Welcome Anon, it’s been a while since I wrote a thought leadership-based article so I figured it was time to drop a braindump of how I am perceiving the market environment.
We’re in war times and there is an inherent creeping despair in the industry as it is getting attacked left, right, and center. People naturally come to this industry because of the opportunity it provides but realize how painful bear markets can be to earn those rewards. Many people got duped by the infamous Zuper cycle and whenever someone thinks the bear market has been “easy” they get humbled quickly. Many of you that have been reading my newsletter for a while now know that I have been iterating that you should ignore people claiming that this is a bull market because the price went up for a while.
Crypto come and go in 4-year cycles and within those 4-year cycles, we always have boring sideways periods which are the killer. While people are aware of this they still decide to quit despite knowing this is when it will pay off the most in a longer time frame.
What are you?
The markets are sh*t I know. And it’s hard for a lot of people to watch legacy markets run up while crypto is getting slaughtered.
If that’s the case you have to decide, are you solely a crypto investor or a pure investor that goes for monetary gains in all realms possible? Because I do hold some AI stocks, $AI and $U along with $AMD (chip company but has been a good NVIDIA beta) for curious people (not Financial Advice). I hope AI runs hot for the foreseeable months and if we get a major selloff event in crypto, best believe I will take some of those AI profits and rotate into ETH.
I currently allocate to ETH on every red day slowly with patience. In case we get a nuke, I have a large stack that is ready to be deployed. If you liked ETH in 2018 at $1400 and you don’t like it at these levels with the growth and technological developments that have been built in the ecosystems since then, you must be insane in my opinion.
For me the thesis is simple, I don’t care if I buy some “overpriced” ETH that I will stake at these levels while waiting for a dump. I don’t solely operate under the premise that I am right, I also operate under the premise that I might be wrong. If I believe ETH will go to 9-10K during a bull market whenever that comes, will I really care if I bought ETH at $1600 vs $1800? Yes, it’s a 6.25x vs 5.5x at best. However, what matters is the size you make that multiple on. I rather make a 5.5x on proper size that will move the needle in my portfolio than 6.25x on smaller size because I was timid and scared.
Bear in mind I believe that we are finding ourselves in a similar market environment to Summer 2019 which still had some upcoming curve balls while being a boring market. I don’t think anyone that has been here for some years has forgotten March 2020.
Either way, I don’t suggest you do the same thing as me but you need to find something that works for you.
AI & Rage
I truly believe that the AI rotation into crypto will be for the ages. VC investment in crypto is apparently at all-time lows. All grifters have pivoted into AI. I think we are many months out before this takes place and I would expect this rotation to start taking place around Q1 2024 in accordance with the Bitcoin halving (and I might be completely wrong and I’m fine with it).
The current sentiment is horrible, people are fighting and going after Cobie after already having been successful in driving off GCR. While the sentiment is annoying, current PA is ideal in my opinion. People have a need for prices to go up. In my ideal, world which I stated in the December article hinting at a bottom, we get many months to accumulate. If you believe in crypto long-term you want to get as much time as possible to stack cash and allocate it into crypto before the market picks up. If you give me >8 months to accumulate with sideways PA, this will be the final result:
People lack emotional control and take it out on people more successful than them because they are entitled and can’t think for themselves. Wanting people to handhold you when you’re making financial decisions. With that mentality, you might as well go to your local banker and let him allocate your capital for you which is an official statement that you’re ngmi. Now, don’t get me wrong, spitballing and discussing financial investments isn’t a bad thing but when you want, an entry price, target, stop loss, trading setup, etc you’re in for a rude awakening.
These scenarios make it increasingly difficult for people with a growing account to share any directional opinion because people are quick to jump on them if it doesn’t go exactly as planned. Having a private substack chat with a fellow few people here has been quite enjoyable as it isn’t as noisy.
BTC
Yanet Yellen even believes the U.S. dollar will decline as a reserve currency. While this doesn’t mean Bitcoin will become the de facto reserve currency but it gives it an opportunity to gain strength against other currencies. Fiat currencies make a lot of sense to me when I apply the crypto market logic to it where I view the dollar as Bitcoin and the Euro as Ethereum and the rest as altcoins.
Bitcoin is here to stay and that is the same for the growing crypto industry. It is now too big to ignore and also creates new jobs and advances our technological capabilities. While people struggle to name use cases apart from stablecoins and being able to move money cross-border permissionless, what has been built is undoubtedly underrated. DeFi has solved peer-to-peer lending which hasn’t been done successfully in the Fintech space. Legacy markets discredit “crypto” but love “blockchain” technology and understand that the swiftness of being able to transmit money is 10 times more efficient (at least) than what they have built. Unfortunately for us, they are trying to use this to implement a CBDC but it still means that the technology is useful no matter what doomers want to tell you.
I can also understand that the tone of this article can be perceived as harsh and unapologetic. That might be the case but we’re in war times and this is being written with a no-nonsense mentality. I’ll keep this one at this length I don’t want to bore you with a too-long article. If you liked this and want me to make more of these brain dumps let me know.
I hope you enjoyed the post. Don’t forget that you are more than welcome to leave feedback or drop any questions in the comment section.
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Disclaimer: All Content on this site is information of a general nature and does not address the circumstances of any particular individual or entity. Nothing on the site constitutes professional and/or financial advice, nor does any information on the site constitute a comprehensive or complete statement of the matters discussed or the law relating thereto. This post may contain affiliate links. I am just a random degenerate sensei sharing an opinion.
nice one, some sober straight forward advice right there !!