Last year I met a trader who’d spent two years trying to time bitcoin cycles. He was exhausted. He’d made a few profitable trades and lost money on others. His best and worst calls had been separated by weeks, but he had no way to predict which was which in advance. He finally just converted everything to a dollar-cost averaging plan and stopped trading. Three months later he said, “I wish I’d done this years ago.”
That conversation captures something important: bitcoin’s most reliable strategy has never been trading cycles. It’s been holding. Every investor who bought bitcoin at any point and held for four years has made money. That’s a 100% historical track record. No trading strategy can claim that.
The Rolling 4-Year Window Evidence
Let me be specific with the data: if you bought bitcoin at the absolute peak of the 2017 bull run and held for four years, you made money. If you bought at the peak of 2021 and held for four years, you made money. If you bought during the March 2020 COVID crash, you made a lot of money.
There’s never been a 4-year holding period in bitcoin’s history that resulted in a loss for a buyer who didn’t sell before that window ended. This matters because it means you didn’t need to time the market perfectly. You didn’t need to buy at the bottom. You just needed to buy and hold for four years.
Compare that to traders: they try to call the cycle top, sell, and buy back lower. The success rate is terrible. Even professional traders underperform simple buy-and-hold strategies. This is well-documented in financial literature. Time in market beats timing the market, almost always.
But with bitcoin specifically, the margin is even wider. Bitcoin’s supply schedule is fixed. New bitcoin enters the market at a predictable, declining rate (halving every four years). Every four years, the halving cuts the new supply in half. This creates a cyclical tightness in the market: supply becomes relatively scarce after the halving, demand gradually builds over the year following it, and then we reach the next peak.
This cycle is visible in the data. But here’s what most traders miss: the cycle is predictable in direction (eventual bullish) but not predictable in timing (exactly when the peak comes). So if you try to time the peak and sell, you either get lucky or you miss the next year’s returns while waiting to buy back lower.
The Cost of Getting It Wrong
Let me give you a concrete example: an investor who bought bitcoin in January 2017 and held until December 2024 saw roughly 14x returns (from $1,000 to $14,000+). But if they tried to time the cycle and sold at the January 2018 peak thinking it was over, they’d have locked in a gain. But then they’d need to buy back. If they waited until the bear market bottom in 2019 to re-enter, they’d have missed the 2020 run. Even trying to “buy the dip” at a 50% lower price, they’d have been better off just holding the whole time.
Saifedean Ammous has written about what he calls “low time preference.” It’s the ability to wait for long-term returns rather than grabbing short-term trades. In “The Bitcoin Standard,” he argues that bitcoin’s supply properties naturally attract capital from people and institutions with low time preference,people who are saving for the long term.
Trading requires high time preference: you’re constantly re-evaluating, constantly trading, constantly paying taxes on short-term gains (which are taxed at higher rates than long-term gains). You’re also constantly paying fees and spreads on your trades. A trader who makes 20 trades a year with average slippage of 0.5% per trade is giving up 10% per year just to the cost of trading, before accounting for taxes.
Someone doing dollar-cost averaging (buying the same amount every month or quarter, regardless of price) eliminates the need to predict timing. They buy more bitcoin when the price is low (your fixed dollar amount buys more coins) and less when the price is high. Over a full cycle, this simple strategy beats trying to time the market.
The Psychological Challenge: Holding Through -80% Drawdowns
Here’s where the real test is: bitcoin Has had three major drawdowns of -80% or more in its history. The 2018 bear market. The 2022 bear market. These aren’t fun to experience. Your allocation shrinks. The news is negative. Everyone around you is asking why you haven’t sold yet.
The investors who made fortunes in bitcoin are almost uniformly the ones who held through these drawdowns. The ones who capitulated and sold at the bottom missed the subsequent recovery. Michael Saylor has spoken about this with MicroStrategy: they held through crashes because their thesis was that bitcoin Would be more valuable in the future, not that it Would smoothly go up every month.
