#981 Will Clemente On If Bitcoin Just Hit The Bottom

Will Clemente is the Lead Insights Analyst at Blockware. He has quickly become one of my favorite writers on all things Bitcoin, including deep dives on various on-chain analytics. This week, my brothers Joe and John filled in for me and spoke to Will for our weekly Bitcoin On-Chain Analytics. In this conversation, they discuss the current state of Bitcoin, if we've hit the bottom of the market low, and what needs to happen for Bitcoin to bounce back. Will joins us every Friday on "The Best Business Show." To see the video with the corresponding charts that Will references throughout the interview, go to the Anthony Pompliano YouTube Channel. ======================= Today’s episode is brought to you by Coinbase Wallet, your key to the world of crypto. Crypto wasn’t made to just buy, sell, and hodl. With Coinbase Wallet, you can do so much more: Collect more NFTs, earn more with DeFi, and trade more than 4,000 tokens. Whether you’re looking to play, stake, spend, or just explore a trending new protocol — Coinbase Wallet is your key to more. Long-time HODLers already know that wallets are a must-have if you want complete control of your crypto. That’s why Coinbase Wallet makes self-custody simple, while providing the safety and security of the most trusted name in crypto. Visit http://coinbase.com/wallet to learn more. ======================= If you’re a regular listener of the podcast, I would bet that two things are true: First: You’re passionate about Web3 and protecting your personal data And two: that you’re a human. If I’m right, then congratulations! You’re entitled to all the benefits of the decentralized web. But there’s a catch: As Web3-enabled tech — like NFTs, smart contracts, and DAOs — drive more elements of our “real world” lives online, proving that you’re a person – without surrendering personal data – becomes exponentially more valuable. And exponentially more difficult. This is why Unstoppable Domains launched Humanity Check. Humanity Check proves that you’re, well, you – without revealing personal data. No matter where you go on the web, you’ll have total control over which apps you want to share data with…and which ones you don’t. Prefer to be completely clouded in mystique? No worries - Humanity Check is 100% opt in. If you want to feel alive, or at least prove you are, head to http://UnstoppableDomains.com and get your NFT domain with Humanity Check. ======================= Crypto is all about giving the power back to the people and our sponsor, Pipe, is doing that in a big way. Pipe is the world’s first trading platform that allows you to trade recurring revenue streams for up-front capital. And with Pipe’s new API, companies with recurring revenue can build seamless, embedded financing options into their platforms. One of the most interesting uses for Pipe’s new API right now is Compass Mining’s “Mine Now, Pay Later” which powers payment plans on bitcoin mining hardware so more miners can start or scale with a smaller up-front investment. Whether you’re looking for mining hardware or scaling any business with recurring revenue, check out Pipe to access growth capital with: No loans. No dilution. No restrictive covenants or warrants. Just growth on your terms And right now, Pomp Podcast listeners can access tens of thousands of dollars even millions fee-free for 12 months. Whether you are a bitcoin mining company looking to enable financing for your customers or a SaaS, DTC, or any business that has recurring revenue, sign up at http://pipe.com/pomp to start trading today.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Will Clemente is the Lead Insights Analyst at Blockware. In this conversation, we talk about Bitcoin, the market structure, on-chain analytics, and where we go from here. I really enjoyed this weekly conversation with Will, as always, and I hope you do as well. Before we get into this episode, I want to quickly talk about our sponsors. Today's episode is brought to you by Coinbase Wallet, your key to the world of crypto. Crypto wasn't made to just buy, sell, and hold. With Coinbase Wallet, you can do so much more. Collect more NFTs, earn more with DeFi, and trade more than 4,000 tokens. Whether you're looking

• 0:46Anthony Pompliano?

  to play, stake, spend, or just explore a trending new protocol, Coinbase Wallet is your key to more. Longtime holders already know that wallets are a must-have if you want complete control of your crypto. That's why Coinbase Wallet makes self-custody simple while providing the safety and security of the most trusted name in crypto. Visit coinbase.com/wallet to learn more. Again, that's coinbase.com/wallet and learn more today. Today's episode is brought to you by Unstoppable Domains. If you're a regular listener of this podcast, I'd bet that the two things are true. First, you're passionate about Web 3 and protecting your personal data, and two, you're a human being. If I'm right, then congratulations, you're entitled to all the benefits of the decentralized web. But here's

