Value & Momentum

Value & Momentum

I think, basically, we hit the limit of how long the market can go up or stay stable without Bitcoin going up. And I think we're probably at that limit right now. Basically, I think we need a reset before we start going up again.

You need money to start flowing back into BTC. And for that to happen, I think you need Bitcoin to be at a good value level where people are comfortable buying it.

Not there yet.

Value & Momentum

And we're not necessarily there yet.

Today is a great day. Markets are red. Everything has collapsed in on itself, and people are calling yet again for a top after the move has played out. I'm sitting here reminded of what I was jawboning about on the last podcast: there's been a divergence. Maybe I was a little too quick to hop on it in the beginning.

1. Time to be Patient

Some people were like, “Hey, I think you're reading too much into something tiny happening here,” but it seems to be playing out. You've got a down day in crypto and an up day in equities, which is what happened last Monday when we recorded. I don't like it when you get a divergence like that. If a market is strong, it should have basically every reason to be strong, and it didn't.

The equity markets went up, and Bitcoin struggled for a little bit. We had some movement—we were up about 1% or so—but we couldn't crack $117,000. On ETH, the lower high that I pointed out meant that we sort of went sideways for a bit.

What we're looking at now is a solid retracement across the board. We're looking at weakness. This is kind of what we were talking about before: if Bitcoin goes down 2%, what are altcoins going to do?

Solana was a great short at the $250–$260 level, which we had talked about before. The long from $200—we were looking for $240 to $260—we got to $250, sort of tapped out there, and now it's retracing. I think we're in retrace-and-chop mode for now.

We're seeing it again today. NASDAQ is up 40 bps, and Bitcoin's down almost 3%. That's a sign that we've tapped out on buyers right now. You would think that if people were really interested in buying Bitcoin, then the correlation traders between NASDAQ and BTC and gold would be active.

Gold is up 1.5% today. It's ripping. You would think that, with all that considered, Bitcoin would be able to go up, and the answer is that it hasn't. I think we've lost momentum, and we're in chop mode.

For me, that means buying when we get a significant flush. I'm waiting for a nice flush. Maybe we hit $100,000; maybe we hit $95,000. I think $95,000 would be a little tough to hit from here, honestly, because I do think you get buyers stepping in a little above $100,000. But altcoins can get crushed here.

Basically, I think we're in wait-and-see mode. Jonah, what are you thinking here?

Yeah, I mean, you had a good call last week, and the rest of the stuff that you mentioned outside of crypto last week—Tesla, HOOD, basically equities, right?

And commodities. Don't forget my uranium pitch, which, by the way, uranium is up.

Value & Momentum

How much is URA up in the last week since you talked about it?

In the last week since I talked about it? It's up 14%.

Value & Momentum

That is ridiculous.

Let's go.

Value & Momentum

That is ridiculous. 14%. Jonah, are you taking any profits or no?

No. This is full-on boom-boom-town shitcoin. That's amazing. Uranium looks phenomenal right now, and it continues to look phenomenal. I see no reason to sell it.

Value & Momentum

Yeah, I mean, you had some good calls last week. I'll hand it to you and give credit where credit is due. Obviously, in the world of crypto, there's a lot of panic: “Oh my God, we're underperforming equities. Oh my God, it's sold off down to $112,000 from $117,000. The world is ending.”

I'm a little bit more sober and sanguine about this. I don't really think it's that bad. I think that, basically, every time we test local highs, people add a bunch of leverage, betting that it's going to break through, because that's a tried-and-tested strategy in crypto.

When it doesn't, people get liquidated, like today. Then it cleans the slate for yet another rally. I think we're just in a range-bound market, and most of the market is momentum trading. We've seen this a million times.

It happened last summer, too. It also happened during significant portions of last year, where we ranged like this for months. We had the same dialogue, where people were euphorically bullish at the highs of a tight range and absolutely melting with fear at the lows of the range.

I don't think there's anything that meaningful going on. I don't see a reason for capital to just exit crypto, especially with the broader risk-asset picture looking so bullish. If you look at ES1—the S&P 500—the Sharpe ratio since the April lows is probably above 3. Obviously, I'm cherry-picking that, but the Sharpe ratio this year is probably above 2.

It's just the most amazing investment. It feels like it goes up 3 out of every 4 days. With that in the background, how could you possibly be upset about having money in Bitcoin or altcoins?

