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James Check | Reading The Bitcoin Market | Simply Bitcoin IRL · Simply Bitcoin

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Yo, how's everyone doing? Welcome to another episode of
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simply Bitcoin IRL. Today we have a very special
0:07
guest. We have James check in the
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house. He his Twitter handle.
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He goes by the name of at under score check matey.
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I'm sure you guys have seen him around.
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He's did some incredible he he's done the podcast circuit and
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he's had some incredible episodes on other podcasts.
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So very excited to have him on the show today.
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He is the here it is the founder and lead analyst of Check on
0:32
chain.com. Incredibly awesome platform.
0:36
It's helping investors navigate Bitcoin's volatility like a pro.
0:40
So we're going to get into just what is the market cycle
0:44
expectations, all of that good stuff.
0:46
But before we do it, I do want to give a very special shout out
0:49
to the Bitcoin company that makes this show possible.
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It's really awesome. Anyways, go check out
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bitcoinwell.com today. No more delay.
1:20
I do want to bring up James on stage.
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James, thank you so much for joining us, man.
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Like I was saying in the beginning, just huge fan of, of,
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you know, the podcast appearances you've done so far.
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And of course, you're proof of work that you post on Twitter as
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well. So appreciate you coming on the
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show today. Thanks and me on mate, should be
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a fun discussion. Absolutely.
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All right, man. So let's jump straight into it
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and kind of address some things that I think are interesting.
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So 1st, I'm going to start off with, and this is what's popular
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these days. This is what people are talking
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about is the power law. And I know that you are not a
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big believer in the power law. And I was just wondering like,
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why is that? Like, and again, this isn't,
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this isn't just some random, you know, Bitcoin pleb from Twitter.
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This is someone who dedicates his life to, you know, making a
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living off Bitcoin analytics. So what is it about the power
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law that you don't like? Yeah, so it's not so much, I
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don't, I don't like the power law.
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I don't like the way the power law is being sold and the
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implications from a small social perspective.
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So look, there there's, I mean, I'm an analyst.
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I do a lot of work in terms of trying to understand the
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mechanics of what the market's doing and all these types of
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things, right? And there's a lot of statistics
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and mathematics and all sorts of things we can throw at it.
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As with all things, some models are useful, right?
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Most of you know, they're all models.
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We have to understand there are a simplification of the world
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and you know, with the power law, it's just it's very similar
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in the same vein as stock to flow where it's basically a
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model that just says up only. And in in many ways it's like,
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OK, that's that's that's kind of cool.
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It's up only, but the problem is that there's a lot of people who
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don't do the proof of work, right.
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They don't they look for analysts and people who've done
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a lot more work than them. And again, I'm not I'm not
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dumping on the on the on the power law because there is a lot
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of work that's gone behind it. There's no, no doubt about it.
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Quite different to the stock to flow model where there was very
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little work done behind it and the work that was done was
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proven to not be very good. But my fear is that the the
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outcome could be the same where you end up with a situation
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where people just they make decisions because they think
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that the model is going to be preordained to happen, right?
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In some ways it can be so simple that it becomes dangerous, if
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that makes sense. So look, it's just one of those
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things where it's more so the way it's being sold now there's
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some interactions that I see where it's, you know, it's a bit
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more constructive and they're talking about the mechanics of
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how the model works. There's some other interactions
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where it's like, no, it's preordained.
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This is what's going to happen. It's divine from God number go
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up. It's going to follow this line
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and the concern of that is that people are going to make
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decisions that in 2021 blew them up, right?
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They went mega long at the top because the stock to flow model
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said we had to go from 60 to 100 and we went to 29, right?
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And a lot of people lost a lot of money there.
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And that's, that's the part that I'm concerned about because I
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had to go through a big process of helping rebuild, right?
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Because a lot of people put stock to flow in the bucket of
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on chain, right? That this is a big part of it.
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They put, even though it's not on chain data whatsoever.
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There's nothing about it that's on chain.
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It's like some simple statistics.
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A lot of people bundled the whole on chain industry in there
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and said, oh, look, it's all voodoo.
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It's all bullshit. So I went through a very, very
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long process of rebuilding and showing people, hang on a
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second, there is actually value here.
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And that's why I'm saying with the power law, they could very
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well be valued. Just be really careful how you
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pitch it because that's what catches people and that's what
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can cause damage. Gotcha.
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OK. And then what, what is it like?
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And again, I don't have a mathematics background in any of
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that, any of that stuff. But just to add to your point,
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that was the general and it's something that people forget to
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understand about markets is that it tends to do the exact
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opposite of what the majority of people think is going to happen,
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right? Yes, Like the psychology of it
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catches you every time. And it comes actually from a it
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comes from human psychology. We are trained from a very, very
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early age to avoid risk. Your mom says don't fall off the
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swing. She says don't eat that thing.
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Don't put that rock in your mouth.
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There's all these things that we do to we're trained to avoid
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risk and human beings, we are not good at markets by default,
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the default position. You've probably experienced
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this, right? You buy Bitcoin, you hold it.
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The moment you buy it, it sells off.
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You hold it. You hold it, hold it and finally
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go, oh shit, it's going lower and you just like you panic sell
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and then it rips all the way back to your cost basis.
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You buy it again, it sells back. We are designed to lose in
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markets and that is why when everyone's doing the same thing,
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it generally markets do not adhere to your expectations.
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And in many ways that the challenge with power law and
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stock to flow, the input model that they're using is time,
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right? Because stock to flow, we know
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that Bitcoin supply curve is pre pre set.
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So we essentially by modelling Bitcoin's price by supply,
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you're actually modelling it by time.
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And the power law is basically saying over time, it's just
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going to go up. And the problem is that like,
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that's not necessarily true. What if Bitcoin doesn't go up?
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What if it goes sideways or up or down or left or all of these
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things? Time is not an indicator that
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Bitcoin's going to go up. And it's lazy thinking.
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And that's my concern with it. Yeah.
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And, and, and I just wanted to ask you again, James, right this
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and again, I don't have the background that you do, but the
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vast majority of all right, hold on, am I back?
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All right, sorry guys. There's a thunderstorm outside
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and it seems like it's making things go crazy.
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I am back. OK, So James, going back to what
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we're we're we're saying what you responded.
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This is the consensus that I'm seeing this trend.
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OK So last trend it was 100K for a fact this trend because people
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have PTSD from the last cycle. I'm seeing a general consensus
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of an underestimation of the potential Bitcoin outcome in 22.
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Commissioning returns is consensus.
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Correct. Diminishing returns.
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So, and that is, I think it's, I think it, it's taken a lot of
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light out of people like it's kind of this motivated.
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People are people are leaving because they're bored and we're
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like 5% off the all time high. It's amazing.
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It's actually an amazing phenomena, but this is very
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real. Boredom shakes out as many
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people as downside. People just get bored and they
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eventually go, It's not going anywhere.
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It's topped out and they walk away.
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But what's really interesting is this current market structure
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we're in is what I call quiet and trending.
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It rallies and it goes sideways. It rallies, it goes sideways.
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It's beautiful stair stepping patterns.
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This is an extremely constructive bull market.