• 1:29Anthony Pompliano?

  the catch. As Web 3-enabled technology like NFTs, smart contracts, and DAOs dive more elements of our real-world lives online, proving that you're a person without surrendering your personal data becomes exponentially more valuable and exponentially more difficult at the same time. This is why Unstoppable Domains launched Humanity Check. Humanity Check proves that you're, well, you, without revealing any of your personal data. No matter where you go on the web, you'll have total control over which apps you want to share your data with and which ones you don't. Prefer to be completely clouded and mystique? No worries, Humanity Check is 100% opt-in. If you want to feel alive, or at least prove you are, head to unstoppabledomains.com today.

• 2:10Anthony Pompliano?

  And get your NFT domain with Humanity Check. Again, head on over to unstoppabledomains.com and get your NFT domain with Humanity Check today. Today's episode is brought to you by Pipe. Crypto is all about giving the power back to the people, and our sponsor Pipe is doing that in a big way. Pipe is the world's first trading platform that allows you to trade recurring revenue streams for upfront capital. And with Pipe's new API, companies with recurring revenue can build seamless, embedded financing options into their platforms. One of the most interesting uses for Pipe's new API right now is Compass Minings, mine now, pay later, which powers payment plans on Bitcoin mining hardware, so more miners can start or scale with a smaller upfront investment.

• 2:53Anthony Pompliano?

  Whether you're looking for mining hardware or scaling any business with recurring revenue, check out Pipe to access growth capital with no loans, no dilution, no restrictive covenants or warrants, just growth on your terms. And right now, Pomp Podcast listeners can access tens of thousands of dollars, even millions, fee-free for 12 months. Whether you are a Bitcoin mining company looking to enable financing for your customers, or a SaaS, DTC, or any business that has recurring revenue, sign up at pipe.com/pomp. Again, pipe.com/pomp to start trading today.

• 3:29Speaker 01

  Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

• 3:53Anthony Pompliano?

  We have the wizard, Mr. Will Clemente. Will, how we doing?

• 3:58Speaker 02

  What's up, Jets? It's been a minute.

• 4:00Anthony Pompliano?

  It has been a minute. How you doing, man?

• 4:02Speaker 02

  Chilling, chilling.

• 4:04Anthony Pompliano?

  What's going on with Bitcoin? What is your general kind of overview 30,000 foot, what you're seeing, and then we'll get into some of the charts?

• 4:10Speaker 02

  Yeah, I mean, look, I think... In these these kind of current conditions, you shouldn't be trading lower timeframes unless you have some like material edge and like order flow or whatever it may be that you feel like you have a short term edge in. But you know, I think like trading drawing lines on chart, I don't think it's very conducive in this environment when everything is really driven by macro and you have the Fed come out, say a couple of words and then all the lines you're drawing on a chart are just completely blown out. So I think in this environment, you should be more focused on the high timeframe than ever. And you know, again, unless you have some type of material edge, probably just be focusing on building long term positions and things you have strong conviction in.

• 4:52Speaker 03

  Gotcha. So let's start with some of the charts. I'd love to start with the one that talks about the price drawdown from the all time high. What are you seeing here?

• 5:00Speaker 02

  Sure. Yeah, I mean, this is a pretty straightforward chart. It's just telling you the amount of, you know, price drawdown from the previous all time high. As you can see, we're currently 57% down from Bitcoin's all time high in November of last year. Historically, we've seen Bitcoin get as low as 80% down from its all time highs. We saw that in 2012 when Bitcoin drew down 90%, which is pretty gnarly. I mean, I can't imagine, you know, owning owning Bitcoin back then when you have no price history whatsoever, saying that, you know, it's recovered. That was after the first major run up in price. So, you know, those people had incredible conviction that held down 90% or were adding there. You had a drawdown of over 80% in 2015 as well as 2018. And then

• 5:43Speaker 02

  the other largest one was in March of 2020 when it drew down almost 80% from from its previous high. So currently, you know, we're down pretty substantially, but in Bitcoin terms, you know, we, you know, by Bitcoin standard, I should say, you know, we could potentially see, you know, much lower drawdowns. But I guess the caveat to that would be We didn't reach that level of explosive upward moves in price that a lot of people, including myself at the time, were anticipating heading into, you know, the end of 2021. And we kind of got that cap off and rounded top in price that, you know, didn't translate to the historical kind of parabolic blow off top that we've seen in previous market cycles.

