During the Biden-Trump debate (or more accurately, the DNC’s crisis moment), many people assumed or predicted Biden’s loss would be good for crypto, but as Bitcoin falls again this Friday–as it always does–those hopes evaporated yet again. Bitcoin is looking as frail as Biden was on the stage last night. Bitcoin is already $7k lower from when I took that screenshot at $68k.
And as shown below, Bitcoin continues to diverge from the 3x tech ETFs TQQQ/TECL over past month:
The mass realization is setting in of what I knew all along, which is that Bitcoin, and crypto in general, has no place in a future dominated AI, GPUs, apps, delivery, electric cars, and so on. It’s just a sideshow or a distraction. Crypto earns no profits and returns nothing to shareholders, compared to hugely profitable tech companies.
Bitcoin’s poor performance relative to stocks has become so undeniable many people on Twitter are finally noticing:
When someone says #bitcoin will outpace real estate & stocks pic.twitter.com/y1NI5vZnWa
— Rob | Part Time Investor (PTI) (@InvestingRob) June 28, 2024
lol:
Stocks are also pumping today. Bitcoin follows stocks 99% of the time. Bulls could take control back. https://t.co/vxaLx8h0Id
— FreeWilly🐋 (@FreeWillyAlpha) June 28, 2024
Or instead of waiting for Bitcoin to eventually follow stocks, you can just…uh…buy stocks. Yeah, I know, amazing insight. So much for crypto providing diversification. Yes, diversification of the downside, but none of upside. Since April 2021, Bitcoin is unchanged in nominal terms and is down 15% after factoring in inflation, making it one of the worst performing assets over the past 3 years.
When hundreds of people are predicting Bitcoin will go higher, is it any coincidence the person who correctly predicts it will fall is also the smartest. As I wrote a few weeks ago, it’s not like they are handing out 150-170s IQs at the door. It’s reasonable to assume that smarter people are better at predicting, as making accurate predictions necessitates understanding the underlying system or process which is being forecasted. This explains how I keep being right about tech stock going up and crypto falling.
As evidence of superior pattern recognition, which is a component of IQ, I documented the perfect trading strategy involving shorting Bitcoin during market hours and buying leveraged tech, even if disclosing this method risks future profits, which no evidence suggests it has: my accounts keeps growing every day, week, and month as Bitcoin keeps falling or does nothing and tech stocks keep going up. Even now, the method is working. Bitcoin dropped from $61,600 at the open to $60,900, netting me another quick profit.
As I wrote before, for this method to fail–that is–for Bitcoin to outperform stocks, or for tech stocks to fall a lot and not recover–implies major economic structural changes, which for all practical purposes such risks can be disregarded. It means an economy in which today’s dominant tech companies are surpassed by crypto or something else. This is why sharing the methods does not hurt my profits or anyone else’s.
Yes, this is not infallible. A lot of smart people bought into the WMDs lie. Or thought Hillary would win in 2016. On the political axis, high-IQ people more represented among ‘the left’ than ‘the right’. The banner of Terence Tao’s weblog still endorses the ‘flatten the curve’ meme, which even if mathematically sound as a model, utterly failed in reality. IQ is a weak predictor of many things. But still despite these shortcomings smarter people ‘on net’ are right more often.