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Like this is what it looks like when you're building support on
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the stairs higher in 2021, if you can think back, we just like
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rocket ship from 10K all the way to 60.
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It just went vertical. There's no support there.
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And we filled the whole thing back in over the next year and a
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half. So we're building a very strong,
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stable, quiet and trendy price action.
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It's it's really, really healthy.
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We're building a foundation for the next leg and people are
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getting shaken out 'cause they're bored.
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It's it's an people are always wrong.
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This is how the markets work. It's a beautiful thing.
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Yeah, it, it, it's, it is a beautiful thing.
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And I think if you wreck yourself a couple of times.
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Oh, yeah, it's my eighth year. No, it's, yeah, it's my eighth
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year in Bitcoin, dude. Like you, you, you go through
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some stuff, right? You experience some things,
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emotions. And you can't learn it by
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reading it. You have to actually lose the
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money. You have to lose the money, you
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have to buy at the wrong time, sell at the wrong time, like pay
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your tuition. Otherwise you just don't learn
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it. Dude, it is unavoidable.
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It is like unavoidable. Like you have to go through it.
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It's like part of the part of the process and it's good for
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you. Yeah, I, I would say it's good
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for you and it, and it gives you your stripes as a bitcoiner for
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sure. So look, so I agree, I can't
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come at it from a level of expertise, right?
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I'm a media guy. But I can come it from a level
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of I've been in here 8 years. My intuition is telling me, you
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know, red light just because I've seen this play out before.
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And it's exactly what you said, the narrative this cycle.
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And I saw American Huddle talk about it the other day, is the
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diminishing returns cycle. So the diminishing returns
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narrative, you know, bitcoins going to 2X from here, that's
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it. The law of big numbers.
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Why the law? Why is the law of big?
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Like isn't it theoretically harder for Bitcoin to 2X from
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here than it was for Bitcoin to 2X from 10K to 20K?
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If that's the case? Like if it if it takes a lot
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more money for Bitcoin to 2X, then wouldn't diminishing
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returns come into play? Like is it diminishing returns
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compared to the last cycle or you just not a fan of
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diminishing returns at all whatsoever?
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No, it's a great question. And it's not so much that like
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the the law of big numbers is true, right?
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So as an object gets larger, it's literally got more inertia
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and weight. It's harder to move.
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So let's think about who is going to be selling this cycle,
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right? There are going to be people
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like yourself who've been in the market for 7865 years, long
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enough that their Bitcoin nest egg has gone from a, you know, a
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couple of 1000 bucks on the side.
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You know they've done that every single week, every month they've
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kept chipping away and keep, you know, dollar cost averaging.
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It's if we go up another, you know, 5X2X, we start talking
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about like, Hey, I can actually finance that house now that I
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wanted, or I could actually like change my life.
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I could put my kids through private school.
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The market is going to have to finance bitcoiners lives, right,
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Which is fine because it's it's about, you know, buying an asset
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early. So the asset gets bigger, but
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also it's going to have to finance everybody's life.
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That's that's kind of how markets work, right?
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Some people buy stocks early, they ride the wave and then the
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market when it goes to an IPO, right, That's when you get the
11:16
financing of those people get an exit and they obviously do
11:19
something with that cash. So there's this process of the
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the market gets bigger, but simultaneously the money coming
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in also gets bigger because you know, we're talking about, I
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mean, I did a report the other day and you may have seen that
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Wisconsin, I think it was Wisconsin pension fund and they
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allocated $180 million, which for you and IA $180 million.
11:39
You're like, shit, that's a lot of money, right?
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But to these guys, it's point 1% of their portfolio .1 right?
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We're talking about nothing. This is what they just like tap
11:49
a toe in the water. So and they're expecting to get
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up to like one 2% and that's one institution, one single
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institution putting point 1% is $180 million.
12:00
But here's the other crazy thing, $180 million, right,
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relative to Bitcoin's 1.4000 thousand million, right, $1.4
12:11
trillion market cap is enormous. So there's this like, you know,
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the, the, it does get bigger over time.
12:18
It does take more money to move, but simultaneously we have
12:22
bigger money coming in. And that's where I, for me, I
12:25
really look at like, I don't have a, a view on whether we're
12:28
going to have necessarily diminishing returns, higher
12:31
returns, whatever it is. When I look at the market, I'm
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like, OK, just let's have an assessment where we are right
12:36
now on the hard right edge, How is the market performing?
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And right now we're a stone's throw from all time high.
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We haven't had a 20% correction since the FTX bottom.
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People are bored and eating themselves on Twitter.
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And it's some of the healthiest price action I've ever seen for,
12:52
for Bitcoin ever. So and I, and, and so far all
12:55
the metrics I look at where I'm trying to look for things, what
12:57
I call top heavy markets. And this is what my audience
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will often hear me talk about top heavy markets when too many
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people buy too many coins too high of a price.
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And that's what precipitates a bear, right?
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You get markets sell off and they start to panic.
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I haven't seen any of those picking up yet.
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So essentially, we're at this point where it's like, it looks
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really, really healthy to me. And, you know, there's a whole
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stack of people who are quitting and leaving because they're
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bored and they think it's over. And yet it looks about as good
13:22
as it's ever looked. Yeah.
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And, and I agree with that. I agree with that.
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I, I, I, I feel what I felt before heading into 2021, we had
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that like, you know, kind of like this fake pull up.
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I think we went from, it was like 3.5, we hit 14 and then we
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went back down. What I think it was like, like
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what was it like six or nine or whatever that, that was the 21
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that was before. But it, it kind of reminds me
13:48
that was the mid cycle peak. And I'm like, OK, this is the
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mid cycle peak. I was actually concerned that we
13:55
were going up at the pace that we were going up and I was like,
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things need to cool down like for.
14:01
A nice game was formative for me as well because that was the
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first moment I realized, holy shit, I didn't buy anywhere near
14:07
enough. It was that first like moment
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where you're like, oh man, this thing when it runs, it goes.
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Yeah, it goes. It goes, right.
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So yeah, man, I'm, I'm, I, I feel I, I completely agree.
14:19
I think fireworks await us. It's just a couple more.
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The more it crabs, the longer it crabs.
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It's good thing 'cause it's building this.
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Yeah, it's building this base 100%.
14:30
And you may find, like I, I, I often encourage people to like
14:34
observe your own psychology because really markets are about
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markets will do their thing. It's like the tide.
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You can't wish the tide was different.
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The tide just is. What you have to do is learn to
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like observe how you respond to that tide, right?
14:48
So as we sideways crab for me, something I've observed for
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myself, it's $100,000, right for Australian Aussie dollars.
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So that's the current price level.
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Anything that goes under 100,000, I've like acclimatize
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myself to be like, well, OK, I'm never getting 80 or 60 ever
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again. That's gone.
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So I've acclimatized myself personally.
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So if it goes below 100, I'm in stacks stack mode.
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If it's above 100, I'm just going to wait and just let it
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see if it comes back down. So like I, I'm getting to the
15:15
point where I've, I've acclimatized myself to this new
15:17
level and that's what crab markets do.
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Some people like I'm experienced in markets, so I can probably
15:23
get to that acclimatization sooner.
15:25
Others it takes them a long time, right?
