Time To Be Bullish? | 1000x Live

it's important to not always trade. You have to pick your spots very carefully and you have to understand when you have edge and when you don't have edge. So for example, what I say now, hey, go out there and go buy a bunch of BTC and then short a bunch of alts against it. You don't need to put on that trade now. You can wait for the opportune moment and sometimes the opportune moment doesn't come. But if we get a squeeze across the board of these shorted alts, then why not be there to take the other side? All right, we're live. Let's see who's here.

I feel like we're like gamers, Avi.

Like, I mean, this is, this is the literal video game. Is it not a video game for you? Because it's video game for me. Trading is like, you got all, you got the flashing lights, you got the dopamine, you got the stimulation, you have lack of social life. I mean, you basically have all the hallmarks of being a gamer.

You got the wives, mothers, girlfriends hating you.

Yeah, actually, you know, my girlfriend knows nothing about crypto, which is an amazing thing, wonderful thing. And she's telling me that— Yeah, and she— 100%. And she was telling me that, you know, if I want the number to go where I need it to go, I should just close my eyes and visualize it.

No, that's terrible advice. That's like, um, that like manifesting money doesn't work. Remember we talked about this, uh, reminiscences of a stock operator. If you're like, I want to earn enough money trading stocks to buy that fur coat, you just get rinsed. I—

yeah, don't, don't trade for the fur coat. Never trade for the fur coat.

Never.

But I do think, you know, there's this one guy that I used to listen to, or this one documentary of this large Australian commodities trader named John Moulton. And the guy, the guy was a legend. He just yelled out things on the floor and he was a lone guy, didn't trade for a bank, didn't trade for anyone, just traded for himself. And he would sling massive size. And he made, you know, what it seems to be reasonable money throughout his career. And he's like the epitome of a discretionary trader. One of his pieces of advice is that if you ever don't know what to do, just stare at the chart for 15 minutes, close your eyes, and then walk away. And then it's your gut instinct is the next move.

So his middle name is— his nickname is Rambo. I just Googled him. He's John Rambo Molton.

He's amazing.

He's amazing. And everybody, I did that, I would literally lose everything. So I guess what works for Rambo doesn't necessarily need to work for you, but maybe it does. In fact, I'm gonna try that. I think this is the time to trade actively, Avi. I'm like I'm normally a pretty passive long kind of guy. I just sit there and hold stuff that I like and occasionally rebalance or clean up line items or add line items when I want to gamble on something. But like this time, I think like basically I think that the market, the crypto market has disconnected to the downside from the sort of fundamental picture for crypto. And I think that on some of these savage dips of despair, you get some pretty crazy looking alt buying opportunities. Like, I have a fair amount of conviction in certain alts, uh, and their ability to perform if we get the right sort of outcome in the election, which again is a coin flip, right? So, you know, the risk-reward looks pretty decent in certain cases when, when the market's shanking on fear and uncertainty.

Yeah, I don't, I don't think the market's fully shanked yet. That's, that's the thing. I mean, if you look at, just look at price action today, I mean, one of the things you should always be paying attention to if you're doing anything in this market is just pull up, pull up open interest and pull up funding. And you look at, you know, try to look at moves in the context of what is driving them. So today I just did not for even half a second believe the move to $61K. Uh, and I mean, let's see, let's see where it shakes out here. I still think that we've got a little, a little bit lower to go. I mean, maybe, maybe $58.5K. From here. But if you're actively trading, what you saw is you saw OI go from 185,000 coins when price was $60K to 193,000. That's 8,000 BTC worth of longs that were added, and it moved price $1,000. That is ridiculous. And to me, what that suggests is that suggests somebody trying to either take people out of their stops because there are probably a lot of people that were short that, you know, were stopping out above $60K. But very rarely— I don't think I've ever actually seen it other than when you're in, you know, the early stages of a depressed market, like when you go from FTX into market starts going back up again. I don't think I've ever seen that type of OI ramp stay. Uh, and this is a trending mark— this is not a trending market, this is a choppy market. So anytime you see a data point like that, you have to think to yourself, all right, well, I probably should be less long than I was before, right? And one thing that's important is you, you don't always have to take a position, uh, but you do always have to evaluate where you are relative to before. So again, this is only if you're actively trading, but if you were long 100% at $58K and now we're at $61K and you see that data point, you have to be either less long or you have to make other arguments for why you should stay as long as you were before, because price went up and the risk, risk in the risk in the market started going up, right? So I mean, my general view on this market is that the vast majority of price action is still either caused by some random person jamming it on Coinbase or some random person jamming it on Binance Futures, and that is not necessarily a sign of a healthy market. And because we're not at, you know, value levels yet, I don't think $60K per BTC is necessarily a value level for allocators. We're going to chop and grind lower until we either A, stay above $50K for another 2 months, or B, have a flush down below. Those are, you know, my 2 base cases.