• 6:27Speaker 02

  So I think there's potentially an argument to be made to say, well, because the top wasn't as explosive, perhaps we don't have that, you know, extreme 80% drawdown. If that were to take place as it has in the previous three, you know, major cyclical drawdowns, that would put Bitcoin at like 12 to 14K if we went down 80, 85% peak to trough. So, I don't know, I personally will, we'll get to that in a moment as to where I'm seeing value. But I think there's a somewhat of a strong case to be made that because we didn't see that parabolic price action to the upside, perhaps we don't see as much of a reflexive, you know, capitulation bottom to the downside.

• 7:05Speaker 03

  Yeah, that makes sense and I'd love to talk more about that through the next few charts. But let's move on to the monthly returns chart that you sent over. What are you looking at here?

• 7:14Speaker 02

  Yeah, it's just kind of just going off the last one of showing you peak to trough drawdowns. This is just showing you the month, month over month change in price. So as you can see, this is one of the worst monthly performances of BTC in its history, only dwarfed by a couple of those times that we discussed a minute ago, including, you know, 2018, March 2020, summer of last year, some of the obvious ones you'd expect.

• 7:39Speaker 03

  Gotcha. And then when we move on to the following one, which is looking at, I can't necessarily even read this at the top left, but it looks like Bitcoin over US dollar, right?

• 7:50Speaker 02

  Yeah.

• 7:51Speaker 03

  Yeah. What are you looking at here?

• 7:52Speaker 02

  Yeah, I was just, just showing like short term, we're just literally ranging going sideways. So, you know, nothing too exciting. I mean, you have like some short term traders that will look to just, you know, buy the bottom of the range, short the top of the range. I mean, maybe that's the type of, you know, trading that you find conducive for like scalper type of entities, but that's not the type of trading again that I'm looking to do in this type of environment. Again, I think, especially in the newsletter, we've never really focused on that kind of short term, you know, trading mindset. We've always tried to. We we view it as, you know, trying to help people strategically allocate to BTC rather than, you know, trade it short term. But, you know, I guess if, you know, if that's the type of trading you're interested in, you could play the range. But uh, it was just really just putting

• 8:36Speaker 02

  the chart in here just to show that we've really just been sideways for two weeks straight.

• 8:40Speaker 03

  Well, I think we have a good meme here, too. Yeah, I was gonna say, I think we have a good uh, a good meme to prove your point uh, around this. You're such a dumb animal. Aren't you directly trading a range?

• 8:56Speaker 03

  Yeah, that's an amazing one. Did you make that?

• 8:58Speaker 02

  No, no, no.

• 8:59Speaker 03

  Well, I would send that to Elon. I got a feeling that might be posted.

• 9:04Speaker 03

  Yeah, that's a good one.

• 9:05Speaker 02

  Pretty solid one.

• 9:06Speaker 03

  Yeah, I like that one. Alright, let's move on to the next chart.

• 9:09Speaker 02

  I will say, oh, before, before, um, I like this, this uh, this one meme I saw it was hard times, hard times create strong memes, strong memes create good times. You know, like the fourth turning, but with memes instead of, instead of men. I think it's true. We're seeing some, some pretty solid memes come out of this bear market.

• 9:28Speaker 03

  Yeah, people have more time. They're not just posting uh, price updates all the time. They, they have the ability to uh, go make more memes, which is good. Alright, so let's, let's zoom out and look at Bitcoin uh, over a longer timeframe now, which is this next chart that you have. Uh, talk me through why you think it's important now to zoom out and look at some of this stuff from this angle.