15:28
But if you've got these pension funds who are allocating for the
15:30
first time, $100,000 Aussie is the first price they're buying.
15:34
That's, that's their first level, right?
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So, so they're going to be very sensitive to it, but over time
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they're not gonna care because market's gonna go higher and
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they're eventually gonna be up and 100,000's gonna have seemed
15:44
like a dream, right? So it's it's very interesting
15:46
dynamics. Yeah, I 100% agree, man.
15:49
Man, you're making me bullish. You're making me bullish.
15:51
OK, so I I do want to pull this up because it's actually saying
15:56
this tweet. I don't want to say it went
15:58
viral but let's say it got attention and I said the the
16:03
Chinese mining ban robbed us 100K last cycle.
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Still don't see enough people talking about this.
16:08
What's interesting is you commented the Chinese mining ban
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had nothing to do with it in my opinion.
16:14
The 661 K spot bid from GBTC went to zero in February 2021
16:20
and every man and his dog were levered levered long at the top.
16:24
The market was already top heavy and bare ready well before China
16:28
banned mining. So Yep, and you're looking at
16:30
this and you're like, OK, there must be some type of
16:32
correlation, but you're, you're basically making the argument
16:34
that it, this is a coincidence, correct?
16:37
Correct. So, so markets will often look
16:39
for just like a catalyst. Now that you'll see this in
16:42
financial media, in financial media, and this is the same in
16:45
stocks and Bitcoin and everything at the moment, when a
16:48
market sells off or rallies, the media company will go and get
16:52
their intern and say, right, you need to go and find out why this
16:54
happened and just put a story out.
16:56
And you'll see that every media headline will just be like, oh,
16:58
look, Elon tweeted about this thing.
17:00
Oh, look, China banned mining. So market sold off.
17:03
They will find the the closest and easiest, most tangible thing
17:07
because it will make you click on the article, right?
17:09
But they're not doing the actual like, you know, they're not
17:12
doing analysts, not an analyst sitting there analyzing the
17:14
market being like, oh, here's the actual mechanics.
17:16
So if we go back to that 1st 2021 peak, let me just describe
17:19
what was really going on. We had we, I mean, as I said, we
17:23
went from 10K to 64 in like 4 months, right?
17:25
It was just an absolute rocket ship.
17:28
Now the, the actual all time high, and I believe that first
17:32
all time high in April was like 64,000 when Coinbase did their
17:35
direct listing. That in my opinion was the
17:38
market all time high. Even though we set a higher
17:40
price one later on, that was a real false top.
17:43
And I can talk about that later on.
17:45
But if I describe the mechanics, we saw what I call the on chain
17:49
top in about January. And the on chain top is when a
17:52
lot of metrics signal that the old hands, right, long term
17:55
holders, the Hodlers, they sold an absolute gargantuan amount of
18:00
coins on the rally higher from 20 all the way up to about 60.
18:04
But January was the all time high and that's when we had an
18:07
initial correction from like 42 to 29 and then we bounced higher
18:10
from there. But during that process, GBTC,
18:14
right, it was, it was trading at a premium.
18:16
So people may not know that this existed, but GBTC before it was
18:20
an ETF was what's called a closed end fund, which means
18:23
coins can go in, but they can't come out.
18:26
Now at at the time it traded at a premium.
18:29
So you could send one Bitcoin in, sell it for the equivalent
18:33
of like 1.1 Bitcoin in six months time, cash out and then
18:38
use that money, buy 1.1 Bitcoin and then get, you know, you just
18:41
keep adding 10% or whatever the premium was.
18:44
You keep compounding those returns.
18:46
A lot of firms did this with leverage.
18:48
So they borrowed money and then they borrowed Bitcoin to do this
18:51
GBTC trade. So 661,000 Bitcoin got sucked
18:56
out of the supply. That's a huge amount.
18:58
By the way. That's like, I mean, that's why
19:00
people like, oh, these ETFs are brand new.
19:02
It's like, Nah, we've seen these ETFs before.
19:03
GBTC was the ETFs back in 2021. This is the second time we're
19:07
watching this movie. So all those coins between like
19:11
December and I think it was February, all those coins,
19:16
661,000 float in, they can't come out.
19:20
But that's a huge spot bid. And that went to zero.
19:23
The moment that the GBTC went from a premium to a discount,
19:26
people will no longer buying the coins and sending them in.
19:28
So that enormous bid just eviscerated gone.
19:32
So suddenly the market's got to deal with the fact that it's
19:34
like, well, not only do we have no more spot bid, but we've kind
19:38
of teleported and built no support on the way higher.
19:41
And then you got a whole lot of people who are levered up and
19:44
now shitting themselves because their leverage position has gone
19:47
from a premium to a discount. They're about to get blown out.
19:51
Now you've got a problem. So then Coinbase, right?
19:54
They had their direct listing. And when I say top heavy, what I
19:58
mean is too many people bought too many coins are too high of a
20:00
price. There were a lot of people
20:02
listening to Stock to Flow specifically.
20:05
And believing that we were going to 100K and they had their first
20:09
ever cost basis at 55, at 60, at 6162.
20:14
And we can see it the moment that the price sold off after
20:17
the Coinbase IPO in April, the market was what I call top heavy
20:21
unrealized losses ripped higher coins in loss went up like we we
20:26
could. We can see that there was a lot
20:27
of people who are very price sensitive with a very high cost
20:31
basis and those people are also inexperienced.
20:33
A lot of them is their first cycle.
20:35
This is what tops look like. Hodlers have left, new money is
20:39
in and new money is in a really unfavourable position.
20:42
And then the market sells off. Then in May we had the Chinese
20:46
mining ban and the market, all it needed was a tiny catalyst to
20:50
just set off the match right, That they'd already built the
20:53
fireplace. The the fire starters are in
20:55
there. It's, you know, they've poured
20:56
petrol on it. That was just the final match
20:59
that just set the whole thing off.
21:00
Right? So, so did the did the match
21:02
create the fire? No, the fire was already there.
21:05
It just needed the spark. That is fascinating, man.
21:08
Bro, this, this is great context and I, I love the way that you
21:11
describe essentially the psychology of the psychology and
21:15
who the investor is that's participating at that time in
21:18
the market. Now my question to you James is
21:23
what do you, what date are you seeing like this is data from
21:26
your website, Are you releasing a newsletter like where are you
21:29
getting this from? Yeah.
21:31
So my website check on charts dot check on chain.com, but
21:35
you'll find it at check on chain.com.
21:36
That's actually been around for a long time.
21:38
I think it's one of the oldest on chain websites because I
21:42
started building it back in 2018.
21:44
I think it's like block height 538,000.
21:47
I've got it down the bottom of the website and I started check
21:50
on chain.com because I became fascinated with on chain data.
21:54
So I don't pull my own data. I actually pull it from, from,
21:56
from others research. bitcoin.net has been fantastic.
22:00
So he's been, he's been, he's recently open sourced his API.
22:03
So I've been pulling a lot of his on chain stuff.
22:05
But essentially I just, I mean, I make the, the, the data free
22:08
And that's, that's the big thing for me is I want to make the,
22:10
the charts free. And that's, you know, on chain
22:14
came from an open source world. The website was my project, my
22:17
personal project to learn Python And get off Excel because I used
22:21
to be an civil engineer. I use Excel for everything.
