How to lose money in a bull market? Will Bitcoin really reach $150,000 in 2025?

Source: Talking About Li and Outside

In the previous articles of Talking About Li and Outside, it was mentioned that our personal expectation (speculation) for Bitcoin to reach a price of $100,000 to $120,000 in this cycle remains unchanged. However, with Trump's victory leading to a rapid breakthrough of Bitcoin's historical high, combined with some new positive measures he may take towards the crypto market and the Fed's continued expectation of interest rate cuts, we even believe that Bitcoin could potentially reach $150,000 next year (2025).

Even so, when Bitcoin officially broke through $100,000 on December 5, I still sold 10% of my position according to my original plan, as I strictly adhere to my trading discipline. As shown in the figure below.

Then, some friends left messages asking: I was just about to buy, and you started selling? Can I still buy Bitcoin now?

This question may need to be answered on a case-by-case basis.

As Hui said in the group yesterday: Don't directly ask me whether to buy or sell; that's not a decision others should make for you.

Or as Boss Heng said in the group yesterday: It depends on how you think. If this bull market rises to $150,000, the bear market falls to $50,000, and the next bull market rises to $250,000, as long as you are willing to ride the roller coaster, then holding is completely fine.

In fact, many people are unable to make trading decisions, which ultimately boils down to their confidence in the market (or the asset) and their own position management (including capital allocation, investment portfolio, goal setting, execution period, risk management, etc.).

In short, money can be made endlessly, but it can also be lost completely. If you want to lose money in a bull market, you just need to do the following:

- Lack of focus

In a bull market, many people forget their initial goals or trading discipline, and when they see a story that is trending, they rush to buy it, trying to seize every market opportunity. The result is often that they become someone else's exit liquidity.

- Not taking profits

Once in a bull market, many people are influenced by various messages, and many KOLs will tell you that the bull market has just begun, and all you need to do is buy the various tokens they recommend immediately. But we must learn to respect the market; bear markets do not have a bottom, and bull markets do not have a top. If you are fortunate enough to make money, then you need to take profits in batches according to your plan. Some investments can be liquidated to improve your life, while others can be kept for future growth.

- FOMO

Almost everyone knows they shouldn't fall into FOMO, but it always seems easier said than done. In a bull market, there are too many temptations constantly attracting people. One moment a certain project has surged several times, and the next moment someone next door has become rich again… Then you find it hard to resist chasing those so-called opportunities, but the outcome is often: when others buy, the price goes up; when you buy, the price goes down.

- Overtrading

In a bull market, many people, unable to resist temptation, inadvertently destroy their position management and investment portfolio, even trading thoughtlessly by mimicking others' actions. In reality, the more frequently you trade and the more complex your trading process, the harder it becomes to execute. In other words, overtrading can lead to diminishing returns, increased trading costs, increased slippage… and may also lead to the bad habit of revenge trading.

- Lack of patience

In this cycle, we started dollar-cost averaging Bitcoin in 2022, and only made one planned sell operation this month (December 2024), waiting for almost two and a half years. During this process, I rarely watched the market; I mostly checked it because I needed to write articles. Most of my time and energy were spent on writing and content output.

Many times, trading requires a certain level of patience, and trading often goes against human nature, as an impatient mindset can lead you to give up trading too early. Moreover, the more you obsess over prices every day, the easier it is to lose your position.

- Ignoring risks

For example, in trading, many people cannot resist temptation and reinvest profits that they had already taken to chase some altcoins, often ignoring the greater risks they may face.

Additionally, some people simply act hastily, adding random strangers as friends and following those so-called teachers, only to end up getting scammed. Remember, regardless of what stage the market has reached, risk should always be treated as a priority; otherwise, you may lose everything in a short period.

In short, if you want to lose money in a bull market, just do the above things, and it can be easily achieved. Conversely, if you want to make money in a bull market, you need to overcome those issues as much as possible.

Next, you can continue to think about a few questions:

In the past two years, many people believe that this bull market is likely to occur in 2024-2025, and Bitcoin is likely to rise to $100,000. So, let me ask you, in this cycle, Bitcoin has risen from around $15,000 to now $100,000, which is an increase of 550%. Have you made money now?

Although many people also believe that Bitcoin may continue to rise in 2025 and could reach $150,000, let me ask you, would you buy Bitcoin now?

If you buy Bitcoin now and the market experiences a pullback, can you hold on and not sell? Would you dare to add to your position during the pullback? Would you set a stop-loss plan? Or at what level of pullback would you consider stopping losses?