That's interesting. One thing that I liked about that narrative is the idea that we're in a very illiquid time. Like, we talked about this on previous episodes, markets absolutely loathe uncertainty. There's so much of it right now. It's hard for anybody to really trade with conviction. And if what you're saying is true, like, you know, 8,000 units worth of OI jams the market that much, like, it shouldn't, you know. So, uh, not that many people are in there trading, and it's, you know, I guess this is the type of market where you want to provide liquidity. You don't want to be a taker, you want to be a maker. So to your point, like, if it's actually shanking, you want to be there on the bid, and if it's roofing, you want to maybe lighten up a little bit, but you don't want to be lifting, lifting or hitting here.

I 100%, I mean, again, it's the Costanza rule that we've talked about. Do the opposite of what, you know, you're, you know, when Bitcoin goes up, your gut instinct is, ah, I gotta buy, I gotta buy. And when Bitcoin goes down, it's like, ah, I gotta sell, I gotta sell.

Well, What would Rambo do? Rambo would stare at his screen and YOLO into tons of big— I don't know. Yeah, fair enough.

All I'm saying is you gotta— and the, the other thing is, you know, take a step back. And I'm saying this to myself as much as I'm saying it to everyone listening, you know, take— you got to take a step back and look at the daily charts and look at the 4-hour charts and not spend all of your time on the 5-minute charts. Because what you have to do in these types of environments is kind of only play at the extremes, right? When something extreme is happening one way or another. I mean, today, like a 5% move up in BTC when equities were down at one point, that tells you, okay, well, maybe something weird is happening, right? Maybe that, that's an inorganic move. Or, or, you know, when Bitcoin in a single candle trades down $1,000, single hour candle, you think to yourself, okay, well, that's a, you know, that's a pretty crazy move. Maybe we should, you know, start buying a little bit, right? Yeah.

And we'll probably get our chance.

So the sort of thoughts that you have to start generating in your head, because I don't see what starts the trend yet. I have a few percolating ideas of what could start a trend, but Um, for now I'm still in chop mode.

Well, tomorrow the market's going to be surprised by the Fed no matter what, right? So that's one potential catalyst that could get things moving one way or another. Yet another reason not to trade right this second. Um, market expectations are like the market— the Fed fund futures market is pricing a 32 basis point cut. So if they cut 25 or if they cut 50 that's going to shock the market either way. Maybe not shock, but a little surprise. And if they cut by 75, which I think is like less than 5% chance, then, then we're off to the races. But I think honestly, Avi, you know, I'm not an interest rate trader. It's like basically the one asset class that I haven't traded professionally. I know nothing about it other than just like, you know, sitting around peripherally kind of gazing at it from the sidelines like, like maybe you do. I noticed that back in 2022 when inflation was 9%, the Fed began their hiking program with 25 bps, and it seemed ridiculous, uh, to me how, like, you know, it's kind of a spit in the ocean when you're trying to solve that, that huge inflation problem. Maybe we're supposed to expect an incremental cautious cut just like they did with their hikes in the beginning.

Yeah, I think, I think that's, I think that's fair. I mean, one thing about the what the Fed is going to do, whether it's 25, 50, or 75. One idea that's going around my head that was brought up by a member of my team today is that Bitcoin and the markets topped very aggressively once the Fed started hiking rates. You know, just look at Bitcoin, right? Bitcoin basically just started a straight line lower once the Fed started hiking rates. And we all know that Bitcoin and equities, yes, they're correlated, but sometimes they're not super correlated. And sometimes Bitcoin can go do its own thing and it doesn't necessarily need to follow risk. The brain dead take is, okay, well, if Bitcoin goes down when the Fed hikes, then Bitcoin goes up. When the Fed cuts. And that in itself, forget the, forget the actual implication for risk, like forget what cutting is going to do for equities. For Bitcoin, that can potentially become something for people to grab onto and for people to say in a looser monetary environment, the bet, in addition to betting that rates are going to go down, is Bitcoin, right? Like the bet becomes Bitcoin. And that, that's one of the ideas that's at least going through my head right now as to why maybe we shouldn't be as bearish as we've been previously. But it's not— I, I don't necessarily have high conviction in that yet. I still lean bearish for now.

Well, this is what I'm talking about, right? Like maybe you're right on a very short-term time frame, but maybe I'm right over the medium term, which is that the fundamentals are really improving. Like central banks are hoovering gold. You ever been to Bhutan, Avi?

Never been to Bhutan. I have. They're very happy there.

Yeah, that's their, that's their marketing jingle for sure. Um, they're not very happy with their local currency though, and I'm not surprised that they've started buying, uh, wads of Bitcoin, right? Like this—

just, just to clarify that, they weren't— they're mining Bitcoin. They're not actually buying Bitcoin. But they're not selling it yet, which is— yeah, well, they're mining it. I mean, they have free energy.

