Normally after a day like yesterday, we at FullyCrypto would write a report on the facts of what turned out to be one of the most brutal, hair-raising drops in Bitcoin’s history. And we will still do that. But we know that behind the statistics of losses and liquidations are real people with very real emotions, and when even the most experienced traders on Twitter are sounding like they’ve just come off the world’s most terrifying rollercoaster, it’s pretty clear that almost everyone will be hurting in some way. So here’s my personal take on how yesterday made me feel, so you know you’re not alone. I hope you find it useful in some way.
Sucker Punch
Events like yesterday are a chastening experience, even for those who have been through it before, as I have. I saw my wealth evaporate in 2018 when I held from the very top to the near bottom, selling when it was far too late. I also remember watching what little I had left evaporate when Bitcoin crashed 50% in November 2018. I was new to such crashes then, and all I felt was the sucker punch that came with realizing that something like this could happen having been conditioned to ‘up only’ for nine months.
As I watched Bitcoin cutting through levels of support like they weren’t even there yesterday, I was less worried for my portfolio than I was annoyed that I had allowed myself to be in a position to be affected by it in the first place. I found myself angry that I didn’t appreciate the signs of the top, even though I wrote about them just a few weeks ago. Coinbase number 1 app? Check. Family and friends asking if they should buy DOGE? Check. Making plans for the millions I was undoubtedly going to make? Check. And yet I ignored them. Was it greed? It didn’t feel like greed, it felt like a normal reaction to a typical Bitcoin bull run dip, like selling at that point was the antithesis of what I’d taught myself, and been writing about.
Mental Shift Was Hard to Manage
The hardest thing for me personally yesterday was the shift in mindset that I was forced through in that hour – mentally it was like being put through a mangle. Just last night I was setting optimistic targets for my alts, hoping to accumulate more bitcoin in time for a Bitcoin run later in the year, with one eye on a cashing out point in early 2022. And then just a few hours later I’m watching those dreams going up in smoke along with my confidence in the market.
I don’t margin trade so I wasn’t one of the near 400,000 people who got liquidated, therefore I’m lucky I still have funds to use. I didn’t sell a bean, which at $65,000 was a bad move but at $30,000 will probably turn out to be a wise move. Experiencing something like yesterday almost feels like a violation of your soul, even if financially you’re not overly impacted. Unless you were one of the infinitesimally small number of people who predicted this drop and were waiting for it, sitting on the sidelines and just watching it go lower and lower leaves you with nothing but a feeling of powerlessness – there is nothing you can do except hope, with every bout of hope getting savagely crushed one by one.
The most harrowing part about yesterday was where Bitcoin bottomed out (at least for now). $30,000 was the last line of defense against a bear market that I, for one, was utterly mentally unprepared for. Had Bitcoin dropped significantly beneath that line I would have been in the position of having to decide between figuratively holding down to zero and potentially wiping out my entire portfolio or panic selling everything in the hope of rescuing some funds, having held all the way down. Thankfully $30,000 proved a strong enough defense (for now) and that decision was taken out of my hands.
Yesterday’s crash felt like receiving a gut punch at the same time as a kind of calm numbness. In no other sphere of life can you feel something like that, and experience only helps so far – one look at crypto Twitter was enough to see that the overriding emotion was shock.
Where Next for Crypto?
The most pressing question is what to do from here. Having not sold and not been able to buy, I have bags of alts currently between 25-60% down. This has led to the next stage of concern – what do I do with them in order to protect the capital I have left? This leads to a further question of whether I think the bull run is over or not. Much of this depends on how the Bitcoin price reacts in the coming days, which leaves a vacuum that I, and many others I am sure, are filling with doubt and concern.
There are good arguments on both sides, leaving me in the position of, ironically, fear, uncertainty, and doubt. I don’t want to buy into the hopium and look back and kick myself for holding my coins when it was so obvious that the market had turned. On the flip side, I don’t want to panic sell here and watch everything recover, knowing I sold to the very people who manipulated the price down in the first place.
Things will become clearer in the next few days, and already, just a few hours after the event, the initial feelings of shock have subsided. I am however exhausted and left with anxiety about how to handle what comes next. And in that, I know I am definitely not the only one. There will be thousands of people out there feeling the same, and worse for those who got liquidated. If this is your first experience of such a drop, it is brutal, there’s no denying it, and it hurts seeing the wealth you have accumulated over months evaporate in one killer red candle.
You (and Your Portfolio) Will Recover
I felt much worse than this in 2018 when I realised that my portfolio wasn’t coming back, at least not any time soon. It took me three and a half years to get half of it back, which yesterday’s crash has now demolished, but that experience has given me faith that, whatever happens from here, I will make it back again.
The worst case scenario is that I sell here and start the next bull market with a healthy position and more experience. The best case scenario is that this was just the mother of all dips and we continue onwards and upwards.
Events like yesterday hurt; they leave you feeling utterly shellshocked, but they are a part of a market that can make you poor just as much as they can make you rich. It may not be healthy, but no matter how much crypto abuses you you will always end up going right back.
No one predicted such an extreme crash today, and everyone can take lessons from it, me included. So get some sleep, dust yourself off, take some notes, learn some lessons, and plan your re-entry.
