Frenzy, Panic, and Collapse: Navigating 38 Years of Bulls and Bears, Volatility Is the Path to Wealth

In a long-term secular bull market, volatility is the “entry tax” that must be paid, and true wealth often belongs to those who can overcome human instincts, confidently accumulate during panic, and hold for the long term—the “fools.”

Author: Raoul Pal

Translation: Deep潮 TechFlow

Original link:

Deep潮 Guide: Facing recent sharp fluctuations in the crypto market, a veteran with 38 years of market experience and 13 years of deep involvement in crypto shares his journey. He has witnessed the grandeur of Bitcoin rising from $200 to $75,000, and has experienced countless dark moments with net value retracements of 50% or even 80%. Through this article, he conveys a core idea to investors feeling despair and anger: in a long-term secular bull market, volatility is the “entry tax,” and true wealth often belongs to those who can overcome human instincts, confidently accumulate during panic, and hold for the long term—the “fools.”

The current market feels very brutal, seemingly hopeless. Everything is over. You missed the opportunity. You messed up again.

Everyone is full of anger and confusion. Those who foresaw this situation might feel relieved, but many also see how deep the damage such price swings can cause. It feels like the worst times.

I’ve been in the market for 38 years (today’s sell-off is a pretty good birthday gift, just in time for my food poisoning last night!), and I’ve seen all kinds of crashes and panics.

They all feel the same: Damn, this is terrible.

I started getting into crypto in 2013. That was when I first bought BTC at $200.

After buying in, it rebounded for a while, then dropped -75%… and this happened during a bull market, which eventually soared more than 10 times my entry price. I didn’t sell because it was a long-term investment, and I understood the risks.

Then, during the 2014 bear market, it plunged another -87%.

In the 2017 bull market that followed, I experienced three severe sell-offs ranging from -35% to -45%… very brutal. Due to the Bitcoin fork wars at the time, I ultimately exited at $2,000 (the previous high in 2013).

At that point, my original investment had already multiplied 10 times. However, by the end of that year, it had risen another 10 times (!!), and then another long, ugly bear market began.

I successfully avoided that entire bear market, and it felt fantastic.

But I made a costly mistake: in an effort to “do the right thing” (bottom-fishing), I re-entered at $6,500 during the COVID-19 crash in 2020—3.5 times higher than my previous sale price.

In 2021, BTC also experienced a -50% drop from April to July, with market sentiment very similar to now. The atmosphere on Twitter was extremely bad. Really bad. But back then, the oversold condition wasn’t as severe as today…

By November 2021, the market returned to all-time highs. SOL rebounded 13 times from its lows, ETH doubled, and BTC hit new highs, bouncing 150%.

I witnessed all of this. Every heartbreaking, gut-wrenching moment happened within a major secular bull market.

My first buy-in was at $200. Now, the price is $65,000. In between, I even missed a 3.5x rally trying to time the market (terribly).

The first key lesson: (for me) the best approach for a secular rising asset is “doing nothing.” HODL (holding long-term) has become a meme for a deep reason—it’s much stronger than the so-called “four-year cycle” theory.

The second lesson: aggressively add to your position during sell-offs. Even if I couldn’t precisely bottom-fish, averaging into weakness by scaling in during downturns can significantly increase your total holdings over time, producing a compounding effect that’s even more effective than dollar-cost averaging (DCA).

I don’t always have enough cash to buy heavily during every sell-off, but I always buy a little, because it helps train your mental resilience.

In these moments, you’ll always feel like you missed the opportunity, that the bull market will never return, and everything is doomed forever. That’s not true.

Ask yourself two questions:

1. Will tomorrow be more digital than today?
2. Will the future value of fiat currency be lower than today?

If both answers are yes, then keep going. Buy the dip (BTFD), letting “time in the market” beat “timing the market,” because the former always wins. Increasing your position during sharp sell-offs reduces your high-cost basis, making a huge difference.

On this journey, stress, fear, and self-doubt are the “taxes” you should expect.

Position size is crucial to your risk tolerance. Don’t worry—everyone feels their position is too heavy during a dip, and not enough during a rally. Just manage these emotions and find your balance.

Another key point: Don’t “rent” someone else’s conviction. DYOR (do your own research) is a vital principle. Without it, you can’t get through these tough times. Rely on your own conviction. Rented conviction is like leverage—it can blow you up at any moment.

Remember—when you’re busy blaming others, you’re actually blaming yourself.

Yes, the outside world feels very dark right now. But the sun will rise again soon; this is just another scar in your journey (as long as you don’t use leverage! Leverage can lead to permanent capital loss because you’ll lose your chips in the casino). Never lose your chips.

When will all this pass? I don’t know, but I think it’s more like the situation from April to November 2021—a panic within a bull market. I believe it will end soon. If I’m wrong, I won’t change my approach; I’ll just keep adding when I have cash.

But your situation might be different. Try to build a “minimal regret portfolio.” Can you withstand a 50% drop from here? If not, reduce your position—even if it feels stupid now. Having the right mindset is key to survival. My mindset has shifted to “how to buy more,” while yours might be the opposite.

There will always be some timing experts who can precisely avoid sell-offs or short. There are indeed such people. But honestly, you just need to tell yourself that these fluctuations are always within expectations. When you anticipate volatility, you won’t feel the pressure when it happens! It becomes part of the story, not the whole story.

I’m now starting to buy more digital art (which also increases my ETH holdings), and plan to increase my crypto allocation next week, just as I’ve done every time an opportunity arose.

I bought during the COVID sell-off, and I’ve bought in every sell-off in 2021, 2022, 2023, 2024, and 2025! I will do the same this time. Every time, my P&L hits new highs ahead of the market. It’s like magic. One more time… BTFD!

Good luck to everyone. It’s never easy.

Volatility is the price we pay for this long-term compound asset. Embrace it.