So true. They do have some beautiful Himalayas and hydro and solar and all that good stuff. I mean, I think if Bhutan mines Bitcoin and doesn't sell it, that's just fewer units for the miners that do sell. So that's bullish. I think we're going to see more of that, frankly, in coming days and weeks and months. And I also think that You know, to your point about Bitcoin sometimes being correlated with stocks and sometimes not being correlated with stocks, I think that we've been in a very long regime where Bitcoin is basically levered NASDAQ to the point where you like speak with trad fi guys and they're like, oh, Bitcoin's just 1.5 times NASDAQ. Like, why would you consider it a separate asset class? You know, so to me, that's like the level of complacency that as a contrarian I want to hear before this thing starts to go go parabolic. Now, I don't know when it will go parabolic, and I don't know, uh, I don't know how I'm gonna feel if suddenly the fundamentals shift. But as we've talked about on this podcast before, um, the current sort of news picture is already priced in, and what we have to assess and evaluate is the second derivative of the news. And what I've seen is the news just getting better and better and better, the backdrop getting better and better and better. I expect that to continue because I don't think it's nearly as good as it could be. Um, if we're, you know, cutting rates with stocks and Bitcoin basically at all-time highs, and, you know, then the— if the election, it's a coin flip, but if, you know, the crypto market flips head, like, look out, right? So I don't think things are going to get worse in the near term, um, and I don't really see the price responding to that. So for me, the risk-reward just gets better and better, especially on some of the, you know, lower vicissitudes of this chop.

What do you, what do you say things are going to get when you say things are going to get better? I mean, do you mean just that the Fed, like, you know, you view the Fed cutting as just good across?

Yeah, I mean, I don't think that people understand.

You don't, you don't buy the, you don't, you don't buy the argument that, oh, they're cutting now because the economy is about to get really bad?

No, no, I mean, the Fed, okay, so there are two kinds of monetary— let's, let's call it interest rate responses, policy responses, right? One is, uh, very aggressive action, like aggressive cutting or aggressive hiking. Um, that's usually a response to something supply side, you know, oil shock, demand shock, something crazy, right? So supply side or demand side, I should say. So a shock, right? And shocks are terrible for markets, including Bitcoin. So If the Fed is going quick, like it tells you that there's a broader kind of macroeconomic backdrop that you need to be wary of. If the Fed is like telegraphing for 6 months that they're going to do something and then like easing the market into the idea that they're going to do it, and then they start doing it slowly and steadily, that's less of like a— like, again, Fed policy responses are like an interest rate responses. They're lagging indicators. They're not leading indicators. So unless they're, you know, unless the world is on fire, them like sort of gradually cutting means that the inflation problem is over and then gradually cutting. More importantly, like it's just an asset allocation game, right? Like it means that however many trillions or more than $10 trillion which are currently sitting in things like T-bills and commercial paper and, you know, name your mutual fund like iCash, Bill, whatever, like all of this stuff just looks worse and worse as the yields go from 5 to 4 to 3. And then suddenly, you know, people are sitting there earning 3% on their T-bills. 1.5% after tax, you know, if they live in a high-tax state in America or high-tax place like London. And they're like, why am I, why am I bothering with this 1.5% thing when, you know, Bitcoin has rallied, I don't know, double-digit percentages, you know, compound annual returns for 15 years? Like, maybe I should reallocate a few basis points to that and a lot of basis points to stocks. And I, again, I don't really see a scenario once we clear the uncertainty and the, you know, the regulatory hurdles why Bitcoin— not talking about alts— why Bitcoin would just flatline while the rest of the market, uh, goes vertical. It doesn't make sense.

Yeah, I think, you know, one, one thing that we always, that we always talk about when it comes to crypto cycles is that Bitcoin tends to go up and then altcoins tend to follow. And that's just because of the, that's just because of the wealth effect. So the question is, do we see that dynamic with the S&P and NASDAQ as well? I mean, I think the an— My answer is yes. I mean, if we get, if we get a rip in NASDAQ and S&P all-time highs, I mean, we're very close, touched it on, touched it on, uh, you know, uh, touched on SPY today. I think that what ends up happening is that at some point those people start rotating out and buying BTC as they go, as they go down the risk curve because People want to juice, want to juice the returns, right? And what this sets up for is it sets up for a really good, I mean, really honestly amazing, amazing buying opportunity if what ends up happening is that we do get some, some de-risking as people in the beginning are nervous. Because I think you see what the Fed is doing and you see what the economy is doing differently than some people, right? And so there's reasonable interpretation that, okay, hey, they're cutting. If the data print that comes out, if any bad data comes out, payrolls come out bad, then you probably get a pretty massive de-risking event, and then that's probably the buy. And if they come out good, then We're probably just going straight up, actually. You know, the more that I talk to you, the more bullish I get, because— yes, the less, the less, the less the bear case. Yes, it's a lot of— it's a lot of— you know, what I've found is that whenever you hand wave and try to use macro, uh, you know, to make a bull or bear case for, for BTC, if, if your bear case is, I think equities are going down, or your bull case is, I think equities are going up, then normally that doesn't work. Yeah.

