Author: Raoul Pal
Compiled by: Deep Tide TechFlow
Original link:
https://x.com/RaoulGMI/status/2019541941663285274
Deep Tide Guide: In the face of recent sharp volatility in the crypto market, a veteran with 38 years of market experience and 13 years deep in the crypto space shares his journey. He has witnessed Bitcoin's spectacular rise from $200 to $75,000, and has also countless dark moments of 50% or even 80% drawdowns in net worth. Through this article, he conveys a core idea to those investors feeling despair and anger: in a long-term Secular Bull Market, volatility is the necessary 'entry tax,' and true wealth often belongs to those 'fools' who can overcome human instinct, firmly accumulate during panic, and hold for the long term.
The market feels brutal right now, seemingly hopeless. It's all over. You missed the opportunity. You screwed up again.
Everyone is full of anger and confusion. Those who foresaw this situation might feel smug, but many can also see how deeply such price movements hurt people. It feels like the worst of times.
I've been in the markets for 38 years now (today's selloff is a nice birthday present, coinciding perfectly with my food poisoning last night!), and I've seen all types of crashes and panics.
They all feel the same: F*cking awful.
I got into crypto in 2013. That's when I first bought BTC at $200.
It rallied a bit after I bought, then fell -75%...... and this happened *during* a bull market, a bull market that ultimately went 10x+ from my entry price. I didn't sell because it was a long-term investment, and I knew the risks well.
Then, in the 2014 bear market, it crashed another -87%.
During the subsequent 2017 bull run, I suffered three sharp sell-offs between -35% and -45%...... brutal. Due to the Bitcoin fork war at the time, I ultimately exited at $2,000 (the previous 2013 high).
My original investment was up 10x by then. However, by the end of that year, it went up another 10x (!!), before embarking on another long, ugly bear market.
I successfully avoided that entire bear market. Felt great.
But I made a costly mistake: trying to do the 'right thing' (buy the dip), I bought back in during the 2020 Covid crash at $6,500—that's 3.5x higher than my sell price.
In 2021, BTC also experienced a -50% drop from April to July, and market sentiment was very similar to now. The atmosphere on Twitter (X) was terrible then. Really bad. But the market wasn't even as oversold then as it is today......
By November 2021, the market was back at all-time highs. SOL was up 13x from the lows, ETH doubled, BTC made new highs, up 150%.
I lived through it all. Every heartbreaking, gut-wrenching moment, all within a major secular bull market.
My first buy was at $200. The price now is $65,000. And I even missed a 3.5x move by trying to time it (and timing it poorly).
Key Lesson 1: (For me) For a secularly rising asset, the best action is inaction. HODL became a meme for a profound reason. It's far more powerful than the so-called '4-year cycle'.
Lesson 2: Aggressively add during sell-offs. Even if I don't nail the exact bottom, increasing the overall position by averaging into weakness over time creates massive compounding effects, even more effective than Dollar-Cost Averaging (DCA).
I don't always have enough cash to buy big in every sell-off, but I always buy a little because it helps train your psychology.
At times like this, you always feel like you missed it, that the bull run will never return, that it's all over forever. It's not true.
Ask yourself two questions:
- Will tomorrow be more digital than today?
- Will fiat currency be worth less in the future than it is today?
If the answer to both is yes, then carry on. BTFD (Buy The F*cking Dip), let 'time in the market' beat 'timing the market' because it always does. Adding during sharp sell-offs lowers your cost basis from the highs, which makes a huge difference.
Stress, fear, and self-doubt are all 'taxes' you should expect to pay on this journey.
Position sizing is crucial to your personal risk tolerance. Don't worry, everyone feels overexposed on the way down and underexposed on the way up. You just need to manage those emotions and find your balance.
Another key thing: Don't 'rent' someone else's conviction. DYOR (Do Your Own Research) is a very important creed. You can't get through these times without it. Earn your conviction yourself. Rented conviction is like leverage; it will blow you up eventually.
Remember—when you are busy blaming others, you are really just blaming yourself.
Yes, it feels dark out there right now. But the sun will rise again soon, and this is just another scar on your journey (as long as you don't use leverage! Leverage causes permanent capital loss because you lose your casino chips). Never lose your chips.
When will this all be over? I don't know, but I think it's more like the April to November 2021 situation—a panic within a bull market. I think it ends soon. If I'm wrong, I won't change my approach; I'll just keep adding when I have cash.
But for you, it might be different. Try to build a 'minimum regret portfolio'. Can you handle another 50% drop from here? If not, then reduce your position, even if it feels stupid to do so now. Having the right mindset is key to survival. My mindset has shifted to 'how can I buy more,' while yours might be the opposite.
There will always be some great market timers who perfectly avoid the sell-off or go short. There will be. But honestly, you just need to tell yourself that this volatility was expected at some point. When you expect volatility, you don't stress when it happens! It becomes part of the story, not the whole story.
I'm starting to buy more digital art (which also adds to my ETH position) and plan to add to my crypto allocation next week, just like I have done every single time an opportunity has presented itself.
I bought during the Covid sell-off, during the 2021, 2022, 2023, 2024, and will in 2025 sell-offs! I'll do it again this time. Every single time, my P&L makes new highs before the market does. It works like magic. Say it again......BTFD (Buy The F*cking Dip)!
Good luck, everyone. It's never easy.
Volatility is the price we pay for this long-term compounding return asset. Embrace it.
