Bitcoin passes $122k. It would appear I was wrong about shorting Bitcoin as a hedge, but Bitcoin has a tendency of forfeiting its gains. This was seen in August 2025 when it passed $124k, only to fall to $107k weeks later.
There are three factors that portend negatively to Bitcoin:
1. No progress on Bitcoin reserve. See my tweet below (and follow @2025blog if you haven’t already done so)
Yup, $btc crashing as it becomes apparent #bitcoin reserve not happening . I was right on two counts:
1. No reserve
2. Efficacy of the Bitcoin hedge https://t.co/rPJPvoxfDd
My account is positive today thanks to shorting bitcoin https://t.co/HwLzo58P8z pic.twitter.com/atNmfOYt2G
— Grey Enlightenment (@2025Blog) September 25, 2025
Trump has a tendency to make bold promises that he has little inclination to follow-up on. Declaring antifa a terrorist organization is nice, but what we need are full-scale investigations of all these donor networks and social media accounts as it pertains to the Charlie Kirk murder, among others. It needs to be treated with the same exigency as a national security crisis, political assassination, or terrorism, than a typical homicide, but I digress.
2. Treasury secretary Scott Bessent on August 18th ruled out Bitcoin purchases. Old news but still relevant.
Regarding #1 and #2, Trump is savvy enough to know that a taxpayer-funded Bitcoin reserve, in which the Treasury actually uses taxpayer dollars to buy Bitcoin on the open market, would be deeply divisive among voters and fodder for the left as ‘bailing out gamblers and speculators,’ which is true. Trump knows that a crypto reserve would only benefit a tiny number of donors, who own Bitcoin, and otherwise prove divisive and unpopular among large swaths of the population, hence why it won’t happen as I predicted a year ago.
Conversely, AI is much more popular among the public and is seen as essential for American competitiveness. Almost everyone uses ChatGPT or a related product, but few own much or any crypto. Hence, why Trump is much more enthusiastic about AI than crypto, such as acquiring a 10% stake in Intel, inviting the inevitable and ineffectual cries of ‘socialism’ by the losers at National Review, Reason, the Wall Street Journal and AEI, whose opinions never mattered at all in the first place. Governments by their very function or existance, ‘pick winners and losers’. The argument that governments should not interfere in markets is only possible without either markets or governments.
Since we’re on the topic of Trump and Bitcoin, on a related note, I also made huge returns on Polymarket by correctly predicting ‘no reserve,’ which offset some of my losses by having also shorted Bitcoin. The contract “Will Trump create Bitcoin reserve in first 100 days?” resolved as “NO”. Trump instead signed an executive order for a “stockpile”, however that is defined, but made no Bitcoin purchases, and it’s presumably unfunded as my tweet above shows. This does not count, so the contract resolved at $0, and I profited big.
I also made money by betting “NO” on the contract “US national Bitcoin reserve in 2025?,” which has fallen from 50% in early 2025 to now just 13%.
Recall how I correctly predicted in January 2025 there would be no Bitcoin reserve. A pattern I have observed as early as 2017 is people systematically keep overestimating Trump’s proclivity for action. Betting on inaction and delay is much more accurate. Here is what I wrote:
It’s the same pattern: people yet again vastly overestimated how easy it would be to create the reserve. In the comments, people said it would be as simple as making a few transfers. “All he has to do is blah blah…” I argued it would not be that simple. When it comes to Trump or government in general, nothing is ever simple or easy. Everything is delay and dithering, unless it’s $500 billion for AI investment. Those who donate the most get the least. This proved my point.
In the above passage, I was also right about Trump showering money on AI but dithering on Bitcoin. This is why I am still among the greatest forecasters, if not the greatest.
3. U.K. police seize $6.5 billion of Bitcoin. This Bitcoin will certainly be sold on the market, leading to considerable selling pressure in the coming months. This is similar to when the German government sold $2 billion of seized Bitcoin in 2024, leading to a $10k decline of the Bitcoin price.
As I wrote in the post “SBF sentencing: some thoughts. SBF got no favoritism“, counterintuitively, hacks and other illegal activity are ‘good’ for Bitcoin by effectively removing those coins from circulation:
FTX’s bankruptcy may have helped the price of Bitcoin in 2023-2024. Although bad in the short-term, exchange hacks and insolvencies are good in the long-term for the price of crypto by taking coins out of circulation. Insolvencies leave billions of dollars worth of crypto in limbo. On the other hand, individuals who wish to buy crypto simply deposit money to an exchange that does work, so it’s a net-positive. Hackers are typically unable to sell their loot on liquid exchanges, and so must use dark markets or the coins sit dormant in wallets forever.
But now an extra $6.5 billion will be entering the market.