistakes made that were entirely your own fault is even worse. Pretty gross feeling to look at yourself in the mirror and confront yourself after exploring the art of the possible in being a degenerate.

“Really? You were that deranged?”

The answer is always yes and it stings every time.

I had a pretty bad loss yesterday on $ESPR, which was purported to be a Telegram bot that could automatically deploy shitcoins for you with just a few buttons. Seemed like it fit squarely in the Telegram bot meta - combine that with revenue share and a Unibot partnership and you have what looks to be a winner.

Things were looking up, and we quickly tickled $7m market cap before ranging between $4-6m. Side note - that is a FAT range to stomach. + / - 30% peaks and valleys is extremely volatile, especially when you have size.

Enter stage left… FUD ensues.

Not exactly a ringing endorsement. Naturally, once this thread started making the rounds it was a one-way ticket to jeet town. Lots of money evaporated in a fairly short period of time.

After reflecting upon my heinous decisions in a pitch black room for several hours, I wanted to share a few takeaways here that I probably already knew but cast aside in favor of chasing a coffee bean bag. If you’re an on-chain arena participant, you may find these helpful.

The Golden Rule

Over hundreds of years, gamblers far and wide have come to a consensus on the one thing to never, ever do when rolling the dice: when you’re up, don’t increase your cost basis. Period.

I’ve made this mistake several times before and have always regretted it . It’s tempting to increase your position on a shitcoin trade if it’s mooning, but the pullback will hurt significantly more if you are caught offsides. This goes double for if you’re not deeply in the money. If this is something you’re entertaining, strongly reconsider. Don’t be in such a rush to give it all away because you inevitably will.

Have a Thesis

My best picks have been one where I had a clear angle. Whether it’s a meme or narrative-driven, I gravitate towards memes personally since I feel I have a good handle on them and what people find funny. Pepe was the best trade of my crypto tenure and it’s all because I knew that everyone on crypto Twitter has at least 20 Pepe memes saved to their camera roll. HarryPotterObamaSonic10Inu has emerged as a strong meme contender in this race as well, screaming up past $100m market cap last night and spawning meme mania on my timeline.

These are memes I can get behind. Hundreds of years from now, they will read about us in textbooks and present case studies on the human condition within a crypto bull market.

Singles and Doubles

Derek Jeter, one of the greatest baseball players of all time, made a name for himself on his consistency (among other things). He wasn’t a home run god knocking 450-footers out of stadiums, but was extremely reliable in getting base hits and performing when it mattered most.

Approach shitcoins with a similar mentality. To be clear - I’m talking about size here. If you get in early and ape smol, your risk is low but your upside is tremendously high. Don’t go all-in until your horse in the race is clearly lindy, like Pepe, Hpos10i or Unibot.

I think this point is particularly important. Liquidity rotates FAST and turbo aping on a $3m shitcoin can lead to immediate vaporization of a few ETH. Pick your spots to size up and have conviction to hold for more than 4 hours. Otherwise, throw dust in a shotgun spread and take your winnings judiciously.

Short-Term Memory

nning Regardless of whether you just hit a 20x or zeroed out, it’s critical to jot down your key learnings and keep it pushing. It’s easy to get tilted after a loss and emotionally gambling on 6-figure market cap vaporware is an easy way to find yourself in a cascade of losses.

Take a deep breath, celebrate your win or mourn your loss, then return to the mean and stick to whatever plan you laid out for yourself. Anything but that will inevitably lead to a bad outcome.

Conclusion

Shitcoin summer seems poised to stay. The below thread is a great write-up on why people continue to stay away from NFTs and gambol.

Hopefully you not only learned something this week, but you’ll take something with you and incorporate it into your degenerate chucking. Enjoy and stay frosty.

Cheers,
Chuck