For those of you who are new to Bitcoin and crypto, welcome to your first bear market. These are the times in the market where the mood can become suffocating, and make you begin to question what you ever saw in the market. Perhaps all of those crypto naysayers were correct, and those of us in crypto were the ones who were wrong. Just take the advice from those who have been through several of these cycles before. While each one has different characteristics, they are all quite similar. With an emphasis on the emotional state that a person goes through during this period. We are now in a game of survival, where you have been able to hold onto your crypto up until this point. You have already won half the battle. There is a reason why OG's in the space often state that you aren't a true Bitcoiner, or haven't truly experienced the cryptocurrency markets until you have gone through a full bull and bear cycle. While times are currently bearish. When things are the most bearish, that is when the opportunity to change your life is at its greatest.
But, before we move onto my bullish spin on this entire situation, we need to evaluate this current bearish situation even more. Why does this drop in crypto prices feel more surprising than in past cycles? There are many reasons for this, but if I had to say my opinion on it, I would say that this was the cycle of undelivered promises. We were fed predictions and promises of Bitcoin potentially reaching prices of $200k or even beyond. We were told tales of how prices would go parabolic, and there would be a blow-off-the-top moment for the price that would signal the bull cycle coming to an end. We had accepted the fact that it would be likely that Bitcoin would again see a 70%+ drop in price. But we were imagining that would be accounting for a new all-time high being set at around $200k. Meaning that the price would crash to somewhere around $40k. But those highs never came, the market didn't have a blow-off-the-top moment, and we reached $69k. And then the price would drop down to $17k. That is when one of Bitcoin's largest sacred cow theories had finally been broken. That precious cycle's all-time highs would never dip below again. Up until this week in Bitcoin's history, that theory had held true, but the unthinkable has happened.
So what went wrong?
I'm of the firm belief that this cycle was on the verge of performing like past cycles. That Bitcoin was going to reach those incredible price points, that the price would go parabolic, and that there would be a giant blow-off-the-top moment. But, the bull cycle got interrupted. It got interrupted by a black swan event that prevented Bitcoin from doing what we thought was going to happen. Not only was it interrupted by a black swan event, but I would argue that it was actually interrupted by several black swan events. And that is what ended the bull run quicker than planned, and that is what sent the price lower than any of us ever expected. Dealing with the Pandemic, out-of-control inflation, the ban of bitcoin in China, FED interest rates, the Ukraine and Russia war, the Luna/ UST collapse, the insolvency of Celsius, and also the fall of 3AC. If you analyze all of these situations, I think it is still incredibly bullish that the price of Bitcoin is still sitting around the $20k mark. Still far above the lows of $3k, where it had fallen when the whole pandemic situation began.
So what should we do?
As I mentioned above, with Bitcoin's price falling below the last cycle ATH, that changes everything. All theories and what we thought we knew, can be thrown out the window. While I think most of us would agree that we are definitely in the bear market now. There is no guarantee of how long this will last. The market could perform similarly to past cycles, meaning that the bear market could last for 1-2 years. But, because everything has changed, it could change much faster than that. One change of strategy by the US FED or some other catalyst coming into play is all we need for the entire mood in the crypto market to change.
This is how I'm handling the situation.
While I fully realize that I could have been attempting to catch a falling knife by accumulating more Bitcoin. Meaning that prices could keep dropping even after I buy. But, I believe that for those of us who want to accumulate more Bitcoin. We have been given an extremely rare opportunity. And so, I have been going all in on buying more Bitcoin, and also accumulating more Ethereum as well. Always remember to not invest any more into crypto than you are willing to lose. However, if you have a long-term time horizon. We will look back on this period as potentially the last great chance to accumulate more Bitcoin cheaply.
The question that everyone wants to know is how will bitcoin perform over the rest of the year. Myself included. I'll be honest, I have no idea what's going to happen. Anyone who tells you they do most likely have anterior motives. It all depends on what happens with the world macro. With that said, I strongly believe that Bitcoin will end the year higher than it is now.
How about you? What's your strategy? Are you currently accumulating more Bitcoin and other crypto? Or are you taking the wait-and-see approach?
As always, thank you for reading!
