It’s hard to be cool when you’re also the teachers’ pet? I managed okay. No, I’m kidding… I was never cool.
I’m curious whether the “vibes” argument applies to Trump, and to politics more broadly? In 2024, Democrats’ messaging on the economy seemed to run into exactly this problem: saying the numbers were good didn’t matter much when the public vibes said otherwise.
The argument for bitcoin has always been the same: (1) store of value, (2) medium of exchange, (3) speculative asset. The best case is #3. And I couldn't agree more about the lack of fundamentals and "interest" or "vibes" being the sole argument as to why the price fluctuates.
When I was at JPM, we jokingly said internally how crypto was something you did for fun. But the unfortunate truth, tactical and strategic investing is often boring af
Well put, Ed. I just wonder what will happen when the new kid (AI) eventually starts losing his charm. Will the old nerd look like an attractive plan B?
The perp datapoint may be doing more work than the vibes thesis. With 70% of volume in perpetuals carrying almost no leverage cap, funding and forced liquidation produce exactly this signature in both directions without requiring sentiment to change at all. Worth noting too that the absence of cash flows removes a ceiling as well as a floor, which is why prior drawdowns of 77% and 85% preceded new highs rather than the end. Unanchored cuts both ways.
Funny, was chatting yesterday about the obliteration of my Crytpo "portfolio" and how it was because the kittens had noticed the new AI ball of string. This article is a much better empirical argument as to what's happened!
Working as I do at the apex of AI building and AI adoption, I do wonder when the bubble will deflate on AI. Like SaaS every person and their dog has bought the tools and almost nobody is using it properly (50% SaaS purchased remains firmly on the shelf, 95% AI projects failing Source:MIT), so at some point the CFO will be asking WTF is the return on all that investment.
This is the issue with any ‘hard’ asset as investment: it generates nothing and rises or falls solely on the basis of perceived value. What you want is a generally accepted long term store of value that hedges inflationary risk and hopefully goes up and to the right. Crypto is not that. It is something that someone made up and that people with an interest in pushing up talked up. It has no real benefit or use and no lasting value. Ask any mouth breather who bought a Trump coin.
Surprised you didn't mention the rise of GOLD in all this. Arguably, also something of a vibe market, but cause central banks artificially hoard the thing, it does have a floor..and a marginal buyer.
Spot on, as always. BTW what ever happened to NFTs 😀?
I have to assume the entire Bored Ape Yacht Club are billionaires at this point, no? We were assured they were the best investment going at the time!
they're S O L
It’s hard to be cool when you’re also the teachers’ pet? I managed okay. No, I’m kidding… I was never cool.
I’m curious whether the “vibes” argument applies to Trump, and to politics more broadly? In 2024, Democrats’ messaging on the economy seemed to run into exactly this problem: saying the numbers were good didn’t matter much when the public vibes said otherwise.
Since I always suspected bitcoin was a ruse, the most ‘interesting’ thing I learned from this read is that Ed is, or was, a magician.
The argument for bitcoin has always been the same: (1) store of value, (2) medium of exchange, (3) speculative asset. The best case is #3. And I couldn't agree more about the lack of fundamentals and "interest" or "vibes" being the sole argument as to why the price fluctuates.
When I was at JPM, we jokingly said internally how crypto was something you did for fun. But the unfortunate truth, tactical and strategic investing is often boring af
Well done, Ed.
Dumb wannabe take
“Wow you are so smart”
I said what you wanna hear
Digital fool's gold??
Well put, Ed. I just wonder what will happen when the new kid (AI) eventually starts losing his charm. Will the old nerd look like an attractive plan B?
When clear thinking is matched with clear writing, it is something beautiful. Very nice work.
The perp datapoint may be doing more work than the vibes thesis. With 70% of volume in perpetuals carrying almost no leverage cap, funding and forced liquidation produce exactly this signature in both directions without requiring sentiment to change at all. Worth noting too that the absence of cash flows removes a ceiling as well as a floor, which is why prior drawdowns of 77% and 85% preceded new highs rather than the end. Unanchored cuts both ways.
Ed at 14;
https://youtu.be/Qx6sPRlcafA
Damn Robert, TACO and now Brotation. Leave some catchy names for economic events for the rest of us.
Funny, was chatting yesterday about the obliteration of my Crytpo "portfolio" and how it was because the kittens had noticed the new AI ball of string. This article is a much better empirical argument as to what's happened!
Working as I do at the apex of AI building and AI adoption, I do wonder when the bubble will deflate on AI. Like SaaS every person and their dog has bought the tools and almost nobody is using it properly (50% SaaS purchased remains firmly on the shelf, 95% AI projects failing Source:MIT), so at some point the CFO will be asking WTF is the return on all that investment.
This is the issue with any ‘hard’ asset as investment: it generates nothing and rises or falls solely on the basis of perceived value. What you want is a generally accepted long term store of value that hedges inflationary risk and hopefully goes up and to the right. Crypto is not that. It is something that someone made up and that people with an interest in pushing up talked up. It has no real benefit or use and no lasting value. Ask any mouth breather who bought a Trump coin.
Surprised you didn't mention the rise of GOLD in all this. Arguably, also something of a vibe market, but cause central banks artificially hoard the thing, it does have a floor..and a marginal buyer.
Vibes are back