Um, so your point about alts though, is I think the most pertinent question. Like when you said that you think that alts will start to perform because of the wealth effect, like a cohort of listeners who work at protocols with big FDVs and unlocks coming in the next 6 to 12 months were literally like, I think I could hear them or see them in the chat foaming at the mouth, right? Like, this is what they are hoping for. Like, in commodities, in commodities, we call this physical bailing out the paper, right? So, you know, for example, right now, um, the, the crude oil, uh, managed money space, meaning like hedge funds, pension funds, asset managers, they're required to publish their net futures positioning to to the CFTC for regulatory purposes. Um, basically a, you know, way of predicting squeezes and market manipulation, all that, and preventing market manipulation, all that stuff. Anyway, you can see they're all basically as short as they've ever been in the history of the report, and there is literally no way that they make money unless physical bails them out. Now, what does it mean for physical to bail them out? It would mean that, like, COVID hits, right? And suddenly, like, planes stop flying, cars stop driving, and people just don't want the sticky black stuff anymore. And even though they're all in the most consensus trade of all time, the underlying physical economics of commodities bail them out and make them a bunch of money. That happened twice in the last 4 years. It happened during COVID then it happened again during Ukraine, the opposite direction. Now I think you have a similarly, like, extremely consensus sort of like bagholder community of altcoin people just like literally on their knees praying to whatever deity they worship that, like, the SEC gets an overhaul and clears the way quickly for some other source of capital to flow into the altcoin space other than just like a great, you know, greater fools. There are no greater fools to buy. I don't think Bitcoin people are going to be like, wow, I just doubled my money. I'm going to buy SUI, right? I think it's going to have to be like applications that get built on SUI can pass through revenue to token holders and that requires a regulatory change.

What do you think? Yeah, I don't, I don't know. I do think, I do think that what we're seeing right now at least is we're seeing, as we've talked about over and over and over and over, we're seeing a lack of applications being built and there's a gap here, right? And what is the gap? There's a gap for an L1 or infrastructure or something that acts as beta to the upside. Ether has been dog, like dog shit all year. Solana honestly too has not been great this year. It was really great last year. This year it's okay. You know, it's tracking, tracking with BTC. The only issue that I have with, you know, being bearish on L1s right now is actually I think there's just a gap in the market for these things. Where if SUI continues to perform well, then it's a self-fulfilling prophecy. At some point, obviously it collapses, in my opinion, unless it gets real usage. Uh, but it's, you know, it, it's funny because the way that I view alts is they're providing a gambling tool for people and people want to gamble, and that's sort of the use case. And right now there's a, there's a missing there's a missing piece of that market, which is you think Bitcoin's going up, you want to outperform, you might coalesce around something like a SUI. I mean, if you look at SOL today, okay, BTC is up 3.5% and SOL is up 60 bips. One of the reasons I think this is, is because there are a lot of people that SOL is very institutionally owned, interestingly enough. And there are also a lot of people that did the trade. Yeah.

Now after FTX, a lot of that locked Solana is sitting on institutional balance sheets. It's like a weirdly tradfi trade.

And so I think as the market has softened, people are hedging out that risk because they, you know, if you bought it, if you bought SOL at a 40%, I don't even, I don't remember what the discount was and I don't know, but, you know, at a 40% discount, you probably want to lock that in rather than give it up if you see it start starting to come back down. So I think a lot of people are selling pops. Yeah. On SOL, and that has made it, you know, it's just made it a worse asset to trade from a, from a beta perspective.

It's not just, it's not like individuals that are doing this, it's investors demanding returns of their institutional, like basically the LPs are demanding of the GP, like lock in some profits, like return some capital to me, you know.

Yeah, on that, that, that is true. I mean, there's a, there's sort of a forcing function there to actually make, make sure that that hedging occurs. Uh, so I mean, as you know, I'm still of the mindset that BTC-D is on its way up. I mean, I was, I think that we could see mid-65 on BTCD before we finally top out. I think that there's actually a long, like, a long way to go. And that's because in general, there's— it's— I think it's very hard to generate a general alt bid right now.

That's the smoothest trend in crypto.

Yeah, it's a great, it's a great trade. I mean, you know, basically, I want to go back to the point and say that Uh, it's important to not always trade. You have to pick your spots very carefully, and you have to understand when you have edge and when you don't have edge. So for example, what I say now, hey, go out there and go buy a bunch of BTC and then short a bunch of alts against it. You don't need to put on that trade now. You can wait for the opportune moment. And sometimes the opportune moment doesn't come, but if we get a squeeze across the board of these shorted alts, then why not be there to take the other side?

Exactly. And I think that might be the best trade, is once again on pops, sell high. This is why I want to trade actively. Like, there's certain tokens that I want to put in the, you know, cycle bags, uh, bottom drawer, but other tokens that I think you could sell versus being long BTC as a pairs trade and you'll make money. I mean, one thing that kind of tickled me this week was watching— watching— I guess it wasn't this week, but like recently watching the Friend.Tech, uh, platform get rugged. You know, I think that over the next 2 to 4 years, we're gonna see a lot of alts get rugged, right? Like, not, not the good ones, but I think we're gonna see the I mean, like, let's say you're a dev, you've been in crypto for 15 years or 10 years, you're sitting on a wad of HBAR or Polkadot, which I love to hate, or name your crappy alt with— that's basically zero uptake and just vaporware. Yeah, they're sort of like correlation algos that will drive it higher when BTC ticks higher and it will kind of underperform. But eventually it'll just sort of go flaccid. And these people who are sitting on their bags, it becomes this like really awkward prisoner's dilemma where they're like, if I sell, then everybody else who's long is going to be mad at me. So maybe I won't. But if somebody else sells, then I lose everything. And I've been working on this for a decade. Like, I think we're going to see rug after rug after rug, FTX style or, or Baloo style, dollar sign Baloo style for those who remember.

