Author: Raoul Pal, Founder of Real Vision
Compiled by: Luffy, Foresight News
The current market is bleak, with no hope in sight. It feels like it's all over. You've missed your chance and messed up once again.
Everyone is engulfed in anger and confusion. Even those who predicted this decline, while feeling a hint of self-satisfaction for being right, also recognize the heavy blow this market has dealt to countless people. Right now, it feels like the darkest hour.
I have been in the trading market for 38 years and have seen all kinds of crashes and market panics. The feeling is always the same each time: utterly terrible.
I entered the crypto market in 2013, buying Bitcoin for the first time at $200.
After buying, Bitcoin briefly rose and then plummeted by 75%. And this was during a bull market; the price eventually soared to more than 10 times my purchase price. I didn't sell because it was a long-term investment, and I was aware of the risks.
By the 2014 bear market, Bitcoin had crashed another 87%.
In the subsequent bull market that lasted until 2017, I experienced three brutal crashes of 35% to 45%. Ultimately, due to the Bitcoin fork debate, I sold out at $2,000, which was also the previous high from 2013.
By then, my holdings were 10 times their initial entry price. And after I sold, Bitcoin multiplied another 10 times by the end of that year—unbelievable! This was followed by another long and brutal bear market.
I perfectly avoided that entire bear market and was quite pleased with myself at the time.
Then, during the market crash triggered by the COVID-19 pandemic, I bought Bitcoin again at $6,500, a price 3.5 times higher than when I had sold. What I thought was the "right move" turned out to be a costly mistake.
From April to July 2021, Bitcoin plunged 50%. The market sentiment on Twitter at that time was just as bad as it is now, truly awful. But even then, the market was not as oversold as it is today.
By November 2021, the market had returned to its all-time high: SOL surged 13 times from its low, Ethereum doubled, and Bitcoin hit a new high, rising 150%.
I have experienced all of this firsthand. I have been present for every heart-stopping, gut-wrenching moment in this long-term bull market.
My initial entry price was $200, and now Bitcoin is at $65,000. Even though I missed out on a 3.5x gain due to poor timing along the way, the final returns are still substantial.
For me, the first core lesson in a long-term bull asset is to do nothing. It's no accident that "HODL" has become a classic creed in the crypto world. Its power far surpasses the "four-year cycle" narrative.
The second lesson is to boldly add to your position when the market crashes. Even if the timing isn't perfect, buying in batches during market weakness and increasing your holdings can lead to compounded growth over the long term, even outperforming dollar-cost averaging.
I don't always have enough funds to make large purchases at the bottom, but I always buy some because it helps temper my mindset.
During market crashes, people always feel like they've missed their last chance, that the market will never recover, that everything will completely collapse and never bounce back. But that's never the case.
Ask yourself two questions: Will the world be more digital tomorrow than it is today? Will fiat currency be worth less than it is today?
If the answer to both is yes, then keep holding on. Buy the dip boldly, and let the power of time overcome timing, because the former always wins. Adding to your position during sharp declines lowers your average cost basis, and that makes a world of difference.
On this investment journey, stress, fear, and self-doubt are unavoidable costs.
Manage your position size according to your risk tolerance. Don't be anxious; everyone feels this way: during downturns, you think your position is too heavy; during upturns, you regret it being too light. What you need to do is learn to regulate these emotions and find a rhythm that suits you.
Another key point is not to blindly follow others' judgments. "DYOR (Do Your Own Research)" is also golden advice in the crypto world. Without independent judgment, you simply cannot survive these darkest hours.
Develop your own firm convictions. Blindly following others' opinions is like adding leverage—it will eventually make you lose everything.
Remember: When you're busy blaming others, you are essentially blaming yourself.
Admittedly, the market is dark right now, but the sun will shine again soon, and this crash will eventually become just another scar on your investment journey. That is, provided you didn't use leverage! Leverage will make you lose your principal entirely, like losing all your chips in a casino. Never lose your chips.
When will this gloom lift? I don't know, but I think this is more like the period from April to November 2021: a panic sell-off within a bull market, and I believe it will end soon. Even if my judgment is wrong, I won't change my strategy. As long as I have cash, I will continue to add to my position.
But for you, the situation might be different. Consider building a "no-regret portfolio": Can you withstand another 50% drop from the current price? If not, then reduce your position, even if doing so right now feels foolish. Having the right mindset is key to surviving the market winter. My mindset is how can I buy more, while yours might be the opposite.
There will always be timing experts in the market who can accurately exit at the top and even go short. There will always be such people in the future. But honestly, you just need to constantly remind yourself that a crash can happen at any time. When it does come, you won't be anxious because you expected it. Let the crash be part of your investment story, not the whole story.
What am I doing now?
I'm starting to buy more digital art (which is also equivalent to increasing my Ethereum holdings) and plan to add more crypto assets next week, just as I have done every time such buying opportunities arose.
I bought the dip during the COVID crash, I bought the dip in 2021, again in 2022, and in 2023, and I will still buy the dip in 2024 and 2025! This time, I'll do the same. Every time, my account's profit and loss hit new highs before the market does. This method works every time. Let me say it again: Buy the dip boldly!
Good luck to everyone. The path of investment is never easy.
To hold these assets that can achieve long-term compound growth, you must accept their high volatility. This is the price we must pay. Learn to embrace the volatility.
