Disclaimer: This post contains thoughts on crypto, a volatile and risky asset class. It is not investment advice, and you should do your own research. All information is for educational purposes only. Please don’t take risks with money you’re not willing to lose.

Welcome to my newsletter, trade journal, research, whatever you wanna call it. I’m setting no specific boundaries or expectations on what this will be other than ‘my occasional thoughts on the crypto market’.

Why Crypto?

Crypto is easily one of the most interesting asset classes we’ve ever seen. Some deem it the future of finance while others quite the opposite, fraudulent and a scam. Public sentiment is often polarizing, but the media heavily focuses on it’s misuses when appropriate (e.g. FTX). Mainstream interest increases when Bitcoin is pumping, yet most never get past buying and selling their crypto in a third-party client like Robinhood. Objectively, crypto is 1) wildly volatile compared to traditional assets and 2) held underwater by the unfortunate bad actors that plague headlines. However, as is the case with all new technologies, educating people beyond the front page is fundamental to furthering adoption.

Crypto is the term that gets thrown around, sometimes Web3, but the entirety of this ‘new internet era’ is architected by blockchains. They’re what make this revolution important and worthwhile.

Consider a traditional social network like Instagram. Participants likely include yourself, your friends, perhaps some celebrities you like. As users, you contribute to the network with interactions. The more network participants, the stronger the platform becomes both in power and influence. Although you bring the value, the network owners retain the permissions (i.e. the rules you must play by).

Blockchains reimagine networks so that there is no need for a centralized, authoritative entity. They replace human based decisions with ones enforced through code. The rules are written in software that can only be manipulated or upgraded if the majority of network participants agree.

The benefits of this new architecture are threefold: it opens access for developers, lowers take rates for creators, and ultimately transfers power away from Big Tech and back into the hands of the users.

When a digital economy is created around these ideas, you get crypto.

Investment Thesis

1. Bitcoin is King

   If you’ve heard of crypto, you’ve heard of Bitcoin. The terms are practically synonymous at this point. Released shortly after the housing crisis of 2008, the Bitcoin Whitepaper set the stage for an entirely reimagined global payments system. Since then, crypto has evolved into a trillion dollar industry with Bitcoin almost always occupying 50% or more of the global market capitalization. Bitcoin is ‘ultrasound’ money, ‘digital gold’ as some call it. It is the scarcest monetary asset in the world with a fixed supply of 21 million. It is permissionless, democratic, and global. As such, Bitcoin represents self-sovereignty, economic freedom, and crypto as a whole.

   Bitcoin is the North Star of the crypto market. As it’s price increases, the rest of the market generally follows. With the recent approval and launch of all proposed ETFs, BTC has established itself king. Since I actively trade, I regularly stack small wins into BTC that I intend to store away for the long term. Consider it a retirement fund.

2. Capital Management

   DeFi ecosystems enable users to not only invest their money, but grow it through protocol participation. Staking, airdrop farming, and providing liquidity are all viable methods of making passive income in crypto. The first two are generally safer, while the ladder includes risk. I like to actively stake coins that I know I’ll be holding for the mid to long term. I stay away from being an LP, but generally spread any excess capital across 3-5 new protocols in order to qualify for their native token launches.

   Efficiently allocating capital from small wins into the majors is fundamental to remaining successful in crypto. Rolling over profits from one equally volatile coin to another will always end in eventual loss. ‘The highest form of wisdom is to know when to play and when to stay away.’ Smaller altcoins are worth trading for greater upside, but profit taking becomes harder when investing begins to feel like gambling. I always reallocate risk-on profits into conviction plays. Furthermore, I aim to allocate only ~5% of my total portfolio to trade microcaps, ~20% for alts, and the remainder is for building spot positions in long-term holds.

3. The Attention Economy

   Crypto is fast-paced and new narratives are rapidly adopted or rejected. This is the nature of all developing, innovative technologies - interest sparks, builders flock, and new products are manifested every day. The dot-com era can teach us a few lessons here. 1) While there will be thousands of startups, many of which seem promising, there will only be a few real winners. 2) Speculative bubbles birth unrealistic valuations for the majority of startups. With regards to trading, these are really two sides of the same coin. If you’re early enough to strong narratives, you’ll likely be in profit early. Being able to identify when attention is shifting away for good as opposed to the short term is therefore extremely valuable.

   Trading the ‘Attention Economy’ is often where crypto begins to feel like a casino. As such, it’s risky, but highly profitable if played correctly. I like to assume most narratives will die out, but closely monitor sentiment through X. Taking profits early as to comfortably ride positions is key. I like to build conviction from a risk-free perspective before rotating short term plays into my ‘winners’.

Current Portfolio

By the grace of god, I found an early winner in WIF and have taken comfortable profits while still maintaining a position in the top 100 holders. As such, my current portfolio allocations are extremely degenerate and will likely change as this cycle unravels. Regardless:

Watching: TAO, JUP

Staking: SOL, TIA

Farming: Blur, Blast, Ethena, Tensor, MarginFi, Kamino, Parcl

NFTs: 1 Pudgy, 1 Lil Pudgy, 1 Milady, 1 Mad Lad, 1 Tensorian, 1 Clayno, 3 Quekz

Narratives: AI

If you've made it this far, thanks for reading. My future posts will likely be market updates, new narratives I’m watching, trade updates, etc. Some of my subscribers are new to crypto while others trade daily, so I will do my best to cater to both. Until next time.