• 9:46Speaker 02

  Yeah, I think, you know, I, I've been in this market for two years now. As of the next, you know, in a week, it'll have been uh, two years of my anniversary or whatever of getting into BTC. And I think like, my, my mental framework of how I've approached the market has evolved a lot in that time. And I think one thing that I've learned from just a high level is, you know, not over complicating things. And I think it's really boiled down to me to value and momentum. And this is like a mental framework that my buddy Avi from Golden Tree introduced to me uh, about five or six months back. And it's, it's really kind of, you know, set, set home with the way I've approached the market now. Um, and I think like, you know, the, from a high timeframe

• 10:29Speaker 02

  perspective, you can set, you know, two thresholds for yourself, one being momentum and one being Value. And so that's kind of how I I outlined the the remainder of the newsletter this week. Uh, so we'll start with the momentum side. Uh, obviously, we're well below a lot of these momentum thresholds, but just saying this is where I'd be looking to get active as a momentum market participant in, you know, theoretically, if we were to get up to some of these areas. So first, we're starting with uh, the hundred eighty week exponential whole moving average. So this is a moving average that essentially just has more weighing to recent price action. Uh, whenever the whenever the oscillator is increasing, so whenever the moving average is increasing, it's green. And whenever it's decreasing, it turns red.

• 11:12Speaker 02

  Uh, it's pretty, pretty simple. Uh, and so it's basically a good, high timeframe, kind of uh, momentum or or trend following indicator to to look at. Uh, and so as you could see, you know, whenever this flips red, it's not good. You'll see before uh, twenty eighteen. And I posted this a few weeks ago when we were at like thirty six K, the first week that we flipped red. I was like, yeah, this is not great from a momentum perspective. Uh, we're, you know, flipping bearishly uh, in that regard. And since then, we've, we've seen some continued downside. Uh, and so again, that that sits around uh, like around forty seven K. That's kind of the, the area of confluence I've highlighted across all these things. We'll go through a few more uh, from the momentum side, but that kind of sits around forty seven K,

• 11:56Speaker 02

  where I'd be looking at theoretically get active as a, as a momentum market participant, but still, you know, sitting well below that.

• 12:02Speaker 03

  Gotcha. And is there any indication around how long uh, those time periods last historically?

• 12:08Speaker 02

  Uh, I mean, I, I, I don't think like, you know, we have like three, three time samples from, from going back in the rest of this chart. So I think it's difficult to like, look at three sample size and then make any conclusions going off of that. So I would just say, instead of looking at time, just look at the action of what's being, you know, told by the chart.

• 12:28Speaker 03

  That's why we bring you on because you're you're smart. All right, let's talk about the the chart here that has the 2022 yearly open marked on it.

• 12:35Speaker 02

  Yeah, again, this is just, you know, somewhat of a psychological level. People look at yearly open. The 2022 yearly open is at 46,200. We kind of deviated above that and got, you know, faced a lot of resistance when we had that push up to around 47K. In April, there was also a confluence of rejection from the previous chart we looked at, where we had a failed underside retested that as well. And the next chart we'll look at as well, confluence there as well. You know, so again, confluence is key. And so, you know, back in April, we had, you know, several failed underside retests of all of these things I'm looking at as momentum thresholds.

• 13:15Speaker 02

  And to me, that was quite bearish at the time because showing you the market is failing to regain any type of momentum. And it just looks like a bear market retest in that regard. Short-term holder cost basis, something we've talked about a while on the show. Dylan's talked about it a bit when he's come on, essentially the average cost basis of all the entities on chain that have been in the market for less than 155 days. That's come down a bit as you've seen short-term holders capitulate, meaning that their cost basis has come down. And as well as some people averaged down as well. Let's brought that down to about $45,038 if you want to be exact.

• 13:52Speaker 03

  Gotcha. And then we have, what's the next one, realized price? If you want to talk through realized price.

