Here We Go Again

One year ago today, the price of bitcoin was close to $90,000, and sentiment was ecstatic. The price of bitcoin would carry upwards to $100,000 for the first time over the coming weeks, and 6-figure bitcoin became a reality.

One year later, bitcoin has fallen below $100,000; at the time of writing is around $96,000, and sentiment has never been worse.

This is not where the price of bitcoin was predicted, expected, and predetermined to be by any and everyone.

$444,000 in early November was the prophecy of Josh Mandell.

Numerous banks issued proclamations of $175,000, $225,000, or $250,000 per bitcoin by the end of the year.

Samson Mow talked about God candles, Omega candles, and $1,000,000 per bitcoin by 2026, not only being in the realm of possibility but in a realm of reasonable ability.

Why?

Why then are we roughly back where we started a year ago?

Bitcoin zigs when we expect it to zag.

Countless macroeconomic factors could be influencing the price of bitcoin. The longest ever government shutdown holding back economic data. Uncertainty about interest rates and job reports. A potential AI bubble. Tariff conversations led by the current administration. Potential wars in the Middle East, Venezuela, and Taiwan. Continued conversations of CBDCs and surveillance in the EU and other parts of the world. The price revival of Zcash and the privacy-focused conversation that accompanies it.

I could go on and on.

I will go on to emphasize 3 key points before continuing:

1. Education about bitcoin is key. Know and understand the scarcity you hold. Education also helps you take the emotion out of the bitcoin price.

2. Do not overleverage yourself in the short term. Bitcoin is known for volatility in the short term; the longer your time horizon, the more you are protected.

3. In every cycle bitcoin has gone through, there have been many price pullbacks of 20, 30, and even 40%.

Writing this, I would be lying if I said my ego is not a little hurt. I, like so many others, am confused and surprised by the current price. I expected much higher prices at this current time. However, I do still remain 100% convicted and grounded in the knowledge of what bitcoin is, and where I think bitcoin goes into the future.

In an ever-increasingly global and digital world, the logical base case for bitcoin is for it to pass the market cap of gold.

With this base in knowledge and my core belief unshaken, I recognize that a near-term price compression is only good for the long term, and especially good for investors at the retail level. You have the opportunity to trade your dollars—a currency that will never stop being inflated—for more bitcoin. A reminder that when corporations and governments decide to dedicate portions of their balance sheets to bitcoin, they do not care about what price they buy, they only care they have it.

Continuing to potential reasons for why we are seeing the price compression and contraction of bitcoin, I recently read a very compelling argument by Jordi Visser that discusses the idea that bitcoin is experiencing its “IPO” moment. The analogy Jordi uses compares the price action of bitcoin to the price action of stocks who IPO. When stocks IPO, they tend to go higher, and then come back to earth. This was the case with Amazon, Microsoft, Facebook (now Meta), and recently Circle and Figure. The reasoning is that early investors have an opportunity to cash out for profit, and many of them do. Meaning, in the early stages of the public life of a stock, there is consistent and immense sell pressure compressing and pulling back the price of the equity.

This relates to bitcoin because over the last couple of months, there has been immense sell pressure from early investors in bitcoin. Jordi identifies that OG bitcoin holders who have held from prices of $100 or less, even prices in the $1,000s to now, are cashing out because, for the first time ever, they can do so in a market that will largely absorb their sell pressure.

Imagine holding 100 bitcoin you purchased at $100 to over $100,000… How would you feel? What would you do? Can you imagine sitting on life-changing wealth for generations of your family, the pressures you would feel?

The reality is many OG holders have sold and cashed out large portions of their stack.

We also saw a $9 billion, yes billion with a B, sale on Galaxy in July.

I think the IPO analogy has merit and do believe it’s good for the long-term vision of bitcoin. Moving holders from people who have a cost-basis of $100 to $100,000 is better for any asset because it is a distribution of where the holders are.

As for everything else, I cannot predict the future, and I cannot specify any single reason why the price of bitcoin is what it is today. What I can say is the fundamentals have never been stronger for bitcoin. I know the ego hurts in the short-term, but if you believe in the future of bitcoin then the price today is a blessing.

That is just reality":

The adoption arc continues to rise. There is speculation that banks will add bitcoin to their balance sheet in early 2026.

Block, Square, and CashApp continue to build arguably the best vertical stack of bitcoin products in the world and continue pushing the mission of making bitcoin money forward.

It pays to zoom out and trust the process.

Stack SATs.

More food for thought :

Originally Posted November 15th

The views and opinions expressed here are for entertainment purposes only and should, in no way, be interpreted as financial or investment advice. Always conduct your own research when making an investment or trading decision, as each such move involves risk. Nothing contained in this e-mail/article constitutes, or shall be construed as, an offering of financial instruments, investment advice, or recommendations of an investment strategy.