Jack Mallers says Bitcoin’s bear market has left him “getting my ass kicked,” but the Strike founder believes that is exactly what makes the asset different from traditional financial systems.
In an essay published Friday, just days after stepping down as CEO of Twenty One Capital, Mallers argued that Bitcoin’s painful downturns expose reality instead of hiding it.
Mallers Says Bitcoin’s Pain Has a Purpose
Mallers wrote that he originally drafted the essay on July 11, before resigning from Twenty One Capital, intending to publish it the following Monday. That plan changed after he was told to wait until his departure became public.
In the opening note, he acknowledged that the company he believed he was building and the direction it ultimately took “were no longer the same,” leading him to step away. He also accepted responsibility for helping create expectations that “were not ultimately fulfilled,” while making clear that the essay was not intended as a defense of his decision.
Instead, Mallers used Bitcoin’s latest bear market as a lens through which to examine leadership, conviction, and failure. Although BTC is trading almost 50% below its all-time high, he argued that the emotional toll extends far beyond financial losses.
“I am not writing this from the peaceful other side of the storm,” he wrote. “I am still in it.”
Drawing a contrast with traditional finance, Mallers said governments, banks, and institutions frequently soften the consequences of poor decisions through interventions such as bailouts and refinancing. Bitcoin, by comparison, refuses to do that.
“The world I am used to keeps trying to protect me from the lesson,” he noted. “Bitcoin does not.”
He described volatility as information rather than weakness, maintaining that price swings expose excessive leverage, poor decisions and fragile business models instead of concealing them.
Bear Markets Expose Weakness, They Don’t Create It
Looking back at the collapse of FTX in 2022, the former Twenty One CEO contended that BTC did not create the fraud, as the bear market simply removed conditions that had allowed weak businesses and unsustainable leverage to survive.
He also admitted that previous bull markets had shaped his own behavior. Reflecting on product announcements made during the 2022 Bitcoin Conference, Mallers wrote that he had started confusing “attention for proof of work” and “vision for execution,” calling the admission one of the hardest sentences he had written.
His resignation from Twenty One became another example of that same lesson. While declining to explain every detail behind his departure, Mallers said the experience forced him to test whether the principles he had spoken about publicly were genuine when faced with easier alternatives.
His comments come amid ongoing debate as to whether Bitcoin’s bear market has already bottomed out. Some analysts, including those from Grayscale, say the macroeconomic conditions are more important now than the classic four-year cycle. However, others still expect one last dip before a sustained recovery.
But Mallers didn’t spend a lot of time predicting prices, with his argument being much simpler: the discomfort of a bear market is precisely what keeps Bitcoin honest.
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