That's so, that's the Honestly sad, but I wish I had my girlfriend here with me.

It needs to happen. It's like somebody needs some, like some of these coins just need to go away. Like the space.

I agree. I agree. I think one of the worst people in, especially in this space will constantly talk about how, you know, amazing the technological developments are and all the new crazy financial things that it can, that it can unlock. Uh, but I think in the same vein, not to, you know, I'm not going to get political, but sometimes progress isn't good. Sometimes there, you know, there's a, there's an old story. You, you're walking down a street and you see a fence there. Do you take down the fence? Well, why do that unless you know why the fence was there? I mean, maybe somebody smarter than you put it there. Maybe there's a reason the fence exists. I don't know. And one of the fences, I think, in the traditional financial world is the ability, uh, to force founders to hold value in their stock and not have a liquid market for getting rich before your product actually works. And that's actually still even changed in the startup world over the last 5 years. Uh, there's more of a market for this stuff, but that was actually a good thing that founders couldn't get rich before their company went public. And now the moment your token is live, you're public and you don't need to do anything. You just make a ton of money. And it takes a, you know, and I will say this to be nuanced. It takes a very driven individual, like an extremely smart, driven, motivated, and well-meaning individual to look at $25 million and say, I'm going to keep working hard. And that's why there are not that many entrepreneurs in this world. Right? Like, you know, you might live in a bubble where you think everybody's an entrepreneur, but the reality is if you put the vast majority of humanity in a position where they had this company and they were just gifted $25 million, would they keep working on it? Most people would not. Maybe not. I mean, we would, but I'm sure a lot of the listeners would, and there are a lot of people in crypto that do, but a lot of people wouldn't. And that's why you see these things, right?

Yeah. And what makes that even harder is that unlike normal startup equity where it's like, oh, somebody chips in a few mil at a $25 million— or sorry, some valuation that makes your stake worth $25 million and you're the entrepreneur. For every one of those, there's like a crypto project where the founder or the devs are looking at their, their positions, their liquid positions, and they say $25 million one moment. Then over the course of this summer, that number has gone from like 10 to 40, 18 times. And they're probably not right in the head at this point. I think what they're seeing is less what you and I see on a normal day walking down the street and more what you have behind you, which is just this weird fantasyland Wheel of Fortune, virtual Wheel of Fortune.

This is— there's a story behind this background, guys. So you see this as a beautiful Wheel of Fortune. If you're ancient like me and Jonah, you know what this is. You basically, you spin it and you get a prize, but you don't know what kind of prize you're going to get, you know. And the key here is to remember that if you're in crypto, you're probably going to walk out with a prize. If you invest in assets in general, any assets, you're probably going to walk out with a prize. You just don't necessarily know what time you're going to get that prize, or when you're going to get that prize, or how you're going to get that prize. Or what size it's going to be. And the key is to just stay alive. Make sure you can keep spinning, right? Make sure you don't blow up. Like, don't overinvest, don't go nuts, don't use leverage. Don't be that guy on the Binance Futures today who bought 8,000 Bitcoin and then puked it all in the span of 8 hours.

Why do people do that? What, like, I still don't understand.

That gets a bunch of spins on the wheel, so at some point you get your prize. I mean, here's the thing, Here's just, you know, about equity markets in general, right? The S&P 500 is made up of 500 companies. In aggregate, these companies are profitable. So what does that mean? That over time, as long as profitable companies stay in this index, you make your money. You make money. That's why equities go up. Equities go up because they make money. Like these things make money. There's a cash flow. So as time goes on, as long as there's no like World War III, probably the stock market gets to go up because it's comprised of things that make money. Um, same can't necessarily be true about crypto right now. However, however, as long as the equity markets go up over time, then people are going to want to bet on things that get them more return than that 5% a year. And so Bitcoin probably has a, has a spot. In that. Now, does anything else, as we've talked about, maybe not. So, you know, my, my best, you know, to turn this into something more actionable, my best plan for getting long this market is a clear breakthrough of all-time highs on equities or a clear flush on Bitcoin. That was my, that was my rant.

No, I love it. I mean, look, to your point, Sometimes there are just times where, like, we got— we take a lot of crap for this on Twitter. Oh look, it's Baloo!

Hey, that's the bear. It's the big bad bear.

Welcome, Baloo. His skin looks like a rug.

He is a rug.

Yeah, so I mean, basically, this is— people give us a lot of crap on Twitter because our podcast is called 1000x and they're expecting, I don't know, low market cap shitcoin shills that, that 1000x. That's not really what we're here to do. It's more about developing a process, uh, and lasting. Time in the market beats timing the market.

Um, yeah, you're not gonna 1000x your money, but you'll 1000x your knowledge. I can promise you that.

You might 1000x your money, like, if you bought GBTC, then rotated into Bowdoin, then rotated into ETH, like, you wouldn't be that far off.

Sure.