22:24
And I got sick of downloading CS VS uploading them, redoing my
22:27
charts. It was a pain in the ass.
22:29
So I was like, OK, I have to learn how to use Python now.
22:32
So check on chain was my like personal project to teach myself
22:35
Python And it's essentially just been chugging away building up
22:38
ever since, right. So the newsletter we've got
22:41
again, check inchain.com. That's essentially where I, you
22:45
know, the way I view it, the charts I like to make available
22:49
because I want every, you know, Bitcoin is open source.
22:51
I love the open source nature of it.
22:53
On chain has always been an open source kind of discipline.
22:58
And some people write this is the crazy thing about it.
23:01
We as like the the plebs. The plebs know so much more
23:05
about on chain data than the institutions.
23:08
They are so far behind. It's they'll get there.
23:11
But this stuff is just amazing because you can see when people
23:14
are in too much profit, when they're getting flushed out,
23:17
when they're buying high, selling low.
23:18
You can see what people are doing.
23:21
It's like having X-ray vision where you get like 3040% of the
23:23
cards on the table. You can see what's going on.
23:27
So I make the, the charts free, but my time doing the
23:30
interpretation, my time doing the analysis, my proof of work.
23:34
That's what I, that's what I charge for essentially, which is
23:37
in my newsletter. And again, it's not expensive,
23:39
right? It's 20 bucks a month.
23:40
But it's, the idea is, you know, that's my time to analyze,
23:44
assess and kind of go over what the market is doing, use the
23:48
tools, show people and teach people how to use them.
23:50
That's the, the general framework, right?
23:52
So I'm a big, big advocate for like value for value.
23:55
So the charts are free. They'll always be free, but the
23:58
idea is that the interpretation of my time doing the work,
24:01
that's what's valuable and that's what I charge for.
24:03
Gotcha, man. First of all, fascinating and
24:06
shout out to your proof of work, man that this is, you know, this
24:09
is incredible stuff. It's fascinating to me.
24:11
I always thought, you know, that it was basically impossible to,
24:16
you know, to really understand what's going on.
24:18
But I guess you're making the case that it's not all of it of
24:22
what's going on, but a percentage you can, you can feel
24:25
very confident in terms of because it could, could you walk
24:29
people through in case they don't know, like what?
24:31
Like what is it the how could you tell by the data?
24:34
Is it just like blockchain information you're seeing at
24:37
like old addresses move their Bitcoin, receive Bitcoin?
24:40
Like how are you getting to these conclusions?
24:43
Great question. So let let me bring it back to
24:45
my civil engineering days because I think this can help
24:47
people connect the dots on how what what I used to do is called
24:50
geotechnical. So I used to design stuff in the
24:52
ground, right, basements, foundations, tunnels, mines, all
24:57
that kind of anything that's excavation.
24:59
I was the one who's designing the whole essentially.
25:02
Now when you're doing a project like that, right, that one of
25:05
the jobs I worked on was a train station and we had to excavate
25:08
A50 by 50m square footprint, 30 meters deep.
25:12
Now that's 180 million kilograms of material.
25:15
It's a lot. And in order to design that, I
25:18
have to design off 5 boreholes which are about this big 50 mil
25:22
diameter. So you get 0.0039% of the ground
25:27
that's there and you have to design everything.
25:29
So I'm very used to dealing with risk, uncertainty and incomplete
25:34
information. And the cool thing about that is
25:36
you can you have to take those five boreholes and then go back
25:39
and go, OK, I've got sandstone here, I've got clay there.
25:42
What, like a million years ago? How did that sandstone get
25:46
there? And if that sandstone got there
25:47
via mechanism AB and C, what were the tectonics like in that
25:51
time? Am I expecting there to be
25:52
faults and fractures and cracks? You have to use like the world
25:56
and all of the information you possibly can, right?
25:59
I used mappings from inside the tunnel they excavated in the
26:02
60s. And you start looking and say,
26:03
OK, well, there's faults at this kind of regular intervals and
26:06
all that kind of stuff. So you have to use lots of, lots
26:11
of inputs from different types, photographs, boreholes, soil
26:15
sampling, you know, history books, all sorts of shit to
26:18
compile a, a thesis. And then your thesis not only
26:22
has to be like robust enough to design off, the thesis also has
26:26
to be flexible because if you're digging down and you're
26:28
expecting sandstone and you get clay and suddenly your whole
26:32
building's going to fall over, then your design's shit.
26:34
You have to design knowing that these variabilities can come in
26:37
and markets, this is markets. This is what markets do.
26:40
They are entirely variable, right?
26:43
So now bring it back to the world of on chain.
26:45
Hopefully that kind of sets the scene for how I personally ended
26:48
up doing this particular field of work in the world of on chain
26:51
data. Bitcoin is just a big database,
26:54
right? Every 10 minutes we do an append
26:56
only rows to the spreadsheet. We just keep adding more rows
26:59
and you can't change everything that's above what we're really
27:02
looking at. And you know, we're not doing
27:04
stuff like chain analysis where you're saying, oh, this is this
27:06
particular entity and this is this particular guy.
27:09
You know, we'll look at exchanges and stuff, but it's
27:12
not really useful in my opinion. For the most part.
27:15
What I look at is I call them cohorts.
27:18
You'll often hear long term holder, short term holder,
27:21
really, really clean way to do it.
27:22
It's basically if you held your coins for five months or, or
27:25
more than, right, Hodler, Smartmoney or Hodler and
27:28
Speculator. Simple way to think about it.
27:31
Now you can look at, OK, how many coins do they own and how
27:34
many coins are they spending in aggregate, right?
27:37
But not only are they spending or holding, are they in profit
27:40
or in loss? Because think about what does a
27:42
top actually look like? Let me describe what are the
27:45
mechanics of a top and the mechanics of a bottom, and
27:47
you'll probably be able to see why this data's useful at the
27:50
top. What do you want to see?
27:52
If you're looking for an exit signal, what are you looking
27:54
for? The smart money who bought down
27:56
the bear market and on a huge amount of profit start moving
27:59
their coins. They start selling, right,
28:01
because they're taking chips off the table.
28:03
It may not be you selling, but there are hodlers who are
28:05
selling. So what happens there is that
28:08
old money whose firm handed high conviction coins are in cold
28:12
storage. They're up 400 percent, 500
28:15
percent, 10X, and they start to take chips off the table in
28:19
increasing size. Who's buying those coins while
28:23
not people who bought in the bear market, people who heard
28:25
about Bitcoin from their friend who's getting rich or their Uber
28:27
driver. The less the more experienced
28:30
people are selling coins in profit to the less experienced
28:34
buyer. Now what happens when a top
28:36
starts to form? Those very inexperienced buyers
28:41
have seen their 50% profit suddenly go down to a -, 50%
28:45
very quickly and they panic. They start bailing out and that
28:49
sell side cascades and you get this cascading of a bear.
28:52
So what I'm looking for is who owns the coins?
28:55
Who's holding them? Who's spending them?
28:57
How long have they held them? Are they in profit or loss?