• 13:59Speaker 02

  Sure. So, yeah, so that was that was from a momentum standpoint, see that it's about 47K. When we move on now to the value framework, talking about, you know, like extreme value, like cyclical bottom type of areas for BTC. We currently see that as about 22 to 24K. Again, not necessarily saying that that is most definitely going to happen. Just saying that if, you know, you got to speak in an if then, if then format, right? So if we got to that area, I would be looking at, you know, that's where I'd be, you know, betting the farm and, you know, deploying all of my dry powder. Just because it's so plus EV to deploy historically at some of these levels.

• 14:38Speaker 02

  About to talk about. So yeah, first we'll start with realized price. This currently sits at 24,000 USD. That's essentially the, you know, we talk about short term holder cost basis, but realized price is just the absolute aggregated cost basis of all the UTXOs on chain. And so whenever, whenever price goes below that historically, that served as an amazing buy opportunity. For people with kind of that multi-year time horizon. And, and by definition, whenever price is below realized price, what that's telling you is that, you know, all in aggregate market participants are underwater, right? Because by definition, you're below their cost basis. And so that's where you can start to see some major capitulation, et cetera. Uh, that's kind of where you want to be allocating historically.

• 15:22Speaker 03

  Gotcha. And then I know, uh, our friend Z score is back. So talk to me through what you're seeing here.

• 15:28Speaker 02

  Yeah, I love this chart. I think it's, um, one of the, one of the best ones to be looking at for, for what we're talking about here from, from a value perspective. So this is comparing, it's another way to look at the chart we just looked at, but instead you're just taking a ratio of price to realized price. So whenever, again, whenever market price gets below realized price, by definition, uh, market participants are underwater in aggregate. And so that's when you get into that green zone at the bottom. So if Bitcoin's price was to go below that realized price around 24,000, then that oscillator would move down into that green zone. The green zone historically is marked basically generational buy opportunities for BTC.

• 16:06Speaker 02

  So again, that's an area where if we entered that green zone, that's for, for me personally, of course, not financial advice, uh, where I'd be just looking to deploy all of the remaining cash that I'm sitting on. In case, you know, we, you know, in case we, we do enter that threshold.

• 16:21Speaker 03

  And you said what? That's at 24,000?

• 16:24Speaker 02

  Yep, uh, at 24,000. And so, you know, that, that would be to, that would be to start going into that green zone. You know, if we started going below, essentially I have bids ladder down from about 24 to 22K. And the, the 22K comes from the next chart we're looking at, uh, I'm sorry, the, in a few charts, in a few charts we're looking at.

• 16:43Speaker 03

  We'll get there.

• 16:44Speaker 02

  The order, but, um, yeah, down from, down from realized price essentially to the two. 200 week moving average. The 200 week, the 200 week moving average has basically caught every cyclical bottom, basically to the tick. Um, that's a pretty widely known moving average that um is used in almost all markets, but for BTC is has been a great uh signal. And so I have I have my bid slatter down from that realized price down to that 200 uh week moving average.

• 17:12Speaker 03

  Interesting. Okay, cool. Uh, and then talk me through the multiple here, the the Meyer multiple that you're uh charting out.

• 17:17Speaker 02

  Sure. Uh, so this is looking at the market price compared to the 200 day moving average. Um, not to be confused with the 200 week moving average that we'll we'll get to in a moment. Uh, the 200 day moving average, I think sits at like 44K or 45K. Uh, I looked at it about an hour ago. Um, a- and so like, as you can see, we're we're very close to where historically this has marked these generational buy opportunities in, you know, 2014, 2015, uh, 2018, March of 2020 and and summer of last year. Um, not quite at those like absolute low levels of those readings, but generally speaking for, you know, uh, people who kind of average into the asset class,

• 17:57Speaker 02

  whenever we're below that that green threshold at the bottom, that's a great time to to really increase your DCA.

• 18:03Speaker 03

  Gotcha. Uh, and then you're so good that you're now taking the temperature of the price. Uh, so talk us through the price temperature chart that you got here.

