Timing is everything.
Imagine starting a subscription newsletter about cryptocurrency, then seeing the market fall apart within three days after the first post.
Read everything below, listen to the embedded audio, and keep in mind, by the time you read this, the situation may have changed (hopefully for better, not worse).
Bitcoin
Unfortunately, I missed all of the crash from $5,900 to $4,000. Thursdays are always a busy day and I had to push off some tasks to prep and post the video I sent yesterday. I actually didn’t know we’d dropped so hard until I checked my phone right before I went to bed. You can imagine my surprise when I saw bitcoin at like $4,600 or something like that.
When I woke up this morning, I wanted to see a bounce back up above $5,400 or somewhere near it. As I said, the price can tap $5,400 and still validate the thesis. It can dip below and then come back up, too.
We did that.
I also checked the HODL charts and LTH-SOPR, which show the behavior of long-term investors. LTH-SOPR looked fantastic and while HODL chart showed a little bit of flight from 1-year and 18-month HODLers, older wallets held steady. With the shorter-term metrics, it’s hard to know how much activity comes from the PlusOne scammers and tax-loss harvesting as opposed to widespread panic.
Does that mean we’re safe? Bitcoin’s going to $1 million?
No, not yet. Everything can change in a heartbeat. Let’s see what the weekend brings.
This newsletter
As far as Crypto is Easy goes, nothing has changed. As I promised, I will give you my perspective on the markets, tell you about interesting altcoins, tell you about airdrops, share guest posts and interviews, and give you my plan for the bull market.
I will do all those things. From an investment standpoint, opportunity abounds. From a technology standpoint, interesting projects are everywhere.
There is so much going on that has nothing to do with the price of bitcoin.
We have awesome projects that still offer tons of potential gains, interesting products and services that use crypto, and a whole bunch of legal and regulatory issues that will cause all sorts of problems as crypto grows.
I already have one airdrop ready to go—actually the perfect project for times like these—and another that seems legit but I want to confirm a few things before I recommend it.
Also, I have drafted my write-up of the altcoin I told you about. I’m just confirming some information with the project team.
And, I still have a plan for making the most of bitcoin’s bull market. After all, bitcoin’s price just went up 50% in less than 12 hours. It’s not dead yet.
Why would I persist if bitcoin’s price keeps crashing?
Cryptocurrency’s value has no relation to its price.
This technology will change everything in fundamental ways. I love playing a very small role in its evolution. I wrote two books about crypto. It’ll take a lot more than a crash in bitcoin to get me to stop caring about crypto.
Why do I still HODL alts but not bitcoin?
For alts, I have a specific investment thesis for each project. Almost all of my alts serve a real and distinct role, address a genuine problem, and can succeed without any speculative interest. For these projects, alt season is a bonus, it’s just gravy on top, not part of my investment thesis.
Also, unlike bitcoin, we have little data about how these assets perform as investments. As a result, I can’t include price as a factor in my investment thesis.
While I expect many alts will die, the ones that succeed will be worth so much in the future, it will not make sense, it will seem absurd. In five or ten years, today’s drop will look like a tiny blip. And, if we do get that bitcoin bull run, which I still expect, those alts will do moonshots (probably bigger moonshots than bitcoin).
I do hold a few alts as pure speculations, with the plan to sell for bitcoin when they pump high enough. Only a handful, though, and only with very, very small amounts of capital at risk. I think they give me better odds than blackjack or lottery tickets.
You
If you only care about getting rich or making money selling bitcoin for more than you bought it for, now is the time to buy.
While bitcoin may go down, it will probably go up. You risk a small loss in exchange for the chance to make a big gain. Once we get into that big parabolic bull run everybody hopes for, you will risk a big loss for a relatively small gain. Why wait until the odds are against you?
For me, bitcoin plays a small role in a larger investment portfolio. While I still think bitcoin will serve as the settlement layer for the vast majority of global transactions, that will take a while. With so much upside if that happens, I only need a small allocation.
For you, bitcoin may offer a once-in-a-lifetime opportunity to change your life, if you can stomach the highs and lows. We may see HUGE gains over the next few years—if bitcoin doesn’t collapse. As long as you limit your risk and you’re willing to walk away when your investment thesis falls apart, you can invest confidently in any asset.
Should you? I can’t answer that question.
Right now, financial markets are haywire. Everything’s screwed up. Nobody knows how long it may take to get right. Newspapers in the US say the Fed will cut rates to zero.
It’s still possible the traditional financial system fails. Let’s hope and pray that doesn’t happen, but if it does, you will thank your lucky stars you hold bitcoin.
Who knows? This crash may serve as the platform for a massive bull run in all assets, not just crypto. U.S. stocks had one of their best years ever in 2009, the middle of the Great Recession.
Bull markets always start in darkness.
Relax and enjoy the ride!
Bitcoin Meltdown - Update #2 (with audio)