29:01
Are the coins that that you know when, when you're looking for a
29:03
bull market dip and you want to actually add to your position,
29:06
the dumb money always buys high. Always.
29:09
But then they also sell low. And what you're looking for is,
29:12
I want to see when the smart money sells in a profit, the
29:15
dumb money buys it, wait for them to sell in a loss and
29:18
capitulate. And then you buy that dip.
29:20
And that's exactly what we saw at 57 Ki put a newsletter on it
29:23
for my Subs because that's essentially the moment where
29:26
you're looking at like a micro capitulation.
29:28
And as we said at the start of the call, people are always
29:30
wrong. And on chain data helps you
29:33
visualize the crowd. And when you can see the crowd,
29:37
you can start doing the opposite of what the crowd is doing,
29:39
right. You can see when the smart money
29:40
starts doing something and then the crowd starts behaving a
29:43
certain way and then you act accordingly.
29:46
So, you know, it's a good way to improve your DCA.
29:48
It's a good way to just like understand where cycles are and
29:51
all the exact opposite is true in a bear market at the bottom,
29:54
What do you want to see? All the speculators are gone.
29:57
There's no fast money. They're gone.
29:59
The only people left are the hodlers, and they can carry
30:02
enormous unrealized losses. So I look for the point when the
30:04
hodlers are carrying like 50% down because when they're that
30:09
down on their position, everyone else is gone.
30:11
No one else can stomach that kind of a drawdown.
30:14
And the Bitcoin is they they're the ones who establish the flaw.
30:17
So that's a bit of a view on, on what this data is actually
30:20
doing. It's it's fascinating.
30:21
It's fascinating to. You it it it's super fascinating
30:23
and, and, and I I you know, I love that we're having this
30:26
conversation. How is this is it is it enough
30:30
information to to trade like is this enough information to give
30:34
you an edge? Like, you know, a lot of the
30:36
things that, that you know, bitcoins have gone through and
30:40
I'll speak for myself, like I'm, I'm a hodler.
30:41
Like I don't, I don't trade. Like I just, I've bought the,
30:44
I've bought the top and I've bought the bottom every single
30:47
time. Not cause I've known it was.
30:49
I mean, you, you, you start to get that into the intuition,
30:53
start to build and you intuitively start to know.
30:57
Like I know for a fact, like when we were at like 1516 Ki
31:01
couldn't have shown you to any type of data whatsoever, but you
31:05
know, you're like, OK, like most likely we're not going any lower
31:08
than this. And then you're like, fuck, I
31:10
wish I had more cash. Well.
31:12
And so the thing about on chain is those intuitions, the on
31:16
chain and like anything, right, there's 1001 technical
31:19
indicators, but people still use the RSI and the MACD.
31:22
People have just like the crowd favourites.
31:24
On chain's the same. There's 1001 metrics and I'll
31:26
use a whole bunch of them, but there's only like 10 that the
31:29
average guy needs to really like wrap their head around.
31:31
They're all interrelated and it gives you so much of A benefit.
31:34
So those intuitions, you can just like consult a handful of
31:37
matches. OK, It feels like there's no
31:40
speculators left. Let me just go and check and see
31:43
whether all the short, all the short term holders are gone and
31:46
all the long term holders are holding fat losses.
31:48
Yeah, that looks like seller exhaustion looks like a bottom.
31:51
So it adds that conviction now. And I can see a bunch of people
31:53
in the in the comments like I'm also a Hudler, right?
31:55
I'm a I'm a buy and hold. However, at the same time, I
32:00
look at the way that Michael Saylor, for example, right when
32:02
he's taking on a billion dollar loan and he's buying all this
32:05
Bitcoin at 50,000. And I commend him for buying the
32:08
top. But if he hadn't just bought
32:10
near the short term holder cost basis, do not buy unless short
32:13
term MVRV is below 1. If he hadn't done that, his
32:17
position would be so much better.
32:18
And like as a hodler that you want to increase your stack.
32:23
Now, what's also I think is, and our tagline is that we want to
32:27
be like your Bitcoin personal trainer because even as a
32:30
hodler, volatility is hard because just envision for a
32:33
second, we wake up tomorrow, Bitcoins at 100K or Bitcoins at
32:38
40K. In both of those instances, the
32:41
reactions going to be the exact same from most people.
32:43
Holy shit, what happened, right? And they're going to want to go
32:46
and find out why this happened. So volatility creates
32:50
uncertainty because some hodlers are going to be like, you know
32:52
what? I do need to, at some point my
32:55
wife is nagging me or I need to buy a house or I need to put my
32:57
kids through school. Whatever it is, there's going to
33:00
be some life reason because Bitcoin is your savings.
33:02
What do you spend your savings on?
33:03
Anything you fucking want because that's what it's for.
33:06
If you need to go and buy something and you want to
33:09
actually use your Bitcoin savings and use your proof of
33:11
work for its intended purpose, there are opportunities to like,
33:14
there's nothing worse than selling and seeing the market
33:17
moon right straight after. It's horrible.
33:19
It's almost as bad as buying and seeing it sell off.
33:22
So just getting a vibe for like, well, if I am going to take
33:25
chips off the table, I want to do it in a way where it's like,
33:28
OK, it's more than likely that this is getting pretty close.
33:31
We're in heated territory. It's unlocked.
33:33
I don't want to do another bear mark.
33:35
Some people are getting to the stage in their life where
33:38
they'll huddle 80 percent, 90% of their corn, but they can't do
33:42
another bear market with 100% allocated, right?
33:44
And it's, it's, it's a, you reach a certain age.
33:47
And I think a lot when you look at your probably your
33:49
demographics to the same millennials, Millennials are now
33:52
getting to the point where they can't deal with the same
33:54
volatility they could five years ago, right?
33:57
In five years time, they're not going to be able to.
33:59
So you can use this stuff to just like make it easier to
34:04
know, yeah, it's pretty likely that we're getting hot or you
34:07
then wait for the the bottom right.
34:09
I, I use on chain all the time to buy dips because I don't
34:12
particularly want to buy Bitcoin as expensive as I can.
34:15
And if it looks like it's going to correct, I'll just wait,
34:18
right? And I'll, I'll still buy, but I
34:20
just won't buy right then and there.
34:22
I'll just buy kind of calm my nerves and ground myself in some
34:25
time and say, well, it looks like it's probably going to come
34:27
down at this level. And when this, this and this
34:29
happened, I will do, I will do my DCA.
34:32
So you get the end result, but you get it at a much better
34:34
price, even if it's on small term.
34:36
Yeah. And, and, and what's fascinating
34:38
too with Sailor is that like, even though he's a billionaire,
34:43
very successful guy has a public company behind him, he had to
34:46
pay the price of tuition just like every single one of us.
34:51
And I think that is so unique to Bitcoin because all of these
34:56
institutions, I feel like they're going to make the exact
34:59
same like this is going to run next year and this is going to
35:03
get bonkers. And one other thing is that a
35:06
lot of institutions this cycle, they jumped the horse.
35:10
They went straight to Ethereum thinking that it was going to
35:12
outperform. And I've heard this story from
35:14
so many institutions. They got rinsed because they
35:17
didn't they, they kind of skipped the, oh, Bitcoin's gonna
35:20
go up and Ethereum's gonna go up more.
