Is Bitcoin’s price “stuck“ at $107,000? No. The “realized cap“ realized capitalization is changing

00:01 Hey everyone. Is Bitcoin's price stuck 00:04 at $107,000 00:06 or is something going on behind the back 00:08 uh behind the scenes and in the 00:09 background? The answer is a lot's going 00:11 on behind the scenes. Let's talk about 00:13 it. Okay, so first off, Bitcoin has been 00:16 at $107,000 for about four or five days 00:19 now. And it's been around somewhere 00:22 between $100,000 and $111,000 00:26 for what feels like months, for it has 00:29 been a good a good portion of the last 6 00:31 months. Okay. So, what's going on here? 00:33 Well, anytime the price of any asset, it 00:37 doesn't matter if it's one of the 00:38 magnificent seven stocks, which is 00:39 Apple, Amazon, Tesla, Apple, sorry, 00:42 Apple, Amazon, Tesla, Facebook, um, 00:45 Microsoft, Google, and Nvidia. I think I 00:48 got all seven. Anyway, it doesn't matter 00:50 what it is. If something goes up very 00:52 quickly, then it takes time for the 00:55 market to digest it. And we need to talk 00:57 about what's happening actually behind 00:58 the scenes when the market is digesting 01:01 a price move like that. What's happening 01:03 is the asset is changing from the hands 01:06 of people who held it below uh earlier 01:08 at a lower price to people who are 01:11 buying it now at a higher price. Uh it's 01:14 called the realized capitalization. So 01:16 you got to understand the difference 01:18 between the market capitalization which 01:19 is called the market cap and the 01:21 realized capitalization which is called 01:23 the realized cap. Okay. So the market 01:25 capitalization 01:27 of any asset is the price at which it 01:30 last traded hands. So, the very last 01:33 Bitcoin that someone sold to one person 01:35 or another was at $107,300 01:39 when I started this video. Okay? But not 01:41 every Bitcoin has been bought or sold at 01:44 that price. In fact, some of the very 01:45 earliest Bitcoin have never been sold at 01:47 any price. So, the realized 01:50 capitalization of that very early 01:52 Bitcoin is $0. Some of the Bitcoin I own 01:55 I bought for $6,400. 01:57 the realized capitalization of that 01:59 Bitcoin is $6,400 because I've never 02:02 sold it. Um, so most of the Bitcoin I've 02:06 ever bought, I've never sold. And so I 02:08 carry it at a price that is 02:10 significantly lower than today's price. 02:12 Now, every time I use my Coinbase debit 02:14 card, the realized capitalization of 02:17 whatever Bitcoin I'm spending jumps up 02:20 to the current price. Um so the realized 02:23 capitalization of any asset is always 02:26 significantly below the current market 02:28 rate. But what matters is where is it 02:31 going? What's happening with that 02:32 realized capitalization? And then the 02:34 answer is with Bitcoin, it's going up 02:36 and it's climbing and climbing and 02:37 climbing because at times of chop 02:40 solidation or consolidation, whatever 02:43 you want to call it, what's actually 02:44 happening behind the scenes is people 02:46 that have held the asset for a long time 02:48 are selling it a portion of their 02:50 holdings to to new people. Now, you 02:52 think you might think that's annoying. I 02:54 wish everybody who had ever owned 02:56 Bitcoin would stop selling it so the 02:59 price would have to go up. Well, the 03:01 truth is you're going to do the exact 03:02 same thing. The $10,000 of Bitcoin or 03:05 $50,000 of Bitcoin or $1,000 of Bitcoin, 03:08 however much Bitcoin you own right now, 03:11 when that has increased in value by a 03:13 factor of 10 or a factor of five or a 03:15 factor of 20, you're going to be feeling 03:17 rich or richer than you are right now. 03:20 And what people do when they feel more 03:23 wealthy is they spend some. So, if you 03:26 buy $10,000 of Bitcoin and it goes up by 03:29 a factor of five over the next five 03:30 years, you're going to be sitting on 03:32 $50,000 and you