You know, so like it's possible but hard and you're not going to do it all in one coin. I guess my point is like during these times where it's just wild chop and there's no alt narrative, why dive in front of the altcoin bus, right? Like just, just like preserve yourself. And to the point of this guy or gal, Nashti, who wrote, man, I miss 2017 making money without mid-curving BS about rates and macro.

I—

there is an element of like, yes, you can just be long Bitcoin right now and probably pretty happy about that. But as you and I both know, Avi, um, complacency kills, right? What works today will not work tomorrow or next week. And if you're just blasé about your, your risk, watching the number go up and, you know, just saying, I'm so smart, I don't need to mid-curve things, you can end up losing your shirt. A lot of people lost it on FTX just like that. And, and I don't like the mid-curve meme because basically the, the implication is that analysis is bad, right? Um, and I don't know, I just— my career has run contrary to that notion for a long time. Like, just staying in the game requires thinking and rethinking.

Yeah, no, I mean, and research and analysis is extremely important. I mean, one of the highest alpha things that you can do for yourself in this particular market is go on to, go on to CoinGecko. I mentioned this before, but just go, go, go on to CoinGecko and actually spend 3 hours looking at each project that's below $100 mil market cap. Actually go look, right? Filter by $100 mil market cap. If you're, if you're like really looking for a real return that, you know, you're not just looking to gamble. You're looking, okay, I want to be able to find a 10x. That's how you find the 10x is you don't go on Twitter and look for what people are tweeting about. That's silly because by definition, if people are actually already tweeting about it, then it's probably priced reasonably effectively. It's better for you this person to like go look at what is actually being built out there that is low enough market cap. Do the diligence. Teams are pretty accessible. You can go into a Discord, send them a message most of the time, go into the Telegram, tag the founder, talk to them. Do you like their— ask them hard questions. Do you like their answers? Do you not like their answers? Right? And you can even narrow it down by sector. Go look at, you know, go down the list of every single DePIN project. See, see what they're about. Right. And that's how you get things that you can hold for a while and actually make some good money on. You know, I know we talk a lot about the majors here, but you offended my ego when you said, you know, we won't teach you how to also make money on other things.

No, I mean, we definitely have plenty of shitcoins left in the old cannon to be fired at appropriate times. But I think that now just isn't one of those times. Like, at least put it this way, not for me. I don't— I, I like the, um, like the top 50 coins. I don't like the sub-100, 100 mil FDV coins because I'm not a very good angel investor or venture capitalist. Um, I've tried and failed many times. Um, probably broken even, but that's kind of what you're looking at when you look at these low FDV coins, unless it was like the meme coin summer where something was just hilarious and you buy it for you know, 10 days and then sell it 3x higher, you know, or 10x or 50x higher in certain cases. Like a lot of these low FDV coins involve a product market fit that does not exist yet, right? They involve some vision of the future that may or may not come to pass. And that is an area where I personally feel less comfortable. That's fair. But, you know, you can listen to plenty of—

that is, that is how you, that is how you find these things, right? That's, that's the— I agree. And, you know, one thing that I'll say is you got to be good at it. But I think that probably holds true for everything that we say. You still have to be good. Like you can't start—

our secret is money, talent. That's, that's the secret. No, we, at least I don't have it.

You have to be really good. He's, he's really good. Baloo started peeing outside.

Yeah.

Really good.

Good for you, Baloo. You got rugged. You are a rug. You did.

Anyway, so this is actually a really good question, by the way. Uh, the one here, sorry. What is the difference between patience and complacency? You wanna pull that up?

Renly B. What is the difference between patience and complacency? Uh, I'll take a, I'll take a stab at that one.

Mm-hmm.

Patience is, uh, not doing anything while paying attention. Complacency is not doing anything while not paying attention.

What was the difference? I don't think you could, I don't think you could have said it any better. Yeah, that's honestly— that should like go on the wall in my office.

I mean, literally, like, when people are like, oh, it's a mid-curve take, or, oh, these guys— like, yes, sometimes there's no trade, there's no portfolio reallocation to do, but that doesn't mean you should tune out, right? Because then you'll miss— you'll miss the avalanche of flow that, you know, can either carry you out or take you to the promised land. And, you know, it's funny, like, I was talking to a guy who, you know, used to report to me back in the day, and he was saying, I want to be a crypto PM. He was like, what, what advice would you give? And my, my advice was just like, like, I tried to think about like the pithiest, most concise thing that I could possibly say. And I said, well, first of all, two-part advice. First, do it in your PA. Don't necessarily do it with trad fi or institutional guardrails because the volatility is too huge. But That aside, we already know that, like, you— there isn't always a trade, and you have to be paying attention at all times because this market just gets so violent. Um, you have to be very nimble about switching between periods of calm sideline, you know, watching the game, and then running onto the field and getting in the game.