35:21
And they bought a bunch of Ethereum and then Bitcoin went
35:23
up a lot more and Ethereum went nowhere versus Bitcoin, down
35:26
versus Bitcoin. So a lot of institutions haven't
35:29
learnt their lessons. They have to, but everyone has
35:31
to do it. You have to go through the
35:33
wringer. There's the only way. 100% and
35:36
there's no there's no special class, right?
35:38
Like everyone plays by the same set of rules and makes Bitcoin
35:43
extremely unique in that sense. So James, I think a lot of us
35:48
and I, I'm so glad that we were talking about earlier how kind
35:52
of the, the, the consensus right now is they see the power law.
35:58
They have PTSD from the previous cycle and they're buying into
36:02
the diminishing returns theory. We're going to break a hundred
36:05
150 Ki would like to believe just because the general
36:09
consensus is always wrong. I think we might go a lot higher
36:13
because it's, it was just gonna surprise people like, oh, I'm
36:15
gonna sell here at 200 K, thing rips up, you know?
36:19
Yeah, my my instinct, my instinct is that we go higher
36:23
than people expect and it takes way longer, like way longer.
36:28
And I also think so I, I think that this like slow and steady
36:32
grind is real. I and, and look, there's a lot
36:35
of components to this, but we also have to remember that like
36:38
within these trade ranges, when you go through the markets, go
36:41
through range expansion to range contraction, which means it
36:43
rallies and then a consolidation chops around think about
36:46
consolidations as recharging the fuel tank.
36:49
That's that's the correct way to think about a consolidation and
36:52
a correction is actually faster. It it's like supercharging that
36:56
reach recharge. Now, sometimes a correction can
36:58
get really nasty and that's why, you know, it turns into a bear
37:00
market. That's why we look at top
37:01
heaviness. But for the most part, things
37:04
look really, really stable and healthy right now.
37:07
But it takes time and a lot of people are like, oh, I'm really
37:10
bored in this range. It's like, well, we had 18
37:13
months of up only it just went up for 18 months with no
37:16
corrections really. I mean, still even today we have
37:19
only 20.4% is the correction we had at 57 K.
37:23
That's the deepest since FTX blew up.
37:26
That's a wild stat. So we have added 550 billion,
37:32
yeah, $550 billion in market cap this year and we've added $1.1
37:37
trillion since FTX blew up. I mean these numbers are
37:41
absolutely astounding. And to only have a 20%
37:44
correction, we always have like 2530 forty 50%, we've barely had
37:48
20 like we're we're stair stepping higher.
37:51
It looks fantastic under the hood.
37:54
So I think it's going to take longer than people expect within
37:57
these consolidations. We will see a lot.
37:59
I mean, there's been a lot of discussion this week about the
38:00
cash and carry trade during consolidations.
38:05
Lots and lots of trading firms. They'll sell options top and
38:08
bottom. We've seen options are now as
38:09
big as futures. So we'll see people selling
38:13
calls and selling puts. We'll see people compressing
38:16
volatility. There'll be traders who chop
38:17
around basically all the the, the market dynamics.
38:22
And a lot of people like, oh, people are shorting Bitcoin.
38:24
It's like, no, if Bitcoin gets every asset that has futures,
38:28
has a cash and carry trade, every asset that gets big enough
38:32
to justify caring about has a futures market.
38:35
So these are just part of the world of Bitcoin growing up.
38:38
Every asset has these, it's of any size and these kind of, you
38:42
know, volatility strategies, buying and selling calls and
38:46
puts, you know, basis trades, all these things.
38:50
They add liquidity and depth to the books 'cause there's people
38:53
getting in and out of positions, but it also kind of keeps the
38:56
market stable for a period of time while it digests.
38:59
Eventually it breaks out, but a lot of people get chopped up
39:02
because I think it's over and they get bored and they walk
39:03
away, but eventually it breaks out, right?
39:06
And these dynamics are just things we have to get used to.
39:10
But it does take volatility out of markets.
39:13
It does compress things a little bit, make it slower and and
39:16
steadier. But remember, I mean, how many
39:18
people have you had a conversation with where you
39:19
could not orange peel them because they were concerned
39:21
about the volatility? Well, here we are folks.
39:23
Bitcoin is about as volatile as that.
39:25
I think Alex Thorne had a fantastic chart that chose
39:28
Bitcoin's volatility relative to like the top 20 stocks in the
39:30
S&P 500. And it's like, unless it was
39:33
orange, you wouldn't be able to see it because that's the, it's
39:35
the same volatility as everything else.
39:37
The barriers that keep these institutions and these firms and
39:40
stuff from coming in, they just slowly weed away, right?
39:44
So we're going to be, you know, Bitcoin is going to go much
39:48
higher. It's just going to take a long
39:49
time. And that's, that's part of the
39:51
process. And the hard thing is setting
39:53
your expectations. If too many people expect a moon
39:56
mission, they're going to get shaken out.
39:58
So just correcting your expectations to the world that
40:01
we're in and just preparing your patience, sitting and doing
40:05
nothing is the hardest part of markets.
40:08
But there's a great quote by Jesse Livermore.
40:11
From a reminiscence of a stock operator, like, you know,
40:13
arguably the greatest trader of all time back in the 1920s.
40:16
And he basically said, I never made my money from buying and
40:19
selling stocks. I made it by just sitting tight,
40:21
just sitting there owning high quality stuff and doing nothing.
40:25
But most people can't do it. We are itching.
40:27
We're itching. This is actually why shit coins
40:29
have so many people like, oh, but your coin doesn't do
40:31
anything. It's like because they're
40:32
itching to do something because they're impatient, they can't
40:36
just sit there and do nothing. They have to go and you know,
40:38
keep keep spending and gambling and all this kind of shit.
40:40
That's that's where the the high time preference comes from.
40:43
The hardest thing is to do absolutely nothing and just
40:46
wait. Just wait.
40:47
And that's that's what the process is currently playing out
40:49
a. 100% I mean, yeah, I, I, I, I feel the boredom.
40:53
You, you kind of feel it and you feel it in the air, so to speak.
40:58
Twitter's eating itself and we're like 5% off all time.
41:00
High. Yeah, no, it's it's it's like,
41:02
you know, it's like, yeah, we're we're at all time high, but it's
41:05
like I feel nothing now, James, what is like you're saying this
41:09
time it's gonna take longer So what does that mean?
41:12
Are you seeing, you know, 12 to 18 months from now?
41:15
Like what is what is the consensus for?
41:18
Like what is what is how you seeing what what are you
41:21
defining as it? It might take longer this cycle.
41:24
Yeah, great question. So, so I and you're very, very
41:27
rarely see me do this. I don't really say, oh, some
41:30
people are like, oh, the all time high is going to be in, in
41:32
12 months. I have no idea when the all time
41:33
high is going to be the all time high.
41:34
I, I, I reversed the whole equation.
41:38
People say, oh, the all time high will be in 12 months and it
41:40
will probably be around this price.
41:42
I say, show me what the market is doing and I'll tell you
41:45
whether it looks like an all time high.