will find it 03:34 irresistible to spend a little bit of 03:36 that taking your family to Disney World 03:38 or going to Universal Studios or taking 03:41 some other nice vacation or something 03:42 like that. In my case, even though I am 03:45 a net buyer of Bitcoin, um, all the way 03:47 up till I reached 100% earlier this 03:50 year, and I've made two purchases since 03:52 then, one for $14,000, the other for I 03:56 think it was like $11,000. I forget what 03:58 it was. Anyway, I posted them to 03:60 Facebook. I made two uh larger 04:02 purchases, but otherwise, I'm buying bit 04:04 Bitcoin every two weeks with my 04:05 paycheck. Um, so I've been a net buyer 04:08 of Bitcoin, but let's assume I wasn't. 04:10 Let's assume that whatever it was, 04:12 $14,000 and $11,000 or whatever it was 04:15 had not come out of nowhere enabling me 04:17 to buy more Bitcoin. Well, someone like 04:20 me up at $107,000 04:22 feels like, for example, I can afford a 04:24 Tesla. So, I bought a Tesla. Now, in my 04:26 case, I financed the Tesla, which means 04:28 I did not have to sell Bitcoin. I just 04:30 have to sell a little bit of Bitcoin 04:32 once a month for 5 years. Um, but if I 04:34 had bought it just outright, that would 04:37 have been sell pressure on the 04:38 marketplace. I actually did buy outright 04:41 a generator for my house. So now my 04:44 electricity will stop constantly going 04:45 off. Um, and that was $20,000 for a 04:49 whole house generator that can handle 04:51 three air conditioners and a Tesla 04:52 charger and all that. Uh, it was $20,000 04:55 for a colar uh 26 kilowatt hour or 04:58 something like that. I don't know what 04:59 it was. Anyway, but if I had just, you 05:02 know, let's assume I was not a net buyer 05:04 of Bitcoin. I was just an early OG 05:06 Bitcoiner, which I'm not. I'm 2017 05:08 Bitcoin, which is later. Um, but 05:11 everybody feels late, including the 05:13 people buying right now, including me in 05:14 2017. Um, let's assume I had some 05:17 Bitcoin I had bought for an average 05:21 price in 2019 and 20 or sorry, 2018 and 05:24 2017 of $10,000, which was around the 05:27 price I was spending back then, maybe 05:29 about $9,000. Well, once you're up 10x 05:31 on that money, suddenly you feel like 05:32 you could afford a generator and you 05:34 think, "Okay, I'm willing to part with a 05:36 little bit of my Bitcoin stash to buy a 05:38 generator." Well, that creates sell 05:40 pressure. Well, every time the market 05:42 goes up, people who have held Bitcoin a 05:45 long time decide to part with a little 05:47 bit of their stash to improve the lives 05:49 of themselves and their family. They go 05:50 on vacations, they buy generators, they 05:52 buy Teslas, they do all the things 05:55 people do. Now, I live a pretty modest 05:57 lifestyle, but if Bitcoin was, you know, 05:59 below $30,000 per coin, I would not be 06:02 driving a Tesla 06:04 because even though I could technically 06:05 afford it, I just wouldn't feel good 06:07 about it. Um, so every time the price 06:09 rises to a new level, as Bitcoin did 06:12 back in November, it takes a while for 06:15 everybody who wants to liquidate just a 06:18 little bit of the Bitcoin they've been 06:19 sitting on for a long time, uh, to 06:22 liquidate that Bitcoin, and then the 06:24 price continues to go up. And that will 06:26 always be the case, and that will be the 06:27 case with your Bitcoin as well. So maybe 06:30 you liquidate a little bit of your 06:32 Bitcoin at $500,000, maybe it's a 06:34 million. But for people who bought 06:36 Bitcoin at $100 or $1,000 or even 06:38 $10,000, some of them are liquidating a 06:41 little bit of it right now. And that's 06:43 actually a good thing because if they 06:44 weren't, then you would be stuck buying 06:46 the Bitcoin you own at a much higher 06:48 price than whatever price you paid for 06:50 it. So in my case, I'm glad back in 2017 06:54 and 2018 and then subsequently in 2021, 06:57 2022, 2023, 2024, and 