There comes a point in time in many Web3 investors’ minds when they just want to sell all their digital assets and leave the space forever, even if it means solidifying monumental losses. Needless to say, this sentiment usually hits hardest when the bear market is prolonged, as is the case during “crypto winters”.
Of course, every single investor has a different and unique circumstance in life, and sometimes, complete capitulation is necessary and the absolutely correct thing to do — especially if there are more pressing matters that require financing in an investor’s real life. Few would judge a community member for “paperhanding” all their monkey JPEGs if it is to pay for an operation that could save their child’s life, for instance.
However, for those that can afford it, it is best to avoid complete capitulation. It’s certainly still worth capitulating a large chunk of your portfolio if you’ve personally lost all hope in Web3, but try to hold the remainder — until, at least, the market gets better. Viewing these remaining assets as sunk costs could help to a degree.
Why is this recommended?
Because, simply, an investor will never know pain like missing out on a bull run precisely because they’ve sold everything prior to that run at a loss. The deep horror and regret that sinks in when they watch helplessly as prices fly way past even their original buy-ins is not pleasant in the slightest.
Here’s a thought: if every single person that invested in Bitcoin prior to the last crypto winter (tail end of the last decade) held all their Bitcoin and did not capitulate until now despite the big, prolonged crash in between, then all of them, without exception, should be in massive profit right now. For many, the only reason they aren’t in profit now is that they’ve chosen to capitulate when they were at a loss. While capitulating some but not all assets may mean that there is still a net loss when the bull market returns, it’s certainly not as bad as if there was full capitulation at the bottom.
On top of merely recuperating losses, continuing to hold assets can still yield benefits such as continued membership to exclusive communities and passive income.
It’s not all bad.
Every investment strategy comes with risks, and investors should carefully consider their financial situation, risk tolerance, and investment goals before making any decisions. However, by adopting a “never fully capitulate” approach, investors in Web3 can potentially benefit from long-term growth opportunities while avoiding the negative consequences of market volatility.
Written by: Jpegtologist
