Bitcoin’s Price Going Up And Down And Up And Down A Lot Is Actually A Good Thing

00:02 Hey everyone. You probably think 00:04 that Bitcoin going up and down and up 00:06 and down and up and down in price is a 00:08 bad thing, but it's actually a blessing. 00:10 And I want to explain why. So, as the 00:12 price of any asset goes up, there are 00:15 people who want to get on and get off at 00:17 different places. So, um last year I 00:20 went, uh when I was in Dubai for a 00:22 Bitcoin conference, I went to the Burj 00:24 Khalifa, which is the the tallest 00:26 building in the world. And I can't 00:28 remember what the top observation I went 00:29 to like the very top observation floor 00:31 that you can go to and it's like 157 00:33 floors up or something. It was something 00:34 crazy. Anyway, well, let's use that as 00:37 an example. Let's think about the 00:38 elevator on the Burj Khalifa. And let's 00:41 assume that the elevator actually worked 00:42 where it could stop at any floor. Let's 00:45 also assume anytime anyone inside or 00:48 outside the elevator pushes a button 00:51 that the elevator has to either go back 00:54 and get the person or has to go back and 00:56 let them out wherever it is. So that's 00:58 the way the Bitcoin price works, which 00:60 is if somebody wants to buy it 01:03 or somebody wants to sell, it pushes the 01:05 price down. If somebody wants to buy, it 01:07 pushes the price up. Now obviously it 01:09 takes a lot of people buying at the same 01:10 time to push it up. takes a lot of 01:12 people selling at the same time to push 01:13 the price down, but that's the way it 01:15 works. So, the reason it is valuable for 01:18 Bitcoin to go up and down a lot or be 01:21 what's called rangebound, which means 01:23 it's bouncing up and down and up and 01:24 down in a relatively defined range, or 01:27 it's sometimes called trading sideways. 01:30 The reason it's valuable to if it's 01:31 trading sideways is because it 01:34 establishes a new floor for the price at 01:37 which people want to be on or off the 01:39 elevator. Let me explain. 01:43 Okay, so last year 2024, we spent seven 01:46 months with Bitcoin bouncing back and 01:48 forth between $55,000 and $70,000. Now, 01:51 you may have thought that that was a 01:54 hugely frustrating and painful process, 01:56 which it kind of was. I mean, I I'm 01:58 right there with you. It's painful when 01:59 something that should be going up is 02:02 going sideways for 7 months before it 02:03 then radically goes up. But the truth is 02:06 there was a whole lot of people who 02:08 wanted to get on or off at those prices. 02:11 So let's assume you know in a 157 floor 02:14 building like the Burj Khalifa um at 02:17 least I can't remember how high the 02:18 observation deck was. That's the number 02:20 that stuck in my head anyway. And let's 02:22 assume you know for every floor it's 02:24 like $10,000. So it's like we're on the 02:26 fifth floor, the sixth floor. The 02:28 seventh floor now back to the sixth 02:30 floor. Up to the seventh floor. Nope. 02:31 Back to the fifth floor. Up to the sixth 02:33 floor. Back to the fifth floor. up to 02:35 the seventh floor, back to the sixth 02:36 floor, and we did that for seven months. 02:38 Well, the benefit of that is that every 02:40 conceivable person in the world who 02:43 wants to get on or off the elevator 02:45 between the fifth floor and the seventh 02:46 floor had seven months to do that last 02:49 year. If you wanted to buy Bitcoin in 02:51 the 50,000s or sell Bitcoin in the 02:55 60,000s, you had seven solid months to 02:58 do that last year. And what that means 03:00 is when finally there's a catalyst where 03:03 market adoption finally pushes the price 03:05 higher, it's much more sustainable 03:08 because everybody who wanted to get off 03:10 at a higher price or or wanted to buy at 03:13 a lower price has has had the chance to 03:14 do that in that range. So what if 03:17 tomorrow the price shoots from 106,000 a 03:21 coin to 250,000 just in a day? Boom. 03:24 That's not going to happen. It takes 03:25 longer for that something like that to 03:26 happen. Let's assume it happened in a 03:28 day. The first thing that would happen 03:30 is you would be completely euphoric. You 03:31 would think, "This is amazing. I love 03:33 it. This is the best thing ever because 03:34 all your Bitcoin would be up, you know, 03:37 150% from its current price. But what 03:39 would immediately happen after that is 03:41 all of the people who were willing to 03:43 get off at any of the floors between 03:46 here and 250,000 would start selling. 