• 18:11Speaker 02

  Sure. So this is created by my buddy, uh, dilution proof, who's another uh Bitcoin analyst from that I met through Twitter. Uh, he created this metric, I want to say like five or six months ago, and essentially it just looks at the amount of standard deviations from the four-year trend of price. Uh, four-year trend was was based on having. And so as you can see, um, each of these price levels is is, you know, caught is the these kind of like key pivot points for BTC pretty well, but especially that lower bound. Uh, and so that lower bound currently sits at about 21K. Uh, as you can see, that that caught the bottom in 2015, uh, 2018, 2020. Uh, and we're not quite there, but we're we're getting pretty close. And again, that's

• 18:55Speaker 02

  that's kind of on the the bottom range of where I have my my bid slatter down personally.

• 19:00Speaker 03

  Gotcha. And then I think these next two or three charts are the ones that you wanted to speak more about. Let's start with the, just the Bitcoin US dollar one that you have here, tracking over from July 2016.

• 19:12Speaker 02

  Yeah, so we talked about it a second ago, the 200-week moving average. So this is that chart. As you can see historically, you know, whenever we get near this 200-week moving average, it's a great buy opportunity. It sits at about $21,000 right now. Of course, we're, you know, a bit away from that, getting pretty close. But again, that's kind of the bottom range of where I'd be looking to average my bids down to. And then as well, I don't want to get, you know, too repetitive, but also the next chart sits around 20,400, very similar to that 200-week moving average. Except this is the 180-month exponential moving average. So we looked at the 180-weekly exponential moving average as a momentum threshold.

• 19:58Speaker 02

  The monthly version I'm looking at as a value area. So this sits again at 20,400. The interesting thing to note about this, aside from the fact that very similar to the 200-week moving average, it's caught these kind of like cyclical bottoms. It stayed green the entirety of Bitcoin's history. So again, remember what I, you know, said at the beginning, the exponential moving average, when it's increasing, it stays green. When it's declining, it turns red. So this is a good visual to just show you that, you know, the monthly momentum of BTC is up only over time. Because this has stayed green throughout the entirety of Bitcoin's history. So, you know, this is like one of those type of, you know,

• 20:40Speaker 02

  indicators you could look at whenever you're perhaps losing that, you know, long-term conviction to show you that, you know, over, over the long-term BTC is up only.

• 20:48Speaker 03

  I like that. I like that. Okay, last chart is the geographic premiums. What are you seeing here?

• 20:55Speaker 02

  Yeah, so I was gonna throw some like some other like various charts in here, but I hit the like the limit on the amount of images you could put in the newsletter this week. So decided this was like the most interesting of those. This is looking at the all the trading hours based on like the geographic areas of what those those hours are, you know, essentially the the trading hours for each of those areas. So in particular, looking at Asia, Europe and the United States. And so this in particular is comparing the Asian trading hours to the European and United States trading hours. And so as you can see, over the last two years, Asia's really kind of dominated this market. A lot of people kind of associate the Asians with, you know, being kind of like the OGs of the crypto market.

• 21:41Speaker 02

  As you can see, they they bought the the COVID lows. They sold down increasingly aggressively into the top of 2021. They bought back all the all the puke from the United States and and Europe at the bottom in summer of last year. They sold the initial pump off those lows, bought back the the the drawdown to 40K before that final push up to the all time highs in November of last year. They didn't quite sell the exact top, but they sold extremely aggressively, the most aggressively they ever have in November to December of of last year. They bought back a bit at the lows in January and then sold down into the range highs leading up to this recent move down we've seen below 30K.

• 22:24Speaker 02

  And since then, we've seen that premium tick up quite a bit, which is what's been catching my eye because this is now the second highest that the Asian premium to other geographic trading hours has gotten since summer of last year. So it's something to to keep an eye on, you know, of course, you know, no one, you know, no, no group or you know, individual is is 100% accurate, but you know, given kind of the track record of how we've seen Asia perform relative to Europe and in the United States, based on these trading hour premiums. This is this is pretty interesting to me, especially if we start to get up to those levels of premium that we saw in summer of last year.

