Goals from Luis Suarez and Daniel Sturridge put the Reds firmly in control inside the opening 20 minutes and Steven Gerrard added a third before half-time from the penalty spot.
Holloway acknowledged after the final whistle that his side had been given a harsh lesson, but he was able to take a lot of positives from the way Palace battled back after the interval and grabbed a late goal through Dwight Gayle.
He told Sky Sports: "It is very difficult. You make any sort of mistake at this level and you are punished, especially with their strike force.
"A large majority of it I was very pleased, particularly in the second half. I thought a lot of teams would have folded there after what happened, but we came back.
"Unfortunately we are finding out the hard way that at this level if you don't take your opportunities, and they might be few and far between, it is going to be a long tough game and season."
Holloway was unhappy with Liverpool's third goal as he felt the referee had made a mistake in penalising Dean Moxey following an incident with Raheem Sterling.
He said: "It's absolutely minimal contact, if anything at all, and it wasn't even inside the box.
"If that's a penalty then we should have had one with Jimmy Kebe, that's my honest opinion. (Mamadou) Sakho's done much more to stop him getting to the ball than ever dreamed of happening at the other end."
Holloway added: "I thought the second-half performance showed a lot of guts and determination and that's Palace for you. I think our fans were fantastic and we'll gain a lot of belief from that, actually winning the second half 1-0."
Holloway also lavished praise on Gayle, saying: "He is fantastic striker. With his predatory instincts I need to think about getting him right through the middle and getting him on the last man if I can."