41:47
That's the way I, I reverse it. I, I basically say, show me the
41:50
mechanics, Show me when the structural under under the
41:53
surface, Show me when too many people have bought too many
41:56
coins are too high of a price. When I see those conditions,
42:00
then I'll look at the date and then I'll look at the price and
42:02
I'll be like, OK, that looks like a top that's more likely to
42:05
be a top. So I try to reverse it around.
42:07
So in terms of how long it's going to take and what price
42:10
we're going to get to, I have no idea and I have no idea, but I'm
42:12
excited to find out. Are are cycles still a thing?
42:15
Do you still foresee cycles playing a a role in in Bitcoin?
42:19
Great question. That's a great question
42:21
actually. So that was one of the only
42:23
narratives that everyone wrote off and said there will be no
42:26
more four year cycle, last cycle, right?
42:29
So in the last cycle it was like 4 years done.
42:31
It's over. It was the only narrative that
42:33
survived, right, The four year cycle.
42:35
So whilst I and whilst I just said that, you know, I will look
42:40
for the conditions and that is like my base case, I
42:42
simultaneously go, well, the four year cycles have continued
42:46
to work and I will wait until they don't work right.
42:49
So I'm, I'm on the side that it's more likely that they
42:52
continue because the other thing about bull markets in the
42:56
current market we're in this boredom shakes people out, but
43:00
it's very, very sustainable because new money will come in,
43:02
big money gets more comfortable. This thing can just stair step
43:05
higher. Once we move into the euphoric
43:08
phase, which historically speaking is when we're at a new
43:10
all time high. So we could be on the cusp of
43:13
euphoria, but with we, we kind of were at 73, but that's really
43:18
calmed down quite a lot. So maybe we have to get to 80 or
43:22
maybe we have to get to 100. I don't know before euphoria
43:24
kicks in, but when euphoria kicks in, then you're on a bit
43:27
of a timeline. And the reason why is that you
43:30
may have experienced this in the previous bull if you were there.
43:33
You, you get tired. Just the, the up only the chaos,
43:37
the you know, you're, you're checking the price all the time.
43:40
You're on Twitter. It's exhausting, it's tiring.
43:42
Markets are like that. Markets can't deal with like an
43:45
unstable equilibrium. So when you move into the
43:48
euphoria phase, you can see it in on chain metrics as well.
43:51
People's profit and loss is chopping around like crazy.
43:54
It's, it's, it's, it's bananas. It exhausts you.
43:57
So if we go quiet and trending, the longer this quiet and
44:00
trending goes, this can just keep going, right?
44:02
The stock market is this just 10 years of just climbing.
44:06
Once you get into the real volatile upside, that's when
44:10
you're on a bit of a bit of a ticking clock because the market
44:12
just can't. It can't handle that for so long
44:15
because it gets tired and worn out.
44:17
Damn man, that's it's interesting.
44:20
Interesting. And markets have this like this
44:22
like resonance, they like they move within these different
44:25
regimes. And we can see, I love to look
44:27
at like MVRV, you know, one of the oldest metrics, it's, it's
44:30
essentially everyone's profit and loss unrealized.
44:32
So the, the profit and loss you're holding.
44:34
And you'll see that during this phase, right 2015 to 20/16/2019
44:40
up to 20/20/2023 to now. It's just this like everyone's
44:44
profit and loss is just slowly getting better.
44:46
Just like crawling higher. Once you break the all time
44:49
high, people are bang right in a profit.
44:51
Bang, Oh shit, bang it right. It, it gets, you can see it in
44:55
the oscillator. It gets volatile.
44:57
That's what chops people up. Some people like, yes, but I'm
44:59
in trader's paradise. I'm gonna buy that dip.
45:01
I'm gonna sell that rip. Someone else is like, I'm gonna
45:03
rotate into a shit coin. And then eventually the whole
45:05
thing just done over 'cause you can't sustain it.
45:08
Oh man. And then just the IT just comes.
45:12
And then the hangover starts and oh.
45:14
Hang on, this is the hairy back. This is crazy, but but again,
45:17
it's, you know, you have very powerful institutions that are
45:21
kind of a part of this now, which is, you know, it's I I
45:24
find fascinating. Anyways, there's some questions
45:28
from the audience that I wanted to ask you.
45:29
So First off, it this last cycle was really interesting.
45:35
We hit, we just hit basically the all time high before the
45:38
halving and then we also hit the previous low.
45:43
So like the 1617 K was lower than the previous all time high,
45:50
which has never happened in Bitcoin's history.
45:53
So were we kind of seeing things that were not there were was
45:57
that one of those laws that, you know, you just mentioned the
45:59
having one that hasn't broken yet?
46:01
That that was one of the laws last cycle that it hasn't broken
46:04
yet and it it broke and it really is of no consequence.
46:08
Or is there a deeper meaning there?
46:11
No, there's no meaning to IT. People like to assign that
46:13
stuff. It's like, oh, all time high
46:14
before halving. It's never happened.
46:15
It's like, yeah, but we've also got three data points that we're
46:18
comparing it to, right. So it's not, it's not a long
46:20
term thing. You know, they're, they're very
46:23
easy narratives that people kind of anchor to.
46:25
One thing I will say though, is the, the bottom from a
46:28
structural perspective, from a mechanical perspective, you may
46:32
remember that Luna sold us off down to 30 K and then three
46:35
arrows blew up and we went down to like 17.
46:37
I think we hit that's when the bottom started forming on that
46:41
first sell off when, when 3 arrows blew up.
46:44
So we traded sideways. That would have been June or
46:46
July 2022 and we traded sideways until I think November was FTX.
46:52
So that whole period was actually very, very bottom
46:55
forming. FTX collapsing was like a
46:57
hyperextension. It, it, it, it wasn't kind of
47:00
the intended result. We would have probably if FTX
47:03
hadn't blown up, we actually would have bottomed, I think in
47:06
around that range and then kept going.
47:07
But FTX was like this like, and we did, we went, we basically
47:11
just did this like little box out like a inverse bot.
47:14
So the that FTX was a bit of a hyperextension to the downside,
47:19
but also, and when we talk about like how we took out the
47:22
previous all time high on the low side, I got a chart that I I
47:26
love it. It's my one of my favourites.
47:28
It's about the shrimp and the shrimp, and it looks at their 90
47:31
day, how much their balance has increased.
47:33
And it's an amazing chart because it actually shows the
47:36
success of Bitcoin's education. So let me describe it.
47:39
It's basically an oscillator, like a wave, and it's showing
47:42
you how much the shrimp added to their balance.
47:45
The, the biggest peak for a long, long time was the tippity
47:49
top of the 2017 peak, the 20,000 top.
47:52
And that was me. I bought there.
47:53
That was my first coin. I bought the absolute top tick
47:56
plus a fee on Coinbase. You couldn't have bought higher
47:58
than me. And then I got rinse.
48:01
What I did start doing is listening to the new podcast and
48:04
there was an explosion in high quality Bitcoin education,
48:07
right? You lifted as well the amount of
48:09
bit high quality Bitcoin education from 2017.
48:12
Let's just say up until Michael Saylor bought in 2020, that
48:14
phase and even beyond, it was a whole different world.