Do you really believe that Bitcoin will rise to $1 million in the future?

Perhaps many people have not carefully considered these simple questions, as they always hope to find a universal answer or a definitive conclusion from others. But as we mentioned in previous articles, any so-called prediction is merely probabilistic. What you should focus on is not finding a definitive answer from others, but rather how much you are willing to invest in certain probabilities.

Returning to the previous example, if there is a 90% probability that Bitcoin will rise to $150,000 in 2025, how much risk (how much capital to invest, what is the longest investment period) are you willing to take for this 90% probability?

Some may be willing to risk 10% of their wealth, while others may risk 100% of their wealth (even leveraging), and some may still believe Bitcoin is a scam and won't buy…

But if you believe BTC has a chance to reach $150,000 next year and you are willing to make some sacrifices and take corresponding risks, then you should start to understand Bitcoin and the market now, because only by understanding it yourself can you truly hold on.

In the previous article about Ethereum (December 6), we mentioned some factors affecting ETH prices, some of which are also applicable to BTC (and even the entire crypto market). Next, let's continue to analyze BTC from four dimensions: time, macro, demand, and on-chain data!

1. From the time dimension

From the current price trend of Bitcoin, it seems to still follow certain historical patterns, closely related to past cycles. If we directly compare the last two bull markets with this bull market, we can see some basic patterns. As shown in the figure below.

History does not repeat itself, but it often rhymes. If we were to carve the boat according to the comparison chart above, it seems that we are currently entering the most explosive price acceleration phase of the bull market cycle (the mid to late stage of the bull market).

Of course, we are only looking at historical cycles for comparison. If you want more references from the time dimension, you can consider looking at our article published last month (November 18) through Talking About Li and Outside: 15 Major Reference Indicators for Escaping the Bitcoin Bull Market.

2. From a macro perspective

The significant bull market in 2021 was largely influenced by changes in global liquidity due to the pandemic, and this bull market also shares some similarities in terms of liquidity. Bitcoin seems to have become a global macro asset; in addition to the four-year cycle and halving driving prices, the correlation between global liquidity (monetary easing policies) and Bitcoin prices is becoming stronger.

From the current Fed policy perspective, interest rate cuts are expected to continue until 2025, which will further create favorable macro conditions for risk assets (including crypto assets). As shown in the figure below.

3. From the demand perspective

Take MicroStrategy as an example; they announced a financing plan called the 21/21 Plan in October this year, aiming to raise $42 billion in new capital over the next three years to purchase Bitcoin. As shown in the figure below.

This will further impact the demand for BTC. In addition to MicroStrategy's continuous and aggressive purchasing power, their actions will also attract more capital to join this field.

Moreover, we must not forget about BTC ETFs. US spot ETFs currently hold over 1.1 million BTC, a number that has already surpassed Satoshi's wallet, as shown in the figure below. And the approval of ETFs has been less than a year, which seems to be just the beginning.

Perhaps in the past, some people might have considered the barriers to buying BTC or that BTC was too expensive as reasons, but now, people in traditional finance can easily purchase BTC ETFs (IBIT, FBTC, GBTC, etc.), which will further stimulate the long-term demand for BTC. As shown in the figure below.

4. From on-chain data

Through on-chain data, we can intuitively see that the demand from retail investors for Bitcoin is surging, reaching the highest level since 2020. As shown in the figure below.

With Bitcoin breaking through the psychological barrier of $100,000 this month and a frenzy of media coverage, it seems to have reignited retail interest and purchasing demand, with retail investors becoming increasingly interested in Bitcoin.

For seasoned investors, the large-scale entry of retail investors often means that long-term holders may start to take profits, but during this process, the market usually continues to experience its most frenzied moments. Currently, Bitcoin's breakthrough of $100,000 is just the beginning of attracting retail investors; we are still some distance (in time) from the theoretical bubble of this cycle. Perhaps approaching $150,000 will become the threshold for this bubble.

Next, we should focus on and monitor the activities of retail and institutional investors. The strong enthusiasm of retail investors often indicates the maximum level or intensity of market optimism, while the interest and movements of institutions determine whether this sentiment can be sustained. Remember, in this market, only a small portion of people can make money in the end.

As for altcoins, I would like to mention at the end of the article that we maintain our previous viewpoint: the large-scale entry of retail investors and the rotation of altcoin sectors are often signals that the bull market is entering its mid to late stages. If you don't want to lose money in a bull market, you must adhere to the most basic principle of "don't touch what you don't understand, and protect your principal." DYOR, don't chase highs, don't leverage, or simply avoid altcoins altogether.