What are these characteristics? There are things like visibility, portability, transferability – how easy it is to transfer – and most importantly, scarcity. Along with this one critical feature that all money needs, bitcoin is the best form of money that has ever existed. This has not changed. This fundamental aspect of what makes bitcoin good – or I think the best – money has not changed. It’s just the market going through these cycles of people trying to understand what it is and people getting overexcited and then losing hope.
Each of these cycles is defined by a group of people. In the first cycle, the group of people was very small. There were only people who could understand bitcoin: cypherpunks, computer scientists and maybe some hardcore libertarians. It was a very small circle of people, but every cycle that circle gets bigger and bigger, and so we’ve gone through a cycle where we actually brought in a lot of retail investors, but there are a lot more retail investors. There are many more institutions. There are many more nation states out there and many of them got a taste of bitcoin. They might have given up and said, “Oh, this thing has failed,” but maybe they bought a little. Maybe they bought, say, 1% of their portfolio, or maybe even $100, and they gave up bitcoin, but these people are prepared to come back in the next cycle.
I’ll give you one example of this: Stanley Druckenmiller is a very famous macro investor billionaire. [He’s] very successful over a very long period, investing in macro games. He owned bitcoin during this last cycle and just recently I heard him say he doesn’t own any bitcoin. Now it sounds bad: He has given up bitcoin. He has been mentally trapped. He’s always going to be paying attention to the price of bitcoin, and when bitcoin starts – as it always does in every cycle – slowly but surely coming back, he’s going to be paying attention. He’ll say, “Oh, it hasn’t died. It’s been stuck around $20,000” or whatever it is, wherever it finds the plateau. “It’s been stuck around that level for a long time. It hasn’t gone away, and it looks like it’s crawling up.” Now it’s $23,000, $24,000, $25,000, maybe $30,000. People like him will come back because they’ve been exposed to bitcoin, they’ve been mentally trapped. They’ve had enough touchpoints where they’ve heard enough about it, or they’ve invested a little and they will come back.
This is the same thing that happens every cycle. The same thing happened back in 2017, where a bunch of people got burned when they bought $19,000 or $20,000 worth of bitcoin and it dropped to $3,000, and they’re like, “Oh. Why did I do that? It was a terrible investment,” but then those in the current cycle, which is finished, and they came back because they noticed bitcoin. They knew about it; they knew how to invest. They were ready to put in more capital. So every cycle, the [amount of] people who are ready to enter are much larger. The number of people ready to come in the next cycle, especially institutions and high net worth individuals, is gigantic. Some of the things we saw, I think people got way too excited. They saw Michael Saylor come in, they saw El Salvador and they thought this cycle is the cycle when we’re going to have every single high net worth individual, every corporation, every nation state; they’re all going to pile in.
I actually think what you got was just a taste of what we’ll see in the next cycle. I was really surprised to see El Salvador come in. I didn’t think a nation-state would do what El Salvador did for a few cycles into the future, so what happened is what I expected, which is that most nation-states will stand back and do nothing, but now I think many more of them will be primed in the coming cycles to come in and do what El Salvador did. So I think there are many reasons to be bullish on bitcoin. None of the fundamentals have changed, none of the characteristics that make bitcoin superior to all its competitors, none of it has changed.
The number of people who have been exposed to Bitcoin is much, much larger. What you have, if you’ve been around for a while, or you listen to people who have been around for a while, is an incredible opportunity. The best time – if you’re one of those people around in a bear market – to invest is right now. The best time to gain exposure to learn more about Bitcoin, to do something for Bitcoin, to go and build a business in the Bitcoin space is right now. The people who are around now who are either building businesses, investing or learning about Bitcoin, they are the ones who are going to be the most successful in the coming cycle.
What you don’t want to be and what always disappoints me is the people, friends and family I talk to, they only get interested right at the end of the cycle. It is the same every single cycle; I’ve been through four of them now. People come to me at the end of the cycle and they say, “Tell me about Bitcoin. How do I invest in bitcoin?”
I’m like, “I’m really glad you’re interested in Bitcoin. Just be careful because Bitcoin is cyclical; it goes through cycles. Learn about investing in bitcoin; put a small percentage of your portfolio there.” I usually think about it since they are not ready. They come back the next cycle, and they’re going to be a little burned. I don’t want them to get too burnt so they never come back. But if you’re around now, if you’re listening, there’s a big opportunity. They don’t come that often; it is once every four years.
Eventually these cycles will stop when Bitcoin comes to complete, full adoption. And I think we’re maybe only three or four cycles away from that. So I’m very excited. I think this is the best time to be interested in Bitcoin. None of the fundamentals have changed, so get out there and learn about it.
Get out there and invest. Get out there and build it. Now is the time.
