I recently suffered a big loss in altcoins and decided to share my blood, sweat, and tears lessons.

Some time ago, I allocated a bunch of small-cap coins, but the recent market pullback woke me up. I realized a painful truth — even if you correctly predict the downward trend of altcoins, using the safest 1x leverage and a 2% position size to short, you can still face terrifying drawdowns or even liquidation. This is not an alarmist statement.

What’s even more heartbreaking? Transaction fees. Take PIPPIN and FHE tokens as examples. I only invested $20 USD in each to short, but the daily fees felt like invisible vampires, and in the end, I lost $200 USD. You read that right — a single $20 trade was eaten away by fees to the point of losing $200 USD.

So now I understand — whether shorting or longing altcoins, trading costs alone can drain you to liquidation. No matter how strict your risk management is, it can’t prevent this invisible cost trap.