I think it's just going to give us some opportunities. I agree with what you said. If you had some ideas or some things that you wanted to add to your shopping list—HYPE, for me, Aerodrome, and the ENA bulls out there are vocal—if there are some altcoins that you want to add, I feel like altcoins are about to get shellacked pretty hard.

I don't think this is over. Maybe you end up getting some of those great buys before we continue ripping. I don't have a specific short-term thesis on price directionality in crypto. It feels like a fruitless exercise to analyze why the entire space is down or up, other than just looking at leverage.

If we pull up Velo Data—let me see here, velo.xyz. I'm sure it's on the Blockworks dashboard, too. Funding got a little toppy on the highs, and then it just rinsed out.

Where's open interest? Same story. It's off over the last week. It went from, I guess, 4 days ago, when it peaked at a total of $33 billion in open interest. Now we're down $2–$3 billion from there, just in a couple of days. People are liquidating.

It's really just that. I don't think there's much more to analyze than this: it's a market of momentum traders, and it's ranging, so everybody's just getting chopped up. That's kind of my take.

Yeah, and I think you can see this in Solana specifically as well. You knew it was about time to get out once open interest started coming off a decent amount. Basically, you had a pretty sizable move in open interest at the highs, when Solana was trading at $230 and going to $248.

That move was entirely predicated on 3 million SOL coming online, which is actually a sizable amount. When moves are entirely driven by open interest, you have to start getting a little bit worried.

I think what I was catching on to last week, and what we were just starting to see the beginning of, is that the market has been tapped out of buyers at these levels. The DAT lost the ability to plow in a meaningful amount of capital. Even the Solana DAT—a lot of that was front-run by open interest itself.

Obviously, there was real buying, and that's why Solana is higher today than it was 3 weeks ago. But it wasn't necessarily the most sustainable buying, because what was happening is reminiscent of 2021. It's the same capital chasing slightly different opportunities.

In 2021, what you saw was that new chains would launch their EVM version of themselves, and then they'd launch some sort of incentive program to attract capital. It would happen one by one. Chain 1 would launch an incentive program, and all the capital would flood there. Then Chain 2 would launch an incentive program, and all the capital would leave Chain 1 to go to Chain 2.

Then Chain 3 would launch an incentive program, and all the capital would leave Chain 2 to go to Chain 3. That's a little bit of what's happening in crypto with these DATs. The money coming into the Solana DAT isn't necessarily new money.

It's recycled money from old DATs. It's people who made money in the first DAT rolling their money into the next one. Obviously, that's not the most sustainable thing in the world. When the leader starts to show weakness, it'll bring the rest of the market down.

Value & Momentum

You can’t. I think the crypto market has shown us over and over that when altcoins are popping off hard and Bitcoin is not, you get alt season. But you don’t last in that alt season for an extended period of time; that level of outperformance doesn’t last.

I’ve said in the past that’s probably anywhere from 2 to 3 weeks, or maybe 3 to 4 weeks max. If we look at how long Solana was seriously outperforming Bitcoin, it was a little bit longer this time. It was about 6 weeks of outperformance, but I think basically we hit the limit of how long the market can go up or stay stable without Bitcoin going up.

I think we’re probably at that limit right now. So, basically, I think we need a reset before we start going up again. You need money to start flowing back into BTC, and for that to happen, I think you need Bitcoin to be at a good value level where people are comfortable buying it.

We’re not there yet.

Value & Momentum

And we’re not necessarily there yet.

So, it does feel like we could get a pretty significant flush.

Value & Momentum

Correct. That’s my take. So, if I’m you and I’m trading, like I said last week, hopefully you sized down a little bit last week and you got more on the sidelines. Maybe you were a little bit more concentrated in some of the better stuff. Maybe you took on that BNB long that we were talking about that did pretty well.

But I wouldn’t be rushing in right now. If you’re fully allocated, I would cut a little bit. If you got out last week, you did a great job. Continue to stay out, I think, for a little bit.

If you really want to, you can nibble on some of the stuff that’s been really nuked if you like it. Maybe you want to buy a little bit of AERO. Maybe you can get that. I think, actually, BNB could be another interesting thing here just because it’s been so strong.

But basically, I would be waiting here. This is a time to be patient.