2025, which were 07:01 all the years I was buying Bitcoin, I 07:03 should have been buying Bitcoin in 2019 07:05 and 2020. I wasn't. I should have been, 07:08 you know, my bad. I hadn't done the work 07:10 to understand it. Um, but I'm glad 07:14 people back then were selling Bitcoin to 07:16 make their lives of themselves and their 07:17 families better because otherwise I 07:19 would have had to pay a much higher 07:21 price. And the same with you. You should 07:23 be thankful that those people are 07:24 selling Bitcoin now because it's the 07:27 only reason that you got to buy Bitcoin 07:29 at whatever price you paid for it and 07:30 not a price that is radically higher. So 07:34 what happens over time? Well, what 07:35 happens over time? Uh, for example, 07:37 yesterday 40 billion dollars of Bitcoin 07:40 changed hands. $40 billion changed 07:43 hands. Much of it from people who had 07:46 held it a long time to people who were 07:48 new joining the train. Um, today 30 07:53 because it's the weekend there. The 07:54 volumes are always lower on weekends. 07:55 Today, in the last 24 hours, $30 billion 07:59 of Bitcoin changed hands. So it's 08:02 changing hands from people who have held 08:04 it for a long time mostly to people who 08:06 are buying it for the first time um or 08:09 expanding their purchasing uh for the 08:11 first time. And that is the way money 08:13 always works and that will be the way it 08:15 continues to work until everyone in the 08:17 entire world exclusively uses Bitcoin as 08:20 their only currency. And when that 08:21 happens, the price will have stabilized 08:24 somewhere between $1 million and $21 08:26 million. Uh pretty much every Bitcoiner 08:30 I know in the world thinks Bitcoin goes 08:32 north of $1 million. The most bullish 08:35 projections uh right now are $21 08:38 million. Uh which is Michael Sailor. 08:40 He's generally got the most bullish 08:42 forecasts. So somewhere between more 08:45 than a million and $21 million per coin, 08:49 it will level out. the world will use 08:51 exclusively bitcoin as money and uh the 08:54 value will go up about 3% per year 08:56 because 3% per year is about how much 08:59 humans get better at making stuff. So if 09:01 you have a fixed monetary supply of 21 09:03 million and people keep getting better 09:05 at making stuff eventually 09:08 uh the uh or not eventually but at the 09:10 whole time that is happening the money 09:12 uh increases in purchasing power by 3% 09:15 per year because that you can just buy 09:17 more stuff. there's 3% more stuff you 09:20 can buy with the same money in the 09:21 world. So, that's what's happening. Uh, 09:23 if the price is frustrating to you and 09:25 you think, why are we stuck at $107,000? 09:27 Uh, we're only stuck in the current 09:30 price, the realized capitalization keeps 09:34 climbing as the people who who own those 09:37 21 million Bitcoin keeps changing and 09:41 the new people the old people get off 09:43 the bus with a little bit of their 09:44 stash. new people get on the bus and 09:46 start the journey and eventually we run 09:49 out of Bitcoin that people who have held 09:52 it for a long time want to sell. So in 09:54 my case, all I ever like, you know, all 09:56 I've wanted in the last couple years was 09:57 a generator and to drive a Tesla. So I'm 10:00 good. Like I don't have any major 10:02 purchases on my horizon. Many OG 10:05 Bitcoiners are in the same way. They've 10:07 made the adjustments over the last six 10:09 or seven months to adjust their 10:10 lifestyle to buy whatever they want to 10:12 buy and then they decide they want to 10:14 hold on to the rest. And as soon as 10:15 enough people do that, the price has to 10:17 increase because adoption continues to 10:19 go up. It's just a matter of time. So 10:21 just be patient, load up on whatever 10:23 Bitcoin you want to own before the next 10:24 big upswing. And uh enjoy your journey. 10:28 I'm here to help in any way I can. 10:29 Thanks.