100%. I think that's, you know, especially your point about doing it, doing it with your PA. I know we've discussed that, we've discussed it in the past, but that's like a hidden gem is it for, unless, you know, I think it makes a lot of sense for people that are involved, especially in crypto to not be super active traders and to just invest in, you know, in the majors, have a stable job, have cash flow, and then just allocate portion of your portfolio to this. Now, even if you're doing this full-time, right, like, let's say you start off that way and you start to figure out that you're really good, and you start to figure out that you've, you know, you, you're like, okay, wow, like, I really figured out how to trade this thing. I'm starting to make some, I'm starting to make some real money. I'm starting to figure out how to, you know, uh, how to trade. I've seen a lot of people try to go like join a crypto fund. And I think that's probably one of the worst things that you can do for yourself because one, access to people is so open and the ability to learn from people is so open in crypto that if you just, I mean, like DM Jonah, we have a group chat, like DM me, you're in a group chat of 1,200 people, some of whom are better traders than we are. And you can network if you can network effectively. Which you're gonna need to do if you want a job anyway, you can learn. And if that's, if you wanna focus on crypto, I think the caveat is if you wanna learn other things. Yeah. Maybe go, you know, you can go try to work at a traditional investment shop and do crypto at a traditional investment shop. And then at least you can learn the other things as well if that's what you want. But if you're just like, I want to trade crypto, I just wanna do crypto, guys, get in the chats, get active, talk to people, network, ask questions. Don't be, don't be afraid to be dumb.

Yeah, it's crypto is so bizarrely retail-oriented and accessible. Like, if you wanted to learn to trade gasoline, you could not hop on Discord or Telegram or podcasts and figure it out. Crypto, you really can. You don't need to do it institutionally. And I think—

so you're telling me if I called your old boss at Vitalik and I was like, hey man, so, um, how should I trade this oil thing? He's not going to respond to me?

Probably not. Probably not. I'm just going to leave it at that. Um, I'm still afraid of those people, so I'm just gonna say probably not. But what you can do, like the typical wealth management advice, like if you're scared, like, you know, you have a nest egg, maybe you're getting a little bit into your, into your life and you don't want to just like suddenly lose everything on an FTX-like event or some crazy nuclear sell-off, maybe, maybe it does make sense to apply the traditional wealth management advice of like 60% equities, 40% bonds, but like tweak that for your risk profile and maybe go like 60 to 70% Bitcoin, 30 to 40%, you know, things that you can sell when you need cash flow to fund your, you know, your dinners and your vacations and your, you know, your life, uh, so that you don't have to sell the Bitcoin. Um, rather than being— and then maybe instead of being 100% of your crypto allocation is Bitcoin, you know, not financial advice, maybe 80% of your crypto allocation can be Bitcoin. And 20% you can just be trading up a storm, doing, doing things that have nothing— that look nothing like the long-short equity hedge fund style trading that we often talk about. Like, there are many ways to make money in crypto. You can do pairs trading, you can do centralized versus decentralized arbitrage. I know a guy who built a meme coin bot that just sort of like gets in and out of those things somewhat profitably somehow. Mid-frequency trading, just like analyzing order books and getting in and out. Like, there are quanty things, there are not so quanty things. You could probably go and like like pick up the VC unlocks table and just pick the worst 50 of those projects and get short them versus long Bitcoin and be okay, right? Like there are all these little things that you can do with a smaller percentage of your portfolio so that you aren't the guy who literally just like comes in Leroy Jenkins style and goes like max short with 50x leverage on Binance and gets liquidated today for no fucking reason, right? Like you don't have to do it like that.

So damn, I wish, wish somebody had told me that before I liquidated my whole account. But anyway, Thank you for that. I want the one thing that, uh, we get, we're getting some questions here, two of which are kind of, kind of similar. Uh, it's interesting. What do you think about the FTM hype? Fade it or buy it? And then, uh, do you, do y'all buy this whole DeFi Renaissance trade that has been making the rounds on Twitter? I mean, these are basically the same question, and I know they're about completely different assets, but they're basically the same question. And it's that How sustainable are these short-term narratives? And the answer is not very sustainable. And the only way to trade these things is to trade them technically, in my personal opinion. So like for FTM, you can trade it technically. Uh, I don't, I don't believe that Andre is necessarily the most reliable person in the world. He could walk away again at any moment. Uh, FTM, like the team has been notoriously unreliable as well. It's possible that it goes up in a straight line because, you know, I think it's reasonably tightly held and it is generating, it is generating attention. Do I think in 3 years that FTM will be, you know, huge? Probably not. The way that you try to approach these trades is by estimating how many people are already in them. So there are 2 really good websites, Cato and Santiment, that allow you to track investor sentiment. And with these types of trades, if you look at like the volume of tweets and the volume of people talking about it and who's talking about it and where it's percolated, that is very, very helpful. So for example, if you see a 3x standard deviation increase in the discussion about FTM and it is accompanied by no increase in price, then you probably don't want to buy. You probably want to get out. If it's accompanied by a big increase in price and it's still growing, then okay, maybe you want to get in. Long story short is these are trades. These are not law. These are not investment theses. And so what you need—

I love how these are just like, this is just pure psychology with zero psychology, right?