Yeah. I mean, I always like to buy Bitcoin, so buying dips is always easier to conceptualize when it’s denominated in BTC. I’m always like, “Oh yeah, sure, $112,000, why not?” But then when I ask—I think the real test of sentiment is: would I buy alts here? How does that feel? How does that feel in my gut? Right now, I wouldn’t want to catch the falling knife in any of these alts.

Well, I guess it depends on your alt, right? One alt that looks really good right now, which has been doing very well, is Aster. You’ve been paying attention to this?

Yeah. And we should talk about that quick one. I’ve obviously missed Aster for the same reason I missed Hyperliquid, despite having analyzed them both. I still don’t have a good mental framework for understanding why the world needs another exchange. I still can’t wrap my head around it. Call me dumb. Call me a boomer. I just don’t get it.

So, I’m okay missing some of these trades at the earliest possible phases. Why does the world need another perp DEX right now? Other than, “Oh, it’s CZ-sponsored, and there are the right KOLs around this, and oh look, other people are making money and screenshotting their wallets and posting it online.” What’s the actual reason why this should sustain the way that Hyperliquid did?

The thing that people sometimes forget—and this is no shade, no shade to Hyperliquid, right?—is that perp DEXs actually have a long history. If you go back 4 years, everyone was talking about how GMX was going to win. It was absolutely going to win.

Now, with that being said, no perp DEX has gotten to the size of Hyperliquid, and Hyperliquid’s team is extremely competent. They’re very good at what they do, and basically no other perp DEX has been able to even come close to what they’ve accomplished.

But history has shown that it’s possible to very easily steal away users if you provide similar levels of liquidity, a similar level of product, and a similar level of experience to the DEX itself, right? It’s very easy to click withdraw and then deposit. It takes 15 seconds to get off Hyperliquid and go somewhere else.

Okay, maybe not 15 seconds, because you have to wait for the bridge off of Arbitrum. But it doesn’t take more than half an hour, and it doesn’t take more than 15 seconds of active clicking to get off. So, it’s not particularly hard, is what I’m saying.

So, when you have something like Aster come out, I think immediately the bells have to go off in your head. It’s like, okay, well, if this product is backed by the number 1 exchange in the world, by CZ, then it’s probably going to have a moment in the sun.

Most of the time, what happens when this gets out there is that it has its moment in the sun and then it sort of just dies off. There’s a trade there, and the trade is probably a month-long trade. It’s the initial run-up, then the sell-off, and then the secondary run-up for everybody that missed the initial run-up. Then the thing actually doesn’t end up getting any traction or any usage, and it sort of just dies.

Yeah, that’s kind of my take on what’s going to happen here.

So, you think Aster is going to have its moment in the sun, flare up, and then flame out?

But I think it operates in an area that is possible, right? As long as it’s possible for it to steal some market share, I think it’s a good trade.

Right now, it basically traded up immensely, very, very quickly, and it’s had a 35% pullback from the highs. So, is it ready for round 2? I’m watching it. I think there’s a round-2 trade here, basically, to take it, as a lot of people missed that trade.

So, I’m kind of watching it. I’d probably nibble around a dollar. If we get a more significant pullback, I’d probably buy at a buck and try to sell out at 2 again.

I don’t know about doing trades like that. Maybe it works for you, but I wouldn’t recommend doing that for most people. The reason why is, just look at TRUMP coin, right?

At current valuations, Aster—I don’t know what their revenues are, but whatever they are, there’s not a statistically significant sample size of Aster revenues to justify the $2.4 billion FTV or wherever it’s trading right now. So, you’re basically buying it on vibes.

If you buy it—it’s trading at $1.40—if it goes to $1 and you buy it for a pop up to $2, you’re buying it based on vibes. You’re buying it based on technicals. You’re buying a chart. You’re not buying a project’s actual fundamentals.

So, again, Avi, you’ve got enough experience doing this and probably a good enough gut feel for crypto that that may work for you. But I would not recommend doing that for most people, and I certainly won’t be doing it myself, because to me, this is just another example of TRUMP coin.

This is a project whose token is, as of right this moment, unlinked to anything real. It’s more of a memecoin than a Hyperliquid-like vehicle that buys back tokens with business revenues. Sure, it may become that one day, but it isn’t yet. And even if they announce that they will, they only have a couple of days of being live to demonstrate it.

For me, watching what happened to TRUMP coin, I just don’t know. There is no way to value this thing, and so I think it’s important to avoid FOMO or chart trading.

