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In bear markets, retail traders often suffer a significant loss because they are unable to handle an 80 to 90 percent drop in value and are forced into a position to liquidate their holdings. Billionaire investors and large-scale institutions, in contrast, have the luxury to hold and sustain their portfolios.
Perhaps a bigger factor that has high net worth individuals remaining relatively positive on the long-term growth of the cryptocurrency market is the historical performance of Bitcoin.
Throughout the past nine years, Bitcoin has suffered five bubble-crash-build-rally cycles wherein the dominant cryptocurrency dropped by about 85 percent on average and recovered to a new all-time high.
From $19,500, Bitcoin has dropped about 82 percent in value and the 85 percent point would be at around $2,950.
On Wall Street, most of the high profile investors that are currently involved in the cryptocurrency market have gone through many cycles like the bubble-crash-build-rally pattern of cryptocurrencies, and for a big portion of those investors, such cycles do not come across as untypical.
Perhaps a bigger factor that has high net worth individuals remaining relatively positive on the long-term growth of the cryptocurrency market is the historical performance of Bitcoin.
Throughout the past nine years, Bitcoin has suffered five bubble-crash-build-rally cycles wherein the dominant cryptocurrency dropped by about 85 percent on average and recovered to a new all-time high.
From $19,500, Bitcoin has dropped about 82 percent in value and the 85 percent point would be at around $2,950.
On Wall Street, most of the high profile investors that are currently involved in the cryptocurrency market have gone through many cycles like the bubble-crash-build-rally pattern of cryptocurrencies, and for a big portion of those investors, such cycles do not come across as untypical.
This is why people shouldn't be stressed about the bear market.
Bitcoin isn't some magical investment that will continue to appreciate in value.
Just like any other asset, it will have its bull markets and bear markets in the short run, and right now we are in the latter. If you do think that long term demand for bitcoin will increase (i.e., more people will start using bitcoin to pay in the future, or at least store their wealth), then these short term price swings shouldn't worry you at all.
As OP said, we see that on average, bear markets take around 1-2 years to recover. I think we are close to the bottom right now, and that it is a good idea to accumulate some coins through dollar cost averaging to enter the market at a low price.
