On Bear Markets



via messari

“One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always run to simplicity.”

-Bruce Lee

I’ve always believed in addition by subtraction.

Whether it’s in my writing, my waistline, or my day-to-day responsibilities, adding bloat is (almost) always a net negative.

Crypto companies and projects by and large got too fat and happy during the 2017 run-up, and didn’t think about what would happen when the music stopped.

So now, whether there is a “relief rally” or we continue to bleed downwards for a bit, I believe two things: 1) fundamentally sound cryptoassets will resurge in a massive way, and there will be another bull market that dwarfs the last, 2) that could take a while, and in the meantime, we’re going to feel the aftermath of this hangover for a while.

I rather liked Fred Wilson’s look back on the internet bear market this weekend and lessons it can provide for crypto peeps, even if it scared the shit out of me.

“[F]or those of us who were investing in tech and tech startups back in 1999-2002, that time will forever be etched in our minds. It was a brutal period during which our belief in the Internet and its potential was sorely tested. Many friends and colleagues left the sector and never returned.”

Consistent messaging is coming from many investors and early adopters in crypto right now - folks who have lived through multiple bull-bear cycles: cut fat, and prepare for winter…because it’s already here.

Another of our investors put the crypto markets in context this weekend, and I agree:

“At this point everyone is guilty until proven innocent. The sentiment has shifted from euphoric and forgiving to depressed and unforgiving.”

You can fight that reality, or you can hunker down for the next battle. Learn to “embrace the struggle.”

Or as Fred wrote in his post:

“[Look] for signs of life. There were little internet projects that turned into big ones. Blogger was started in late 1999, almost shut down many times in the next few years, and was picked up by Google in 2003. Myspace, LinkedIn, and Facebook all emerged in the 2002-2004 period, as the Internet was finally coming to life again.”

For those of you who leave, we wish you the best. We’ll be here waiting to welcome you back as the market recovers.