I guess I mean, don’t get one-shotted by this idea of revenue, Jonah. There are still good trades out there.

But why 1 to 2? To me, these are not objective frameworks. And yes, I agree it’s not just revenue that matters. I’m perfectly happy to invest in things on vibes and memes and just YOLO in and out of stuff.

But this thing’s been around for a day.

That’s exactly why I like to look at the new things for trades: because it’s been around for a day and because it moved so quickly, so fast. A lot of people ended up on the sidelines, and I think that lends itself to becoming a good trading asset, right? I think that’s where maybe we differ: that actually makes it a good trading asset to me.

But look, I’m definitely on your side. I think that, again—okay, so if you go to the website itself, I don’t know if anyone’s actually gone to the website other than just trading the coin. It’s not a particularly good webpage. That was insane, by the way. I wish I could share my screen right now so people know I’m not joking about this. Hold on. I’m going to share my screen.

I can’t wait to see this.

Hold on. I can’t share. As we’re talking about this, somebody just texted me, “Have you heard of Aster?”

We can hear—I know somebody texted you because we can hear your text messages in the background. You’re like an old man. My mom turns the text-message ringer on.

Yeah, but that’s crazy. Somebody literally just texted me about this, which brings me back to the point: when you get an asset that comes out and rips really hard and nobody gets in, it does generate FOMO on pullbacks, and you can sometimes take trades out. That’s all I’m saying.

That’s a good trade.

But if you actually look at the website and the app itself, it’s kind of shit. It also just doesn’t really make sense. A tremendous amount of wash trading has to be happening on this platform because it says it has $258 million of open interest.

Yours? No way. Unless it’s all CZ.

And it says it has $532 billion in total trading volume. Jonah, what is that ratio?

No way.

What is that ratio?

That ratio makes no sense. It’s potential fraud.

I mean, that’s crazy.

What else could it be?

That sets off my antennas. That’s got to be the highest turnover in the history of any exchange launch ever. If it’s real, honestly, where I’m at with this is that all crypto Twitter is picking up on it. Let’s just, for comparison’s sake, go to Hyperliquid.

Yeah.

Today, on $3.8 billion of open interest, they have $4.8 billion of volume on Bitcoin. On Aster, they have $236 million of open interest on Bitcoin, which is actually more than what they said they have on their homepage, but let’s put that aside for a second: $2.2 billion of 24-hour volume. So they have literally 1/20th of the open interest but half of the volume. That doesn’t make any sense.

No, it doesn’t. The trading opportunities that you mentioned, Avi, have nothing to do with the fact that this is a DEX, a clone. There’s nothing special about this. There’s nothing uniquely valuable here. It’s just an insanely volatile asset. It went up. It created a lot of wealth over an extremely short period of time.

So if you go and annualize that volatility, it’s so freaking insane that it attracts retail traders. To me, that is it. There’s also a CZ story behind it, too. Everybody loves the mythology of the hero who’s just returned from his exile to save humanity from the forces that want to extinguish crypto. So there’s definitely a CZ meta here, and maybe you can profit from the high amplitude of this thing.

If it trades down another 50%, you just compare where it started to where it peaked out, and yes, it seems like there’s probably a range-trade opportunity to buy the dip on it. The reason why I hate these trades, though, is because they can nuke you so badly. People who invested in Trump on a similar volatility thesis ended up losing 60% to 90% of their money in very short order.

So I think what’s underrated in this market is the ability to just maintain your patience and your calm and your vision for your portfolio and not get distracted. To me, this is the ultimate shiny object that distracts you out of good long-term positions. I’m more of a long-term trader, so I don’t like things like this. This bothers me.

Another thing that bothers me is that on their website, next to the section that says “Perpetual,” there’s a section that says “1,001x.” Why 1,001x? Why not 1,000x? They’re trying to copy us, Avi. What are these people doing? So basically, you’re on mute.

They’re trying to one-up us, Jonah.

Trying to one-up us. Why not? They should have put 999x on there just to be respectful. Have some respect for our moves.

This is a shiny object. The logo is a logo of a shiny object. I bet we won’t be talking about Aster in 6 months. How many exchanges are in the graveyard? That’s what made Hyperliquid so hard. It was obviously a good product. I missed the no-KYC, but how many exchanges are in the graveyard? Do you remember back in 2021 how many exchanges there were?

It was more than 100, I think.

