Original Link:《Crashes, Manias and Panic's 》
Compiled by: Ken, Chaincatcher
The outside world feels incredibly brutal and hopeless. It's all over, you missed the opportunity, you messed up again.
Everyone feels angry and confused. Even those who foresaw this feel relieved but also understand how much this price action has hurt others. It feels like the worst moment.
I've been in the markets for 38 years (today's sell-off was a nice birthday gift, plus my food poisoning last night!), I've seen all kinds of crashes and panics.
They all feel the same. Terrible.
I got involved in cryptocurrency in 2013. I bought Bitcoin for the first time at $200 back then.
After buying, it went up a bit, then crashed 75%... and this was during a bull market that eventually went more than 10 times 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 fell 87%.
The subsequent bull market lasted until 2017, during which I experienced three 35% to 45% sell-offs... It was brutal. I eventually sold at $2000 (the previous 2013 high) because of the Bitcoin fork war.
I made 10 times from my initial entry point. But before another huge, ugly bear market started, it went up another 10 times (!!) by the end of that year.
I avoided that entire bear market and felt pretty good.
I bought back in at $6500 during the COVID crash (3.5 times higher than where I sold). This was a costly mistake, even though I thought I was doing the "right thing" at the time.
<极 style="font-size: inherit; font-family: PingFang SC,Helvetica Neue,Helvetica,Arial,Hiragino Sans GB,Heiti SC,Microsoft YaHei极,WenQuanYi Micro Hei,sans-serif;">In 2021, Bitcoin fell 50% from April to July, and the market conditions were very similar to now. The sentiment on Twitter was terrible. Really bad. But the market wasn't actually as oversold then as it is today...
By November 2021, the market was back at all-time highs. Solana rallied 13x from the lows. Ethereum doubled. Bitcoin hit new highs, up 150%.
I lived through all of it. Every terrible, gut-wrenching moment happened within a long-term structural bull market.
My first entry was at $200. The price now is $65,000. And in between, I missed out on a 3.5x gain by trying to time it (very poorly).
The first key lesson here (for me) is that in a long-term appreciating asset, all you have to do is nothing. HODL became a meme for a good reason. It's much stronger than the 4-year cycle meme.
My second lesson is to aggressively add to positions during sell-offs. Even if the timing is off, buying in tranches during weakness to increase the overall position compounds returns immensely over time, even better than dollar-cost averaging.
I don't always have cash to buy heavily in sell-offs, but I always buy a little because it's good for mental training.
You always feel like you've missed it, it's never coming back, everything is彻底 over. It's not.
Ask yourself two questions:
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Will tomorrow be more digital than today?
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Will fiat currency be more debased than today?
If the answer is yes, then keep going. Buy the dip, let 'time in the market' beat 'timing the market,' because it always does. Adding during massive sell-offs lowers your average cost. This makes a huge difference.
Stress, fear, and self-doubt are expected 'taxes' along the way.
Position sizing is important for your 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 comfort zone.
Another key point is not to blindly believe others' opinions. Doing your own research is a very important principle. Without it, you can't get through these tough times.
Earn your conviction through strength. Renting conviction is like leverage; it will eventually leave you with nothing.
Remember—when you're busy blaming others, you're really just blaming yourself.
Yes, it feels dark out there. The sun will rise again soon; this is just another scar on the journey (as long as you don't use leverage! Leverage leads to permanent loss of capital because you lose your bet to the casino). Never lose your principal.
When will this all be over? I don't know, but I think it's more like April to November 2021—a panic within a bull market. I think it will end soon. If I'm wrong, I won't change anything. As long as I have cash, I will keep adding.
But for you, it might be different. Try to build a regret-minimizing portfolio. Can you afford another 50% drop from here? If not, reduce your position, even if it feels stupid. Having the right mindset is crucial for survival. And my mindset has turned to 'how can I buy more,' even if your thoughts might be the opposite.
There will always be some market timers who accurately predict the timing of the sell-off, closing positions or shorting. This will always exist. But honestly, you just need to tell yourself that this is to be expected at any time. That way, when it actually does happen, you won't feel stressed because you expected it! It becomes part of the story, not the whole story.
What am I doing now?
I'm also starting to buy some digital artwork (which is also a way to accumulate Ethereum), and next week I will look to add more crypto exposure, as I have done every time this opportunity arises.
I bought the COVID sell-off, the 2021 sell-off, the 2022 sell-off, the 2023 sell-off, and 2024 and 2025 too! I'll do it again this time. Every time my P&L makes new highs before the market does. This trick works like magic. Once again... buy the dip!
Good luck, everyone. The road is never easy.
Volatility is the price we pay for owning these kinds of long-term compound return assets. Accept it.