• 23:03Speaker 03

  Gotcha. So before I let you go, to me, it sounds, if I can just simplify all these amazing charts you put down, it sounds like we're trading sideways for a little bit of a period of time now. We're obviously declined tremendously from the, from the top, but not nearly the 80% that we had seen in previous markets. And based on all of the charts and all the things that you're seeing from the 200-week moving average, 200-day moving average, whatever it is, if it gets to 22, 24 kind of range, that's when you, as a long-term holder and a long-term buyer, someone that's dollar-cost averaging to the asset, that's when you would get more aggressive. Is that kind of a fair way to look at this?

• 23:38Speaker 02

  Yeah, exactly. And like, you know, I've been saying for a while that we've been in kind of the lower 10 to 25th percentile on a lot of these indicators and that therefore it's a good time to average into BTC. But what I'm talking about here today is like where you'd want to deploy your dry powder for like your grandkids, grandkids, you know what I mean? And that's where, you know, all of the 20, 25% cash that I'm currently sitting on, you know, I would be deploying. And, you know, I think it, you know, some people say, well, you know, Bitcoin's never faced a, you know,

• 24:13Speaker 02

  macro environment of monetary tightening or whatever. I think, you know, at the end of the day, you have to just, you know, make plus EV decisions. And historically, these have been great areas to allocate historically. So, you know, that's, that's where I'm placing, that's where I'm going to be placing my bets and we'll see how it plays out. But that's kind of my view and I think, you know, macro's been in the driver's seat now for several months. Just, you know, the liquidity tide's been pulling back and with that, I mean Bitcoin's been just trading tick for tick with the NASDAQ. We've seen Bitcoin's correlation to the NASDAQ hit an all-time high last week on the three-day correlation, which, you know, you don't love to see, right? Because I think we all, we all would love to see BTC be that uncorrelated asset we all believe it is.

• 24:59Speaker 02

  I think that's coming. I just think, you know, at the end of the day, you have, you have kind of these short-term correlation periods, which are, you know, somewhat spurious, maybe for a few months. But then, you know, over the long-term, you have this adoption curve that, you know, lasts for the last, you know, 10, 10 years or so and is going to continue out into the future. And that almost acts as a floor that continues to push up and up and up over time. And I think what's going to happen over the next, you know, call it... Six to twelve months is for BTC to find a bottom. You know, in a disgusting macro environment. You know, you're gonna have like two types of buyers.

• 25:40Speaker 02

  Either A, you're gonna have people who are, you know, taking like a contrary bet that, you know, they think that the worst. You know, markets are forward looking, right? So you're gonna have people that think the worst of the monetary tightening is been, you know, priced in or whatever. But then you also just have a group of like hardcore convicted crypto natives, right? And they're buying, you know, no matter what the current macro environment is because they believe in the asset class. And I think you're, you know, this bear market, you're seeing that supply transfer to those individuals. And that's what allows BTC to have these aggressive run ups is these aggressive drawdowns. As silly as it sounds. Um, because what happens is whenever BTC draws down substantially, you get rid of all the tourists.

• 26:23Speaker 02

  And the only people that are buying when BTC is down sixty to eighty percent are people who have extreme, extreme conviction. Uh, and so when you have that supply concentration to those individuals, people buying BTC down eighty percent or down sixty percent right now. Uh, you know, those people aren't likely looking for a ten percent return on BTC. And so, you know, they're looking for several multiples to the upside. And that's what really allows that that supply concentration uh for BTC to run back to the upside. And I mean, that's, you know, we're seeing that in certain measures, but um, you know, just from not even looking at the data. It's just like logically like how Bitcoin has been able to have these big exponential runs.

• 27:02Speaker 02

  Um, and so, yeah, I would say, um, you know, I wouldn't, I wouldn't place, you know, your entire thesis on Bitcoin. If you have conviction on what the current environment is macro wise. You know, I think you, you look at some of these things and you just say, you know, historically, these have been plus EV areas to allocate. Uh, and you know, it's almost like, you know, okay, I'm either gonna buy here or, you know, things are gonna be different than they ever have. And I think it's dangerous to say like, this time is ever different necessarily. Cause like the human psychology is always gonna stay the same. Like at the bottom, it's always going to seem like it's never going to stop going down. At the top, it's always going to seem like it's never going to stop going up.