03:50 So, for example, you know, I've been 03:52 saying for a while now, at some point, 03:54 I'm going to buy a Tesla Model Y, the 03:57 latest Juniper edition of the Tesla 03:59 Model Y, and but I don't want to pay 04:01 more than half a Bitcoin for it. So, you 04:04 know, if that car costs, I don't know, 04:06 60 with with full self-driving and 04:08 everything. Let's say it costs $70,000, 04:11 $60,000, I don't know what. Well, that 04:13 means somewhere between 120 and 140,000 04:16 a coin, someone like me wants to 04:19 liquidate half of a Bitcoin and buy a 04:21 Tesla model. Why? Because my family 04:23 needs another vehicle cuz one of my kids 04:25 is turning 16. They're getting a job. We 04:27 need another vehicle like and I want to 04:29 drive a Tesla and I've always drive 04:31 driven old junk cars and at some point, 04:34 you know, Teslas are super cool and they 04:36 drive you everywhere. full self-driving. 04:38 Like, it's just really cool that you can 04:40 literally not touch the steering wheel 04:42 or the pedals and the car will take you 04:43 anywhere. So, if we shot tomorrow to 04:46 $250,000 instantly, the problem is that 04:50 means there's a bunch of selling 04:51 pressure that has yet to unwind. There's 04:54 people like me out there thinking, 04:56 "Uh-oh, wow, that happened fast. I guess 04:58 I ought to get around to picking what 05:00 Tesla Model Y 2025 Juniper Edition I'm 05:03 going to buy." It might take me a week 05:05 or two to figure that out. But the point 05:07 being is there is half a Bitcoin in 05:09 selling pressure out there waiting 05:11 unless I decide to finance it. I'll 05:13 probably finance it. That's sort of 05:14 borrowing US dollars and saving Bitcoin. 05:16 So, I'll probably finance it. But let's 05:18 assume I wasn't going to finance it and 05:20 I was going to straight up buy a Tesla. 05:23 Well, that means there's half a Bitcoin 05:24 that someone like me is planning to sell 05:26 that has not happened yet. which means 05:28 that $250,000 price is not necessarily 05:32 stable because as the, you know, the 05:34 elevator shoots all the way up to the 05:36 250th floor. Again, I know in my 05:38 example, the Burj Khalifa doesn't go 05:40 that high, but let's assume it did. You 05:42 know, it shoots up to the 250th floor. 05:45 There's a bunch of people punching those 05:46 elevator buttons saying, "No, I wanted 05:48 to get I was willing to get off lower 05:49 than this." And that's going to push the 05:52 price back down. Now, everybody's going 05:53 to try to get off at the 250th floor. 05:56 Uh, but as people get off, the the 05:58 elevator is going to go down because the 06:00 selling pressure is going to push it 06:01 down until the buying pressure holds it 06:03 back up. So, I know it is super 06:05 frustrating for Bitcoin to be rangebound 06:08 or trade sideways or grinding sideways 06:10 or whatever you want to call it, but 06:12 it's actually extremely valuable for the 06:14 asset because it means a lot of the very 06:16 early people that uh you know that 06:18 bought Bitcoin at $10 or $10,000 or 06:21 $1,000. They had seven months last year 06:24 to get off the train, you know, buy 06:26 whatever they were going to buy, put an 06:28 expansion on their house, buy a boat, 06:30 buy a car, send their kids to college, 06:32 whatever it is that might cause them to 06:34 liquidate Bitcoin, they had 7 months to 06:36 do that last year between 55,000 and 06:39 70,000. So the same is true now. The 06:41 longer we spend bouncing between 90,000 06:44 and 110,000, 06:46 the more opportunity. It's like, hey, 06:48 you want to get off of the ninth floor, 06:49 10th floor, 11th floor? How about the 06:51 ninth floor? 