This is where holding differs from trading. As a trader, your job is to predict near-term price movements. As a holder, your job is to have a thesis about where an asset Will be in 5-10 years, and then hold while temporary cycles happen. The thesis for bitcoin holders is straightforward: a non-debasable monetary network Will become more valuable as global monetary conditions deteriorate and institutional adoption increases.
If you believe that thesis, temporary 50-70% drawdowns are noise. You’re not selling because you’re not checking prices daily. You’re not checking prices daily because you’ve already decided: you’re holding this for four years minimum, so price movements in months don’t matter.
The Dollar-Cost Averaging Advantage
The simplest way to remove emotion from bitcoin investing is dollar-cost averaging (DCA). You decide on a fixed amount,$100, $500, $1,000, whatever you can afford,and you buy that amount every month or every quarter, regardless of the price.
When bitcoin is at $60,000 your $1,000 buys 0.016 coins. When it crashes to $20,000 your $1,000 buys 0.05 coins. You’re automatically buying more when the price is low and less when it’s high. Over a full cycle, your average cost is better than picking a single entry point.
More importantly, DCA removes emotion. You’re not trying to call the bottom. You’re not trying to call the top. You’re just accumulating steadily. Fidelity’s research on cryptocurrency showed that a DCA strategy had lower volatility than a lump-sum investment while producing comparable returns over the long term.
SimplB clients often use this approach: set up a monthly automated purchase of bitcoin and let it run. You’re not thinking about price. You’re not trading. You’re building a position over time. When you look at your holdings in five years, you’ll likely have made money.
The Meta: Thinking Like a Holder, Not a Trader
The shift from “trading an asset” to “saving in a monetary network” is the mental inflection point. When you think about bitcoin as a tradeable commodity, you’re constantly assessing short-term momentum, technicals, sentiment. When you think about bitcoin as a way to store value in a monetary network that can’t be debased, you’re assessing long-term adoption, network effects, macro conditions.
Traders ask: “Will the price be higher next month?” Holders ask: “Will this network be more valuable in five years than it is today?” These are fundamentally different questions requiring fundamentally different analysis.
The evidence shows that asking the second question (and then holding while the market cycles) has been much more profitable than trying to answer the first one.
The South African Specific Example
A South African who converted rand to bitcoin in early 2020 at roughly $8,000 per coin Would have held through the 2021 peak, the 2022 crash, the 2024 recovery. By 2024, their bitcoin is worth roughly $60,000-$70,000. But they’ve also had the benefit that their wealth is denominated in something other than rand while the rand lost another 5-10% of its value against the dollar.
Someone trying to trade this volatility Would have sold at the top in 2021 and tried to rebuy lower. Even if they successfully rebought at $20,000 in 2022, they’d have missed the year 2023-2024 rally. They’d likely have been better off holding the whole time.
The simplest person to play this strategy as a South African: set up a monthly R2,000 or R5,000 purchase at a CASP-licensed provider like SimplB, and let it run for five years. Don’t check the price daily. Don’t trade on news. Just accumulate steadily. At the end of five years, you’ll have a position that’s likely worth significantly more in real terms (protecting you from rand debasement) with minimal effort and zero emotional burden.
Why I’m Telling You This
The bullish case for bitcoin is often framed as a prediction: “The price Will go to $100,000” or “$250,000.” I don’t spend much time on these predictions because they’re impossible to predict with precision. But the case for holding is not a prediction about next month’s price. It’s an observation about what’s happened historically: investors who held bitcoin for four-year periods always made money. They didn’t need to time the market. They just needed to hold.
If you’re considering bitcoin and you’re worried you’ll buy and then the price Will crash, remember this: you probably Will buy and the price Will crash at some point. That’s normal. The investors who made money are the ones who held through the crash. The traders trying to avoid the crash timed it wrong and missed the recovery.
The most reliable strategy has been the simplest one: buy and hold. If that’s boring, good. Boring strategies win long-term.