48:18
So now the shrimp, the shrimp know what they own.
48:22
So we never saw that same level of buy side from 2017 at 20,000
48:28
until 2022 when we reached 20,000.
48:31
But in a bear market from the other direction.
48:33
And the shrimp, their wallets exploded.
48:36
They started buying like crazy when when three hours blew up
48:39
and then when FTX blew up, they went even hand.
48:41
So you've got these like two peaks that blew out the previous
48:44
all time high. So what does that tell you?
48:46
That tells you the shrimp aren't as dumb as they seem because not
48:50
only did they buy the bottom, the exact bottom in the biggest
48:53
size we've ever seen, they also sold on the 2021 rip and they
48:57
sold into the ETFs, right? Not a lot, but enough, enough to
49:01
prove that the shrimp are actually smart money in every
49:04
other market, retail folks are the dumb money, right?
49:08
The institutions look at retail folks as the dumb money and they
49:10
are there to take money from the casino.
49:13
In Bitcoin, the shrimp actually know what's up and it's and I
49:16
I've seen this chart. I love it.
49:17
I think it's one of the most amazing things that just
49:19
describes how good the Bitcoin education machine has become.
49:23
Because everyone watching here, you know what you own and you
49:25
know why you own it. And we can see it in the data,
49:28
right? You're ahead of Wall Street.
49:29
You actually know what's going on way better than them.
49:31
Trust your intuition, trust your instincts, because you're
49:34
you're, you're better off than they are.
49:37
Oh man, drop. James.
49:39
Dropping the mic. Dropping the mic, man.
49:42
Dude, yeah, it's and Wall Street might be the dumb money this
49:48
cycle. They might.
49:50
Be holding 8th. They got minced.
49:53
It already happened. Oh, man, Great, great.
49:56
All right, so we are getting too close to the top of the hour.
50:00
So it is towards the end of the show and there some guests that
50:03
I asked them this question and depending on who the guest is,
50:07
some feel comfortable in answering it, some don't.
50:09
But if you are to put a number, and I know you're not supposed
50:14
to do this for, you know, Bitcoin only podcast, but I'm
50:16
going to totally do it anyways. If you are to put a number and
50:21
I'll go first if if that sets the tone.
50:24
If you are put, if you are to put a number on the previous
50:28
top, which you said so elegantly, you know you can't.
50:31
You have to see the data before you you even tell everybody
50:35
where it's going to. Be if we're going to take a
50:36
punt, yeah. If we're if we're going to do
50:38
it, if we're going to kick a kangaroo in the balls, we just
50:42
got to rip it and do it right and then run away and hope it
50:44
doesn't tear your head off. Metaphorically YouTube.
50:48
So yeah, I mean, I'll say first I would say between 2:50 and
50:54
300, that's what I. That's, that's where I think
50:57
that, that's where I think we probably settle and, and there's
50:59
a few reasons for this, right? So I've got two that that's my
51:02
like instinctual 250K is probably where I think we
51:06
probably deserve to, to reach some kind of a plateau.
51:09
However, when people actually ask me what is my price
51:12
prediction, I, I do a very simple piece of calculation.
51:15
How many bars of gold are there per Bitcoin?
51:18
Right? Right now it's 10.8 kilograms.
51:21
What's 10.8 kilos worth? I don't know what is in U.S.
51:23
dollars, probably like 750K or 1.2 million Australian.
51:28
So that's, that's my price target, right?
51:30
What is Bitcoin worth? Well, it's better than gold.
51:32
So it should equal gold. So therefore 10.8 kilos of gold
51:35
is the price. Whatever 10.8 kilos of gold is,
51:38
that's where we're headed. So that's like the long term
51:40
view in the short term because as I said, it takes time to get
51:43
there. It takes bull markets, bear
51:45
markets, crab markets, sideways markets.
51:47
It's a process. In order to get to 10.8 kilos of
51:50
gold, we're probably gonna bump our head up around, I don't
51:53
know, three or four kilos, right?
51:56
Oh man, oh man, I can't well, it's just making me feel bullish
52:01
and you know, I, I I agree. Look, it is superior to gold.
52:04
I mean, you had similar scientific come out and some of
52:08
their logic that they used on in the press release is, you know,
52:13
this is better than gold. It's going to 10X and they put
52:16
gold in, you know, in the press release.
52:19
So, yeah, I, I, I, I completely agree.
52:21
And I think it's just a matter of time before the world wakes
52:24
up to that reality. So and.
52:26
It's funny 'cause I I've I've bought physical gold and I went
52:28
through the process and I can assure you it is a more than 10X
52:32
improvement. Yeah, I mean it it, but, but
52:36
again, it's because we're trying to be conservative, right?
52:38
It's like it's at least going to do this.
52:41
But that's the base case. That's the base case that
52:44
everyone has to remember, right? But James, thank you so much for
52:47
joining us on the show today. Really appreciate it.
52:50
Guys. Go check out check on chain.com.
52:53
And also, if you had any last words for our guests in the
52:56
audience right now, there's currently 736 people watching
52:59
live between YouTube and X. If you have any last messages
53:03
for the audience, what would it be?
53:04
Yeah, I mean, I think the, the thing with on chain data is that
53:07
it's us. It is us, right?
53:08
We create the on chain data, our transactions, our buying, our
53:12
selling. It's not like, yes, there's a
53:15
little bit of proof of work you got to do, but it's actually not
53:17
as hard as people think. The idea is you're trying to
53:19
just help yourself navigate, ground yourself in some very
53:22
simple data. Let Bitcoin tell you what it's
53:25
doing. Because the news and the media
53:27
and my, one of my favorite lines, I love watching the, the,
53:30
the narrative on Twitter not happen in the on chain data
53:33
because it's just such a great tool to filter out the noise.
53:37
It's very easy for people to get stuck on the narrative.
53:40
This kind of data is it's not as hard as you think.
53:42
I, my process is trying to simplify it for people, but it
53:45
can help you navigate the volatility because whether
53:48
you're a hodler or you know, whoever, it's hard.
53:51
It can be hard if it rips, if it sells off.
53:53
The the biggest feedback that I get from people is I don't care
53:57
because I know why it happened and when I know why it happened
54:00
and I was prepared for it, it helps me huddle.
54:02
And that was like the original thrust.
54:04
I had so many people tell me that feedback.
54:05
I'm like, that's the service. Help people huddle, help them
54:09
navigate this shit. They know they're not selling.
54:11
They're going to hang on forever, but they need to
54:13
understand why things happen because it makes it easier.
54:15
So you're not, you know, itching all the time to be like, oh
54:18
shit, is that the top? Is that the bottom?
54:19
Should I do something? Should I not like you can smooth
54:22
that out by just understanding what's going on.
54:24
Amen. Amen to that.
54:26
Well, James, thank you so much for joining us on Simply Bitcoin
54:29
IRL. Really appreciate it, guys.
54:31
Go check out his website, check on chain.com.
54:34
I'm going to put it in the video slash podcast description as
54:37
well. James, thank you so much for
54:39
coming on. Really appreciate it.
54:40
Thanks man, lot of fun. Thanks man.
54:43
All right guys, that was our show.
54:44
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54:45
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