• 27:46Speaker 02

  So that's, that's a little, I guess, rambling to, to wrap it up. Obviously, obviously macro is important, but just saying, I think, you know, it's at some point, you have to just look at these areas which have historically been super attractive and kind of put your balls on the chop block.

• 28:02Speaker 03

  I like it. I like it. Uh, that was very impressive. Thank you for helping us out today with the charts. Uh, I enjoy your email as always. Where can other people go sign up for your email? Uh, and follow you on Twitter to make sure that they're getting this stuff immediately.

• 28:15Speaker 02

  Sure. No, thanks for having me on. I know we ran a little over on time when you guys usually end because I was running last minute with the newsletter. So appreciate you accommodating letting me on. Um, if you're interested in the newsletter, you could go to block or intelligence.com. Uh, my Twitter, I guess, is up on the screen. Uh, and yeah, I mean, looking forward to, to keep coming back on. I know I haven't been on in a few weeks. I was messing around. I was at the beach twice and then I was back home. So I'm glad I'm, I'm glad I'm finally back on with you guys and, uh, looking forward to seeing you again next week.

• 28:46Speaker 03

  We're happy to have you back, uh, Will. I hope, uh, everything is good with you. I hope you're having a great time with your, uh, your dog. I hope you enjoy the nice, long weekend. You have any plans or no?

• 28:55Speaker 02

  No, man, I'm, I'll be watching the Rangers game. Um, Memorial Day, probably just kicking back. Uh, I think I'm going to head home for Memorial Day to see the family. So should be fun, but nothing, nothing crazy, man, but let's go Rangers.

• 29:07Speaker 03

  Are any of your buddies, uh, making fun of you now that you're all in on Bitcoin and Bitcoin's price is dropping? Or, or they all learned their lesson when it ran up last year?

• 29:15Speaker 02

  Um, no, because I think my friends know like my conviction is so strong that I don't really care. Like, I think, I think they know if it went to $10, I would like be the buyer of Last Resort or whatever.

• 29:30Speaker 02

  You know, I think like, uh, They're never, I've had like a couple of people be like, oh, are you okay? Oh, hey, man, I saw the markets like I saw the market chew down a lot. Are you all right? I'm like, dude.

• 29:42Speaker 03

  I'm still paying around. Don't worry.

• 29:45Speaker 03

  Yeah, that's a.

• 29:47Speaker 02

  It's like, come on, man. This is where you want to be buying. You know, you start, you start getting all your normie friends asking you like, dude, is this thing, is this thing dead? Like, I think I'm gonna sell out of all my crypto. It's like, okay, well, you know, this is, this is, these are not things that you see at the top. That's for sure.

• 30:01Speaker 03

  Yeah, I was gonna say, it's probably even a better time to convince some of them to join you because of your conviction in, in, in price drawdowns like this, right? They see that you're not messing around and that this isn't just fun and games or a job. So.

• 30:14Speaker 02

  It's the inverse of when people are telling you, you know, last year to buy Safe Moon or whatever bullshit that, you know, their flavor of the month.

• 30:24Speaker 03

  It's when your barber tells you XRP is going to $5.

• 30:27Speaker 02

  Yeah, it's like, uh oh. These are not things you see at the bottom.

• 30:31Speaker 03

  Yeah, exactly, exactly. All right, man. Well, have a good weekend. Thanks for coming on again and we'll talk to you next week.

• 30:37Speaker 02

  For sure. Take it easy, guys. See you around.

• 30:39Speaker 03

  See you.

• 30:39Speaker 02

  Peace.

• 30:40Anthony Pompliano?

  Thanks so much for listening to today's episode. I really hope you guys enjoyed this one. Make sure you subscribed on Apple, Spotify, or your favorite podcast player. And if you're looking to try to transition to get a new job in the Bitcoin or crypto industry, we've got you covered. Head over to pompscryptocourse.com. We've developed a curriculum with the top teams across the industry. It's a three-week intensive training program with over 50 events packed into that three-week time period. Go to pompscryptocourse.com to learn more and I'll meet you guys for the next episode.