And so what you need to do in these types of situations is, hey, you know, where am I? Am I in early? Am I early to the trade or am I late to the trade? Like, I mean, one, one example, which is kind of interesting, is that GameFi a lot of the volumes on GameFi, like IMX has been trading up. ILV has been, you know, it's actually been like trading reasonably well. Hasn't made a new low. These things are starting to get a little bit of traction right now. I don't know if I'm— I don't personally, I don't own any of this stuff. It's a bit too small. For me to punt, for me to, for me to punt around. But it's things like that, like look for increases in, increases in volume off of like complete low. Oh, this might be a narrative. So, but by the time you get on here and you ask me, hey, FTM, DeFi Renaissance that everyone on Twitter is talking about, it's just tough for me to trade that. Uh, you know, again, these things could 2x. With the DeFi specifically, it's that there's no there's no real new innovation there. I think that, uh, I think that what's happening right now is that there's interest because of the Trump DeFi project, but at the end of the day, there's no new innovation. The best assets are going to be the ones that institutions can come into and tokenize their assets on. Uh, so if you want to bet on that specific thing happening, then obviously you can find assets, but I think DeFi in general is not necessarily my favorite thing right now.

Aave is just eating the rest of DeFi alive. And you can probably extrapolate that occurrence onto many other subsectors of the altcoin space. Like, I do think that there will be winners in some of these sectors. I do not think that you need 6,000 different protocols that will let you stake your ETH and then borrow and lend against it, right? It's the best player is going to win, and then the rest are going to kind of fester, and then they're just going to start getting rugged one after another. So I do think that DeFi is important. Uh, I know some people from, you know, some people I'm very close with in the market, like, have active partnerships with Aave, use that protocol for TradFi purposes. Like, it's, it's real, it's growing. The UX is incredible. It's like one of the few things in crypto to be excited about. But yeah, DeFi is a space. Like, do you need to be long DeFi on Fantom? Do you need to get long the token for Tonic, the DEX on Near? Like, no, you don't, right? So maybe this is about selectively picking winners rather than getting excited about narratives. I mean, I guess what else should we talk about? We talk about ETH, we can talk about Solana, we've talked about AI, talked about other sectors.

Talked about a lot. I don't know how much more you want to, you want to cover here. I mean, if we have any questions from the crowd, we can go through them. You like Solana? No, we talked about that. ETH is the XRP of this cycle.

I still hold ETH in my portfolio, says Mr. Guts.

Are you okay?

Should I seek therapy?

Are you okay?

We're here for you.

I don't think you— look, guys, just a quick PSA. If you hold ETH in your portfolio, give me a call. I'll talk you down. It's okay. You know, not everyone's intelligent, not everyone's beautiful, not everyone's smart. It's okay. You'll live. Just get rid of it.

Can we discuss Internet Computer?

That was probably the bottom for ETHBTC. Let me go look at the chart.

Yeah, it did bottom out. I saw it kind of perform today. I was like, this is different. This feels weird. What's going on here?

Oh no, it's getting, it's getting, it's getting smacked again here. Interesting. Yeah. I mean, look, I, the, the issue again, the issue with ETH is that, and we've talked about this on a lot of different pods, but it's just cannibalized. It's just been cannibalized. It's just getting eaten. Yeah.

Even Vitalik looks tired.

It's, you know, everybody, everybody looks really, everybody looks tired. It's not, it's not new. It's not sexy. It's not interesting. The one saving grace. For ETH. I'll make a bull case if I have to, is that as yields come down, it looks better. It looks a little bit better as yields come down, and it does have at least some yield. Uh, and if that narrative takes hold, then it becomes stronger in a way that Bitcoin doesn't, because As people buy ETH, people tend to use ETH more, and then ETH actually goes and becomes deflationary. So there is a reflexive loop to ETH that BTC doesn't have. Unfortunately, that's true to the upside and the downside.

It is weird what you just said. Like when somebody was trying to sell us a Twitter handle, they offered it in ETH. ETH is like a bizarre, like anarchist internet currency. In a way that others aren't, you know?

Yeah. Yeah. I think it's just, I think it's just like everyone, like every, every single person in crypto that you want to interact with has an ETH wallet.

Yeah.

I mean, yeah, I have an ETH wallet. I mean, I, it's not like I hold zero, literally zero ETH. I've been in this industry for long enough. I have like 350,000 MetaMasks and some of them have ETH in it. Right.

Like, and maybe that's enough of a moat.

Avi.

Yeah, maybe that's, that's all you need. It's not the best tech that wins sometimes. It's just the tech that everybody uses.

Yeah, that's, it's a, you know, reasonable, reasonable, reasonable point, Oil Man.

Like beepers. People still use them.

People still use beepers. I thought only— anyway, moving on from that. Moving on.

Is there anything else for tonight? I'm sick. I'm sick as a dog. I like, I didn't, I haven't left London. I didn't go to this stupid conference where everybody always gets sick and I'm just sick anyway. So I think I'm going to hit the sack here. I'm pretty tired. Love talking to you as always, Avi. None of this is investment advice. Again, we're just pontificating here.

I'm not shushing. I'm shushing the dog.

Shut up, Toda.

No, no, no, no, no. Keep going. Keep going.

That's all.

That's all I had. I don't know. This is, this is great as always. Uh, good having people come in with questions. Good shitposting with you. We'll catch you again soon.

Talk to you soon.

Thank you.