10th floor, 9th floor, 11th 06:53 floor, 10th floor, 9th floor, 11th 06:55 floor, 10th floor. Like, however long we 06:58 stay in the 90,000 to $110,000 range, 07:02 that is how much opportunity everybody 07:05 that wants to buy in the '9s gets to 07:07 buy. Everybody wants to get off above 07:09 100,000 gets off above 100,000, which 07:12 ultimately makes it just a lot more 07:14 stable. it sort of builds a foundation 07:18 that is a lot more sustainable than if 07:20 it's just bouncing around up and down, 07:22 sort of shooting up, shooting down. So, 07:25 an example of this was 2017 and 2011. In 07:28 both 2017 and in 2011, the price of 07:32 Bitcoin shot up. Sorry, what I said 07:34 2017, I didn't mean 2011. I meant 2021. 07:38 Sorry. Same thing happened in 2013. The 07:40 last years of bull markets, the 07:43 strongest bull markets, which is every 07:45 four years, which should be this year, 07:46 but it was 2013, 2017, 2021 should be 07:49 again in 2025, you know, four-year cycle 07:52 is sort of Bitcoin's natural cycle due 07:54 to the having and other factors. If you 07:56 want to understand that, read the 07:57 bullish case for Bitcoin by VJ Boya. Uh 08:00 that is the the bullish case for Bitcoin 08:03 by VJ Boya. If you want to understand 08:06 the four-year having cycle and why 08:08 Bitcoin goes up and down on its way up 08:10 in the long term, not just in sort of 08:12 the choppy days and months, but why it 08:14 goes up in these cycles over four years. 08:17 Um, and this should be the the best of 08:19 the four-year cycle. If you want to 08:21 understand that, read BJ Voyati's book, 08:23 The Bullish Case for Bitcoin, and you'll 08:26 understand exactly why that is. My point 08:28 is in 2013, 2017, and 2021, at the very 08:33 end of those bullish cycles, the price 08:35 shot up so radically. I mean, literally 08:38 going from a few thousand to $20,000 in 08:41 2017 or from going from, you know, a low 08:44 of four, four, five, whatever thousand 08:47 in 2020 08:49 up to 69,000 in 2021. with those radical 08:53 price gains, there's just not a lot of 08:55 opportunity for people to get off or on 08:57 the train. And so what ends up happening 08:59 is you end up topping out. You end up 09:01 spiking super high, but then you know, 09:04 not crashing crashing, but you end up 09:06 having a pretty big price correction off 09:08 that incredible high because that 09:10 incredible high just was not sustainable 09:13 because it went up so fast that there 09:15 were a bunch of people willing to get 09:16 off at those prices. They just were. One 09:19 second. 09:23 So, nothing would make me happier than 09:25 to grind sideways or trade sideways at 09:29 any price that's above $90,000. 09:33 I certainly don't want to go back to 09:34 grinding sideways between 55,000 and 09:36 70,000 because we already did that. 09:39 We already did that. So, I don't want to 09:40 do any more of that. I feel like if 09:42 anybody wanted to get on in the 50s or 09:44 off in the 60s, they had seven months 09:46 last year and I don't want to repeat 09:47 that. If we end up grinding sideways 09:50 between 90 and 110 or between 120 and 09:54 140 or between 180 and 220, 09:57 that is a very good sign because it 09:59 means the ability to maintain and 10:01 sustain those prices is much higher than 10:04 if we all wake up tomorrow and Bitcoin 10:06 just goes on an insane tear just 10:09 shooting for the stars, which again 10:11 feels great. It feels euphoric, but it 10:13 also the faster it goes up, the faster 10:16 in the near term it can come back down. 10:18 Now, long term it doesn't matter because 10:20 long term it's going to go up and up and 10:21 up and long term it'll go past a million 10:24 dollars a coin and probably way past a 10:26 million dollars a coin. So, in the long 10:27 term it doesn't matter, but in the short 10:28 term um you know, you want that trading 10:32 sideways. You want that grinding because 10:34 it it establishes a new floor for what 10:36 this asset is worth. and then we can 10:38 build on a much more solid foundation 10:40 than if we just shot for the moon in a 10:42 day. Uh so anyway, hopefully that 10:44 perspective is helpful and hopefully it 10:46 helps you appreciate it when Bitcoin 10:48 just seems to grind and it's up again, 10:50 down again, up again, down again, up 10:51 again, down again and you're like, "Oh 10:53 my gosh, this roller coaster is giving 10:55 me nausea." The answer is no. It's doing 10:57 a really good job of getting everybody 10:58 who wants to get on or off an 11:01 opportunity to do that to set a really 11:03 strong floor so that the next move price 11:06 move