This quote is often cited by traders, but I believe it applies just as well to investors. At the end of the day, whether you trade or invest, it’s still a game of capital.

You should always leave room for the possibility that you’re wrong in any position. That’s what allows you to cut losses decisively based on logic, not emotion.

In practice, before making any investment, I always draw out a full picture that includes both a Bull Case and a Bear Case. You need to understand what you’re holding, otherwise “hold to die” becomes literally holding so you die, rather than holding with conviction until the end.

In previous newsletters, you and I have aligned on where the market currently sits in the cycle: near the top, but not the end of the cycle.

Last week, I read two pieces offering similar perspectives on the market, one from Wintermute and one from Ray Dalio. Ray Dalio, in particular, provided a detailed breakdown of how this round of QE differs from past cycles.

Here’s a concise summary of Ray Dalio’s key points:

QE was typically deployed when:

Today, QE is being deployed under almost the opposite conditions:

Because of this, Ray Dalio described the current QE as “stimulus in the middle of a bubble.”
I’ve previously referred to this as “pouring more oil onto the fire.”

From Dalio’s analysis, another key insight emerges:
The Fed does not actually want to inject liquidity into an already overheated market (Stock, AI, real estate, credit are all expensive), but it is forced to do so.

If the Fed does not implement QE, the financial system risks liquidity stress. The government may struggle to borrow, yields rise, and a debt crisis could unfold.

If the Fed does implement QE, asset bubbles may grow larger and inflation risks increase.
But in exchange, short-term stability is preserved.

In short:

This is before even considering political pressure. In a presidential election year, there is always added incentive to support financial markets.

The Good News

QE has begun. This means asset markets still have upside potential.

There is still room ahead.

However, we need to be more careful about where we are in the cycle. We are closer to the top than the bottom, and not every future crash will be a buying opportunity like before.

The Bad News

The market remains cautious and defensive, even after QE was announced (it was actually announced one week earlier, yet markets still fell).

Why?

Because QE comes bundled with other unresolved risks:

Government shutdown

Trade tensions

AI bubble concerns

That said, following the announcement of a temporarily acceptable trade negotiation outcome, another key pressure point is easing:

The potential end of the U.S. government shutdown.

If this does materialize, it could act as a short-term catalyst to help markets recover further this week.

Over the past two weeks, most narratives and trends in the crypto market have been overshadowed by a bigger concern: overall market growth potential.

As a result, there wasn’t a single standout “Spotlight” event this week. Instead, the most striking visual came from a chart by Galaxy Research:

“Drawdowns of the Top 100 Cryptos Since Jan 1, 2024 (Ex-Stablecoins)”

The sharp sell-off on October 11 added even more drama to this chart, effectively erasing most of the gains many coins had accumulated throughout 2025.

The headline number is stark:

And this only looks at the top 100, and only relative to ATH levels from early 2024.

If you expand beyond the top 100, or compare against the 2021–2022 cycle peak, the picture becomes far more brutal.

Today’s market contains:

Meanwhile, liquidity and attention are finite resources.

This inevitably leads to capital fragmentation and forces you to change how you approach the market if you want to survive and operate in it for years to come.

I’ve shared this analogy before, but it’s worth revisiting if you missed it:
“The crypto market today is like a leaky bucket.”

In a boring, downward market with no clear speculative narratives, it’s unusual for capital to rush into anything. That’s precisely why the continued outperformance of $ZEC and $ORE attracts even more attention.

As mentioned in previous issues, both are difficult to value clearly, making them attractive targets for traders looking to recover losses when no other narratives are available.

I came across a post on X summarizing Solana’s key metrics for October. Highlights include:

For deeper insight, you can read Messari’s full Q3 Solana report.
Overall, Q3 saw fewer users, but a stronger foundation.

As interest in privacy grows following Zcash’s surge, Vanish has emerged with a solution for private swaps on Solana. The project is backed by Colosseum and Solana Ventures, and does not yet have a token.

Euphoria is preparing for mainnet on MegaETH. Last week, its co-founder livestreamed a product demo. The concept allows users to trade directly by tapping on the chart interface.

It resembles binary trading, but with a more unique visual layer. Whether it achieves product–market fit remains unclear, but given MegaETH’s focus on fast, smooth trading, it’s worth monitoring.

The Upside team highlighted an interesting observation: NFT were once considered one of crypto’s most revolutionary sectors, yet they’ve been quiet for a long time. Tokens tied to NFT projects have largely lost momentum.

The only major exception is OpenSea, which still hasn’t launched a token. Given current conditions, waiting may actually be the optimal strategy.

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