If you've been in the cryptocurrency world for a while, you know that volatility is not an occasional guest... it's part of the DNA of this market. And yet, every time the price of Bitcoin or any other cryptocurrency drops sharply, many feel that this time will be different. That it's the end. That there's no turning back.
Believe me, I've been there too. I experienced it firsthand in 2017, after buying bitcoin (BTC), it was around $1,000. Shortly thereafter, it fell, and many thought it was the end, but it wasn't, and it isn't now either.
History always repeats itself (and that's an opportunity).
Financial markets are driven by emotions. Fear, greed, hope, panic. But behind that emotional rollercoaster, there is something that remains: opportunity.
In 2016, after a significant resignation in the Bitcoin development team, headlines proclaimed the end of cryptocurrency. The price fell, confidence wavered, and fear took over many. But those who held firm, those who researched beyond the noise, saw that the value of Bitcoin remained intact. What happened next? Bitcoin soared to over $20,000 in less than a year.
Today, we are facing a similar scenario. Bitcoin has corrected by 30% from its all-time high of nearly $110,000. And of course, many are asking: 'Is this the end of the bull market?'
My answer is clear: no. Not by a long shot.
Why do prices fall if the future is bright?
Markets, especially those of emerging assets like cryptocurrencies, do not rise in a straight line. Drops of 30%, 40%, or even 50% are normal in a long-term uptrend. It is the 'toll' paid for being in the right position before true exponential growth arrives.
In 2017, Ethereum had eleven drops greater than 30% before reaching its all-time highs. And yet, those investments offered life-changing returns: up to 27,000% in Ethereum, for example.
Corrections, although painful, are opportunities in disguise. Great investors know this. Most buy when there is fear, not when everyone is talking about it in the news.
Why not sell now and buy back cheaper?
This is a very valid question. And the answer is simple: no one can perfectly time the market. We don't have a crystal ball that tells us when the lowest point will be. Moreover, the market is so sensitive to news that any positive headline—a favorable regulatory announcement, the entry of large institutions, or a technological breakthrough—can spike prices in a matter of hours.
In these types of environments, the risk of being out of the market is much greater than the risk of holding open positions.
What can we expect in the coming months?
If Bitcoin falls below $78,000, it could be an attractive point for short- and long-term investors. If the price drops to that zone, it could be an excellent opportunity to accumulate more.
My strategy? Maintain a long-term position that I do not touch regardless of volatility, and have capital to operate in the short term, seeking to take advantage of the 20-30% movements we have seen time and again.
If you have followed this strategy, you know that just in the last six months, Bitcoin has offered multiple opportunities for double-digit profitability.
The price of opportunity is volatility.
There are no free lunches in the investment world. The price to access extraordinary returns is volatility. It's like getting angry at the rain because it gets you wet: it's part of the game.
That's why it's key to size your investments. Don't put in more than you can afford to lose. Invest small amounts systematically. If you have a portfolio of $1,000, distribute it equally among high-quality assets, and be patient.
In 2017, many gave up halfway because they were not emotionally prepared. But those who held on saw their investments multiply.
In summary, it's not the end; it's a new opportunity.
Today we face the same fears, the same doubts, and the same volatility we have seen in other cycles. But we are also presented with the same opportunity: to be part of the greatest financial revolution of our era.
So if volatility stresses you out, turn off the screen. Take a walk. Spend time with those you love. History shows that, in cycles like this, those who hold firm are the ones who see unimaginable rewards.
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