Crypto Traders Hit Max Depression: 'Detached from Reality'

Cryptocurrency traders are obstinately clinging to a sense of optimism as they battle for survival under brutal market conditions, even as many reach what one could aptly describe as “maximum depression” on a personal level.

“First time trading crypto that I’m sort of coming to terms with the nonzero chance we don’t have another cycle to bring us past $3 trillion [market capitalization] again,” an account called “Depression2019” wrote on Twitter on Tuesday.

The trader, whose biography indicated he’d been involved with bitcoin since 2014, expanded on his lamentations. “Every single narrative that was supposed to get BTC (bitcoin) to 100k or ETH (Ethereum) to 10k has played out already,” he wrote. “What is left?”

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As one may expect, downbeat traders have become an increasingly common feature of this year’s abysmal economic landscape. Rising consumer prices induced by soaring inflation set the stage for a roughly 70 percent decline in cryptocurrency’s market capitalization — from more than $3 trillion to about $940 billion — compared to just seven months ago.

Those who admit in public to having struggled with the market tend to remain optimistic about its future, but acknowledge that this year’s conditions have taken a toll on their mental health.

“Am I the only one who feels detached from reality and with the markets?” a user going by the screen name “ResetBTC” wrote on Twitter on Tuesday. “Like having deep thoughts every time of.. but we are all going to die sooner or later..?

“I feel alone, there are people around me that still love me like mum and dad I’m lucky to have them alive and checking on me daily but I don’t know, I failed to everyone, lied a lot, and no one can help me (that’s what I think, maybe there is a solution) but [I don’t know], I’m lost. So my point is why should I take care of something that at the end of some time will break?”

1/ Am I the only one who feels detached from reality and with the markets? Like having deep thoughts every time of.. but we are all going to die sooner or later..?

Gotta say I’ve been through some stuff lately, lost a lot of loved ones, broke my 4y relationship gf, lost money..

— Reset (@resetbtc) June 29, 2022

The user said his losses included his own money as well as $400,000 from investors. Reached for comment by GoblinCrypto, he explained that the group included his parents and friends — just some of whom read his Twitter account.

“I turned $100 into $50,000,” the user said. As his winnings snowballed, he said, “People saw my performance and started calling me wanting to give me funds. They gave me around $300,000. Everything was going good until it wasn’t.”

He said he had “made approximately $1.2 million and lost $1.5 million” as of June. And in his public confession, he added, “That’s why I’ve named myself as reset, because sometimes from time to time I need to do a reset of my [expletive] mind and keep calm, and what I am doing now? It’s 4:40am, I have like [$1.6k] on my account left and I need to keep clicking because I feel as I’m losing a lot.”

Reddit users mirrored their counterparts on Twitter on Monday, taking a reflective tone in an exchange titled, “How confident are you that crypto will have more parabolic bull runs in the future?”

“Part of the fun and caution around bear markets could be how low cryptos prices have gone done since the top,” the user who began the thread noted. “It can easily make someone think that it’s both a great opportunity while simultaneously being a bit of a risk too.” He closed in asking his cohorts, “How do you view the risk of crypto at this point in time? Are you certain that crypto will come back strong at some point and when do you think that might be?”

“Pretty confident,” another user replied. “This market has tons of apes that will fomo after the first big green candles.” (Crypto adherents refer to those willing to throw large sums of money around with little thought as “apes,” while FOMO is an acronym for “fear of missing out.”)

“I’m more confident in the greed of people that the actual blockchain technology,” the person added.

Another commenter pointed out, “Around December-January of 2020 we were seeing the rise to $20,-30,000. Would you sell there, thinking it was gonna drop back down? Or do you hold on for what would become 60k a few months later?”

pic.twitter.com/My0yzaYIH0

— Pollo2x (@Pollo2x) June 28, 2022

It merits noting that traders whose portfolios matched the market’s performance of a 70 percent drawdown have outperformed a growing number of professional fund managers this year. Celsius Network, a crypto lender that held $19 billion in assets and approximately $1 billion in equity at its peak last year, froze user funds this month in an effort to defend a $278 million it had taken out on the Maker Protocol.

And BlockFi, a lender that was valued at $5 billion at its peak last year, is struggling to raise $250 million to finance customer withdrawals without relying on a loan from Sam Bankman-Fried’s FTX Exchange. The most recent nail in BlockFi’s coffin was the bankruptcy of Three Arrows Capital (3AC), a multi-billion investment firm ordered into bankruptcy on Wednesday to pay $666 million on outstanding loans. BlockFi said amid this month’s turmoil that it had liquidated its own $1 billion loan to the company.

Compared to the lackluster performance that those companies have put on display, some traders are still flying high. GoblinCrypto spoke with one investor in cryptocurrency gaming who, as of June, had lost more than $5 million since the height of the last bull market — but still managed to retain a 2,500 percent return on his initial investment.

“I never really believed in crypto or DeFi (decentralized finance),” said the investor, who did not wish to be named. “I just loved playing RPGs/strategy games, so when I saw couple of crypto games, I got into those and built some experience. A friend of mine pushed me into [the most successful investment].”

After an initial investment of roughly $20,000 ballooned to $6 million within a matter of months, he said he cashed out about $500,000, but that he and his fiancee “decided to keep the rest of the money in and live with the results.” As of late June, the value of those holdings had declined from their peak by more than 95 percent.

Ironically, he added, “I still don’t believe in DeFi or most of crypto. But crypto with games for me make sense, because I get to play and I can actually ‘give’ or ‘sell’ my item over to someone else that finds use for it. But to me, most of crypto is pointless right now. I still feel that way. I say ‘most’ and not all.”

And while it “would be nice” to see his holdings return to their former glory, he said, “I still have a lot more money in my pocket now.”

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