2. Ads (Kraken OTC, Peaq, Katana)

It was crazy. It was a lot. I want to see some new ideas in crypto, not just more exchanges and more copycat versions of previous products.

3. TradFi Catnip & Crypto Equities

Maybe we’ll do a segment next week on all the new stuff. I’ll put out some feelers to figure out what else is being built right now. One thing that’s absolutely getting all the hype is the new stablecoin products that are coming out. You have Stable and Plasma. Maple is generating a decent amount of hype off of this, too. I don’t know if you saw their pool that got filled, the syrup USD pool.

I didn’t.

That got filled in 30 seconds. It was like $200 million worth or something like that. Basically, I think stablecoins are going through what I would call a renaissance right now. I think they’re absolute catnip for TradFi investors.

In the same way that Ripple is catnip for a TradFi investor, which is why I really like the idea of Plasma doing very well over the coming few months. Once it goes live and once it’s across more exchanges—because right now you can only trade it on Hyperliquid because it’s not actually launched yet—I think it’s going to do extremely well. I think people in TradFi are probably going to try to pile into this thing.

You bring up a really interesting point, which is the catnip for TradFi investors. That’s what the market’s telling you is where you should put your money. You should put your money in front of or alongside TradFi. You should not put your money in things that TradFi won’t touch, like Aster. Let me give you an example—a concrete example: Galaxy stock.

When are you going to stop coming at me for this Aster take? I just said trade it. Look, I—

I’m talking with you.

I respect your opinion. I might differ, humbly and respectfully, on Aster. I think that is a nuclear cesspit with a gigantic avoid sign, with a nuclear logo in yellow and black next to it. But anyway, you might be right. If you’ve had success trading short-term charts out there with insane volatility, do it.

Value & Momentum

It’s not my thing. It’s an obvious thing. But Galaxy, just to give you guys a concrete example of TradFi catnip, used to be such that when Bitcoin was down 1%, Galaxy was down 6% because it was on the random Toronto Stock Exchange and was basically a beta play to crypto. It was Mike Novogratz’s Bitcoin, but IPOed in Canada, and in 2021, crypto things with business-looking tendrils attached to them would get a huge multiple. Then, in 2022, they would get a discount.

Galaxy was just this massive, volatile beta-to-Bitcoin thing. Now, today, Bitcoin’s down 2.5%, and Galaxy is down 43 basis points. The crypto equities with crypto-adjacent themes—or, better yet, AI, like what Galaxy has with its data centers—to me, that’s a place where you can buy.

If Galaxy were to really nuke right now on crypto just selling off as liquidations occur, the relative price action is telling you that Galaxy will outperform on the upswing because of who’s trading it, right? Then there’s another one that—I’m sure XRP, when it IPOs, will probably trade the same way, or Ripple equity, rather.

I think the market’s telling you, in that one little example I just gave, everything you need to know about where the fresh dollars are coming from. They’re not coming from the strung-out people in our world. They’re coming from these new traders who are backstopping stablecoin equity, backstopping Galaxy, even while XRP is down 4%, HYPE is down 5%, and ETH is down 6%.

It’s crypto equities where it’s at right now, weirdly enough. Maybe we’ll get a crypto equities season.

4. DAT Management Matters

Yeah, I mean, one thing that haunts me, Jonah, is that at the bottom of the market post-FTX, I put a substantial amount of my capital into miners and GBTC. I sold it all for like a 2x, and all of these miners have done like 10x since then. I’m like, wow, I would have been so rich if I had just kept those positions. Many such cases.

Yeah, crypto equities in general, I think, are going to do very well over the coming months.

Value & Momentum

Exactly. Because of what you just outlined, I put a flyer on Nakamoto, which absolutely collapsed, I think mostly because of mismanagement, huge amounts of shares hitting the market, an inability to raise capital, and I plowed in.

Nakamoto, for those that don’t know, was the David Bailey DAT. It’s trading below NAV, and I think this is the first, quote-unquote, implosion of a DAT that we’ve seen. And Jonah, if you remember, we were talking about these being good pickups if they got to reasonable discounts to NAV. Right now, this one’s at about a 35% discount to NAV.

And it’s trading very close to the insider price. The insider price was $1.12, and they’re still locked up. It’s trading at $1.33 right now, so it’s pretty close to the insider price, which makes me think that we could be due for a nice little short squeeze or a nice little bounce.

