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“Fed Watch” is the macro podcast for Bitcoiners. In each episode, we discuss macroeconomic news from around the world, with a focus on central banks and monetary issues.
In this episode of the “Fed Watch” podcast, I sit down with Your Go, a real Bitcoiner and longtime Bitcoin price and macro analyst. Our discussion ranges from current conditions to bitcoin cycles to broader macro topics including the state of US politics, Europe and the euro.
You can find the graphics for this episode here.
Current Bitcoin Market Conditions
In the first segment of the podcast, Vays talks about the psychological state of the bitcoin market.
“I was there for the last two bear markets. 2013 was the classic bubble chart, you were mentally prepared for what was to come. 2017, again ICOs, it was an unreasonable exponential increase, so you were mentally prepared. I was not mentally prepared for this one. Because when the peak came in April 2021, we had an incredible amount of good news. Michael Saylor, Elon Musk and Jack Dorsey quit Twitter to get into bitcoin with Square [now Block]El Salvador [legal tender law]then El Salvador buying bitcoin.
“It turned into an info-selling event. 50% correction, it does not matter. Everyone was mentally fine with it. Then this is where it all depends on your mental state. When we came back and broke that top in November it was the to burst. Everyone thought we were going higher; I thought we were going higher. This fake outing in November was mentally brutal. We got back to the $30,000 low, fell to $20,000, and over the last three to six months people have been very, very worried.
“This extended move has caused people to tighten their belts. Mentally, they feel like they’ve been cheated and don’t think bitcoin should be at these low levels. Bitcoin was built for this world that we see right now with all the uncertainty. They steal bank accounts not only from individuals, like in Canada, but from sovereign countries. Bitcoin was designed for this, but the price keeps dropping. People are starting to throw in the towel. Everyone says lower, lower, lower. This is where I have to believe the majority is always wrong.
I asked Vays about bitcoin valuation patterns and four-year cycles. My question is if they are all broken and if a new model needs to be found.
He said he thinks models always fail. Stock-to-flow is theoretically correct in Vays’ mind, but it cannot be successfully used as a technical indicator. As for the four-year halving cycle, Vays believes it is partly due to hype and partly to actual supply shocks.
This is also my position here on “Fed Watch”. The four-year halving cycle has its own hype cycle, completely separate from the overall bitcoin hype. naturally through the halving.
However, I think the hype wanes with each cycle, along with the aspect of supply shock. That’s why I now believe we kind of have a two-year cycle. A lesser effect of the halving but still reverberating years later.
Vays insightfully points out that there is much less of a clear distinction between bull and bear markets. Price action in 2020 and 2021 does not lend itself to a clear dividing line. In the future, it will become more difficult to delineate these cycles.
European Crisis And Global Macro
We started running on our hard time limit before getting into the juicy stuff, so hopefully we can get Vays back in a few months to continue this discussion. But we had his opinion on Europe and the euro.
“I will say that I have a very low opinion of Western Europe. It’s good; you go there and that’s for sure. You can walk down the street; you feel pretty safe. It has remnants of a collapsing capitalist society, as they hand over all power to the World Economic Forum (WEF). I believe that the WEF is a liberal and socialist organization. They control politics too much. To quote Klaus Schwab, “We broke into the cupboards.” And they did.
“I think the path of the WEF is a very, very dangerous path, and I short-circuit the future of Western countries that embrace its power. That’s why I’m very bearish on Europe. I think the common currency will burst.
We talk about much more, from the correlation of bitcoin to stocks and altcoins, to monetary policy. It’s one of my favorite episodes we’ve ever done on “Fed Watch,” so it’s definitely a must-watch.
That’s it for this week. Thank you readers and listeners. If you like this content, subscribe, review and share!
This is a guest post by Ansel Lindner. The opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.