Bewilderment Intensifies

Bitcoin has ripped to new all-time highs over the last 48 hours. Waking up on Friday, July 11th bitcoin had breached $118,000 dollars and was within arm’s reach of $120,000. This recent price action has caused me to scrap 2 different newsletter ideas in favor of discussing the all-time high. Buckle up, if you are a bitcoiner, I believe you are in for a ride. If you are a no-coiner, I think that decision will become next to impossible to rationalize by the end of the year.

We are in a time of bitcoin price discovery.

This post may be jumbled, but there are a lot of different ideas to explore.

One I feel most strongly about is that curiosity is the only limit to human knowledge and, therefore, human potential. It is mind-blowing to me how many people in our society today aren’t curious. So many people doom-scroll on social media in consumptuary habits, just waiting for that next dopamine hit that will come from the algorithms. If you are someone who finds yourself opting to doom-scroll constantly, consider changing. I believe you are only wasting your potential and limiting your life if you are not curious. Care to be curious. Dare to be curious. Use curiosity to expand your perspectives.

We all have supercomputers in our pockets, and with new AI developments, it has never been easier to find information about anything. This opinion finds root in the fact that, in hindsight, bitcoin will have been obvious for everyone. Right now, it is still a niche idea with many doubters. However, for the people who were curious enough to spend hours of their time learning, the floodlights opened up in their minds. I am not lucky because I understand bitcoin. I was simply curious enough to dig in and learn about something.

We are reaching a point with bitcoin where everyone will be asking you, a bitcoiner, about bitcoin and will not understand why and how bitcoin is going up in price. For someone who has gone down the economic rabbit hole and cared enough to be curious about defining sound money, bitcoin is obvious, and the more you learn, the more you see this to be the truth.

Bewilderment will be everywhere.

Strategy $MSTR ( ▲ 3.05% ) as of today has added over $5 billion to its balance sheet in the first 10 days of the fiscal quarter.

I cannot comprehend this and do not think there are many, if any, examples of other companies doing this. Their full treasury is roughly $80 billion and is on par with Meta, a magnificent 7 company. What Michael Saylor has championed with their move to bitcoin will break all traditional finance models and will reshape the trad-fi world. We are already seeing this as the adoption curve for companies holding bitcoin on their balance sheet is rapidly scaling upward. I believe that in a few years’ time, companies will not have a choice whether they hold bitcoin or not. They will either hold bitcoin and survive or not hold bitcoin and die. This idea causes immense bewilderment for many.

Bewilderment intensifies.

Saying you will buy the next dip is a tale as old as time. Human psychology is human psychology, and there is a reason people have fomo (fear of missing out) when prices soar to all-time highs and sit on their hands when prices dip. I don’t encourage timing the market; I encourage time in the market. If you are considering buying, there is a simple thought exercise I enjoy. Consider which you would hate more: not buying and seeing the price skyrocket in the next week, OR buying and seeing the price fall next week. I do preach to dollar cost average so that you capture the ebbs and flows of the market, so this thought exercise is for all my chunk buyers out there. At the end of the day, if bitcoin goes to millions of dollars in the future, it won’t matter what price you purchased today; it will just matter if you did.

Bewilderment is soaring.

As bitcoin reaches all-time highs continually, it is easy to think you have missed the boat, are too late, or that it is not worth your investment. This is crazy talk. I view a logical base case for bitcoin as it replacing gold as the store of value that people in the world use. If bitcoin reaches the market cap of gold (~$20 trillion), that is still around a 10x in price. Find me another bet in the world that the logical case is a 10x and I will eat my sock.

Bewilderment intensifies further.

Bitcoin requires you to remove your ego. It requires that you admit you don’t know everything when you first learn about it. It requires an acceptance that, like gunpowder, the combustion engine, and the internet, sometimes there are paradigm shifts that require new ways of thinking. Bitcoin is not some bubble, it is not some Ponzi scheme, and it is not imaginary. It is backed by the largest computer network in the world and operates on a strict scarcity measure that nothing else in the world can match.

Bewilderment intensifies further still.

If you don’t have bitcoin, you are short bitcoin. That is not a bet I would like to make. At this point in time, after over 15 years of trading (more hours traded than the traditional stock market), and being one of the highest returning assets in 12 out of those 15 years, not holding bitcoin is ignorant and firmly positions you to be in the camp that is short a fundamental paradigm shift in the world. Evaluate your holdings and decide for yourself if you are “short” bitcoin or if you have your foot in the door for the years to come.

Bewilderment approaches maximum.

Lastly, it has never been more evident to me that bitcoin is the most asymmetric bet known to humankind. It either goes to $0 or it goes to infinity. In a far enough timeframe, these are the only two possibilities that make sense. You are making a bet based on human history that humanity will continue to opt to use the hardest asset to store their capital for the future. Humans did this for thousands of years with gold. In an ever increasingly digital world, bitcoin beats gold on nearly every measure. The downside (assuming you hold a full coin) is that you lose ~$118,000. The upside is infinity. To go to “infinity,” all it needs to do is continue taking a larger percentage of the world’s value/wealth. Currently, it takes up about $2 trillion of the over $900 trillion dollars of wealth.

Is it possible to be more bewildered?

All of these thoughts and no mention on what happens once nation states start buying or the impact of the bitcoin halving.

Embrace bewilderment.

Cheers.

Stack SATs.

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