Basically, I think in this pullback, we’re probably going to get more of this stuff, and it’s worthwhile looking out for. One thing I’ve found kind of interesting, though, is that the competency of the people running the DATs really does matter. Performance really does depend on that, is what I was trying to say.

Something like BMNR, for example—BitMine, Tom Lee’s thing—has not seen that massive collapse in the same way that Nakamoto did. I think it’s sort of inevitable that it will at some point, and that’ll be an even better buy than Nakamoto because it’s actually run well.

But I love it when we plan out a trade months in advance and then it starts to give you opportunities to get in. It’s like, okay, well, I know what I’m getting into now.

Yeah. You just lie and wait. Where are you getting the insider price for Nakamoto? That would be an interesting thing for the listeners to hear and do some research on themselves. Like you said, the insider entry point was $1.12.

Value & Momentum

I got that number from somebody that did the deal.

Okay. I was going to say I was unaware of any public repository of that data, but that’s pretty cool. So I think the trade is basically: pick the DATs that aren’t going to miss coupon payments and be forced to sell crypto when they trade to a discount, then buy them and hope they have the staying power to ride it back to par.

Again, like you said, you have to assess the teams and the financials. That’s real equity analysis, but I’m sure 1000x listeners can probably do that. Some of them can, and maybe post their analysis on Twitter after they’ve gotten their positions. I think that’s probably something to look out for.

One other thing that’s kind of on my radar right now, just in broader crypto, is doing that with Hyperliquid if I can. I think if this altcoin sell-off becomes really acute, we may get another April-like opportunity to scoop that thing.

I really like it. Everything is shanking much harder than I expected in altcoin space. Even PUMP might be another great one to do that on. HYPE and PUMP are these 2 amazing money machines. It’s fine not to be early as long as you lie and wait when shit really hits the fan, like it looks like it’s about to.

5. Capitalizing on Crypto Repricing

So, yeah, I think that’s probably the reason to have less than 100% of your portfolio allocated: just so that you have dry powder to buy these dips, not because timing a short trade is going to work particularly well. I don’t know how long—I wouldn’t feel comfortable being short for more than a few days at this point, because it does feel like a liquidation trade, not like a structural repricing lower of crypto for some meaningful, bigger reason, like what we saw during the Elizabeth Warren era, FTX, or Luna.

6. Making Money in Crime Season

Do you think that crime season, which does kind of seem to be making a comeback here, will actually reprice crypto lower? Is there any risk of that? We’re not calling Aster a scam or anything, but if the fishy-smelling projects continue to smell fishier, will we end up in a scenario like we saw in May 2022, when Luna did so much damage to the price of so many projects as people realized that it was a house of cards? Do you think there’s any risk of that at this point?

Value & Momentum

I mean, I don’t think so unless something truly horrendous happens. For example, a project could be fully exit-scamming or get rugged. I just don’t see it as an existential risk until we get the next Democratic administration, which hopefully won’t be for a while.

But where I thought you were going with this is, is crime season going to continue? My answer is yes—hugely. There are ways to make money off of it. If the US government is going to do something involving a stock, they’re going to make sure this thing goes up.

The initial reaction to Intel and the 10% stake, I don’t think, factored in that Trump was probably going to broker some other deals. Good stuff was coming for this stock. Your takeaway from this can be that if the US government is involved with a stock, you can read into that and think to yourself, okay, maybe this thing is going to do pretty well.

One thing I did—which I got lucky about, but then doubled down on this morning—is Tesla. I told you guys that I bought Tesla a little bit ago. I bought a lot more this morning specifically because there was that shot of Elon Musk and Trump sitting together, and Trump saying, “I miss you.”

The lip reader.

Value & Momentum

Yeah. And you can see it. It’s pretty clear, and you’re just like, okay, clearly Trump and Elon are back on good terms. Probably going to be good for the stock, right? I don’t know exactly what’s going to happen there, but I think at some point over the next 6 months, it’s probably going to be good for Tesla stock.

I don’t think the market’s going to crash anytime soon, so Tesla can probably outperform. You’re basically looking for who’s most likely to benefit—what stocks are most likely to benefit. And that, I think, is going to be a big part of trading moving forward.

Bitcoin is part of this, which is why I think there’s a little bit of a floor: Trump has staked his reputation in some way on crypto. There is some floor level on Bitcoin where crime will take place and Bitcoin will go up again.

