Rent Free
Daily Ramble
Elon has been living in my head rent-free. Watching one of the world’s most influential people getting spun out by the Bitcoin cyber hornets has been a popcorn-munching moment. And classic. Everything with Elon is on a planetary scale. Why shouldn’t his meltdown be as well?
Here’s a link to a Twitter thread by Jack Mallers, founder of Strike, that breaks down most of the drama.
There’s plenty of folks discussing Elon’s tweets and their meaning, but that’s not my angle here. What I want to focus on is the Bitcoin hero-to-villain archetype. Bitcoin has this funny way of destroying its unhumbled heroes. Over and over throughout its history, big fish have jumped into the Bitcoin pond. The pond initially welcomes their entry positively. But eventually, the big fish starts doing big fish things, not realizing that different rules govern the Bitcoin pond. Big fish are used to being big fish, after all. However, the thing that keeps the pond united — Bitcoin — cannot be influenced by any of the fish in the pond. The big fish has never experienced this before. He tries (sorry ladies, it’s always a “he”) his big fish tactics, but the pond only bellyaches and groans at his attempts to exert influence. That frustrates the big fish because the pond doesn’t react as he wants or anticipates.
He ramps up the big fish efforts, but the pond moves from bellyaches and groans to attacking back. It only escalates from there, with the result being an ego meltdown, as the Bitcoin community turns on its once welcomed hero who didn’t take the time to learn the rules of the new pond. The big fish grows silent and resentful, attempting to learn the rules he clearly didn’t understand. Or he leaves the pond entirely in some face-saving manner, lacking the imagination to believe there are aspects to life beyond his control. The rest of the pond does not care either way. They welcome his exit or his re-education.
If he exits without the humility to pursue re-education, there’s no hope that he’ll get to experience the Bitcoin prodigal son archetype. Craig Wright is the ultimate example of someone who took his marbles and ran home when he couldn’t control Bitcoin. His importance has diminished to a nothing burger at this point. The flipside is Michael Saylor, who is Bitcoin’s most prolific prodigal son. Michael publicly denounced Bitcoin many years ago and had nothing to do with it until last year when he realized Bitcoin’s continued and growing presence meant he’d missed something. He studied, learned the rules of the Bitcoin pond, and jumped in eagerly, joining with the rest of the fish in their Bitcoin fun and games. By learning the rules of the Bitcoin pond, the rest of the fish have welcomed and propagated his ideas and thoughts.
Moral of the story: be like Mike.
Favorite Things on the Interwebs Today
Bitcoin Price Prediction
Weekend: $47k - $54k
Today: $39.2k - $46k
Tomorrow: $39.2k - $46k
I continue to underestimate the havoc of Elon Musk's tweets on the Bitcoin market. Over the weekend, Elon’s tweets sent the market into sell mode again. The dust is still settling, but the price has reached as low as $42k in the current pullback. That makes it a 35% pullback from the $65k peak put in a month ago. As insane as it may sound to people joining the Bitcoin market for the first time this cycle, this is exactly the type of pullback experienced in the previous cycle — in fact, there were 6 pullbacks like this. I’m trying to say that while the price is down substantially, this is still normal behavior for Bitcoin in a bull market. I mentioned last week that the weekly price closing over $46k was critical, and it did. A close over $46k this week continues to be critical, even if the price goes well below throughout the week. There is substantial downward pressure right now. I don’t anticipate going much over $50k at the maximum this week. The market needs to resettle.
TL;DR Bitcoin is down, but not out.
Bitcoin Q & A
Q: Can Elon Musk or any other individual destroy Bitcoin?
A: No.
No individual has power over the Bitcoin network…not even Elon Musk. Despite his tremendous influence over many people, he cannot stop individuals from participating in the Bitcoin network. The ability to be beyond the reach of the smartest and most influential people is what makes Bitcoin antifragile. Math doesn’t care what humans think.
Thanks for reading,
Kent
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