Jimmy Song, a core bitcoin developer: why the bear market is bad and why it is good

Jimmy Song, the core bit of the bitcoin developer, wrote on medium today (December 6th) on bitcoin bear market on medium.

The bear market in the bitcoin market has lasted for nearly a year, and it is a difficult situation. It is a difficult thing to hold assets when the assets fall, and it takes a lot of courage to get through it in this market.

In this article, I will make some suggestions to tell you how to seize the opportunity without being completely lost.

Why the bitcoin will fall

During the bear market, many people were in a panic. At first, the feeling of unease was not so strong, because most people thought that the fall was only temporary. But as the bear market continues to escalate, people are getting more and more uneasy.

The expectation of the special currency is that it will appreciate, and it should be stable. It is expected that bitcoin will continue to maintain the average profit of X% in the past 7 years, that is to say, they expect some kind of linear development.

Of course, nothing in the real world, including bitcoin, is linear. Things will develop quickly, which is perfectly normal. For example, bitcoin has gone through a number of more than 80% crashes.

The real reason for the bad heart lies in the speculative mentality of the people. If bitcoin is rising at a good rate of stability, it doesn’t have to make money through work. It’s a little far away. Let’s look at the bad of the bear market first.

Why the bear market is bad

First, financial pressure, especially the economic pressure that goes beyond your range, may ruin you. If you are overleveraged or not hedged, you will be squeezed out in a bear market. It’s bad to get out of the bear market.

The first rule of investment is not to be eliminated. Bear market is the place where this rule plays the most important role.

Second, social pressure. Not only financial pressure, each bear market has a critic that is similar to “I’ve told you”, and it’s worse when your relatives and friends say that. In a bull market, people think you are a genius, and when it comes to a bear market, everyone will laugh at you.

Third, the chances of making money are less. In the bull market, many different entrepreneurs and projects are looking for a variety of talents, and the chances of making money seem limitless. If you have a good record of performance, you can make a lot of money through consulting, advice, marketing, and so on. But in the bear market, things have become very difficult, and even capital rich projects are beginning to care about the budget.

Why the bear market is favorable

First, the bear market cleaned up the bad investment in the bull market. During the bull market, the project was too easy to raise money, and there was a project that raised more than $100 million in the white paper. In the past few years, the unjust investment in this field has nearly reached a level of madness. Many projects will disappear in the bear market, which is a good thing. Because the resources of these projects can be better used in more useful work. According to the Austria business cycle theory, the adjustment of the market will make companies and institutions better. In other words, it’s a very good thing to start with the money going to the people who really know what to do.

Second, the bear market exposes what is really important. Under the pressure of the bear market, only the truly useful can survive. Bear markets drive people to make choices, so we can find out what the market really needs. They no longer do any ICO, begin to look at what they see and make a more rational and prudent choice. They are no longer afraid to miss (FOMOing) and begin to do research (DYORing). It’s a good thing to have a smarter market, because better capital allocation can create a better society through wealth.

Moreover, the bear market teaches you to work hard. In a bull market, employment is easy and the expectation is very small. In a bear market, hiring more is out of need, and the boss is more demanding. This means that you have to provide real value and work hard, otherwise you will be laid off.

In addition, he can cultivate your character. Many people complain about how early users of bitcoin “luck”, long held people are not lucky, they have faith. Many people bought bitcoin In 2010-2011 years, but a lot of people sold it because they didn’t know much about the currency. They didn’t believe in bitcoin. They only thought it was a kind of toy. It was a gambling and trading thing, so it won’t be held for a long time. Will you continue to hold when a certain asset falls 80%? When the market is in a bull market, it is easy for you to say “yes”, but in a bear market it is different. After a bear market continues to hold the support of faith, you have to maintain no financial crisis, so you can’t squander the capital, you must carefully plan the future, and try to stick to your own values. The bull market provides space for you, and the bear market requires you to make some difficult choices. If you go through a bear market, your character can also be promoted.


A bear market is a necessary part of any economy, especially in the case of improper investment in the past few years. It is a major benefit to redistribute resources from what people do not want to be redistributed to the productive forces that people want. Over the past few years, there have been too many deviations in the field of encrypted money, which needs to be restructured according to its actual utility, not just at the level of commitment.

It’s not easy to finish this adjustment, but it will be worth it if you can get out of the plight, because you will make a profit in the next bull market.

(I am Odaily Daily reporter Mu Xinxin, explore the real block chain, burst, exchange, please add WeChat wsuixin12, please note the name, unit, job and cause.)

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