Yeah, I mean, he did. My take on it is that when he got elected, he was tweeting, like, “You’re welcome, Bitcoiners. See, this is what happens when you put your chips in my corner. I deliver.”

So, yeah, I do think that he’ll probably accumulate some Bitcoin if it goes too low or backstop it somehow. His kids are all in on crypto. To me, the corruption is just so palpable. Crime season is really the meta right now. And I think other ways to profit from it are probably just dip-buying. It’s all just dip-buying, isn’t it, Avi?

I mean, there are basically—I think the best ways to play crime season are BNB, because I do think that if perps become legal in the US, it does feel like Binance is going to be the primary beneficiary.

Value & Momentum

HYPE to some extent as well, but the KYC thing may block them from achieving the same kind of success from that catalyst. I also think that Ripple is a Crime Season trade. Ripple in and of itself is a totally useless company that just sells XRP, but that business will become better as Crime Season progresses into the later innings. Galaxy. I’m literally just word-vomiting, or brainstorming, what to accumulate on this dip. I guess the hardest part is going to be timing it.

7. Trade Ideas

It hasn’t dipped hard enough yet. This is the first move. I think, as a general trading heuristic, you don’t really want to fade the first move. What do I mean by this? You can think about this on a weekly time frame or a daily time frame. I’m thinking about this specifically on a daily time frame.

For example, we’ve basically been going sideways for a week. There have been 10 days of sideways so far, and today we got a reasonable 3% move down after ranging for 10 days. You tend not to want to fade those substantial moves after you’ve been ranging for a while, right? Wait to see how the day closes.

The other thing is that we’ve now solidified that 117K level as a good stop-out level. The way that Bitcoin trades, especially level to level, is that people look for symmetry in trades and they look for asymmetry in trades. For example, at 117K, it was pretty equidistant to the highs of 124K as it was to the lows of 107K. It was basically 50/50, which is why you ranged there for a while.

There was no easy stop-out or stop-in. There was no asymmetry there. It was a pretty symmetrical price level. Now you have a very easy stop-out above 117K, and you can easily target the lows here. I think that makes it a much better trade to sell here than it was to sell before.

I’m of the mindset that momentum traders, especially because of this new lower high, are now going to try to get out. You need the value buyers to come in, and I don’t think the value buyers come in until at least 100K.

Yeah, I mean, just another way of looking at symmetry is through time, right? You could compare this sell-off, which feels like it’s just getting started, to the sell-off that happened in April on the tariffs. Then ask yourself, “Okay, so these 2 sell-offs could be symmetric because you have a similar group of players, a similar leverage backdrop, and a similar average entry price now versus then.” Not a whole lot has happened since April, so it’s kind of the same setup.

Let’s just do a little measuring on TradingView. The peak-to-trough move from, let’s call it, January to the pits of Liberation Day puke in Bitcoin was 30%.

Value & Momentum

I don’t think we’re going to get anywhere close to that.

Yeah, me neither. I’m just saying, what feels like the right fraction of that sell-off for this move, which is not being driven by an exogenous potential recession event but more just a liquidation? Maybe 20% maximum, right?

Value & Momentum

Yeah, I would say 20%. That puts you at about 100K. I think 100K to 105K is a great buy, and I’m probably buying alts on that dip.

Yeah. So, a 20% sell-off from the absolute tippy-top is $99,000 a token. To me, if you trade down there, then we’re going to be having the same conversation we had in April, which is just, “Close your eyes, don’t be a coward, and buy.” But here at 112K, it’s not close enough to start putting it all out there on the table.

Value & Momentum

For sure.

That’s kind of how I would value this. Just be like, “Okay, what happened in April? There was a real catalyst then. Now there’s no catalyst.” Max two-thirds of that sell-off is appropriate, but probably more like half of it. So, 15% peak-to-trough—and just for your reference, 15% peak-to-trough would be $105K in Bitcoin—probably a good way of looking at it.

Value & Momentum

So, I think that’s good, Jonah. I’ll see you at 105K.

See you at 105K. Avi, we’ll be loading up the gun in the meantime and coming up with a shopping list. In the meantime, stay healthy.

Value & Momentum

You too. Shanah tovah.

Shanah tovah.

Value & Momentum

[Speaker?]

Happy New Year to everyone out there who celebrates. It was great talking to you, Jonah, as always.

Value & Momentum

Likewise. See you next week.