Thread by @cburniske

The 2020s may be the decade where value goes bust, growth turns into value, and crypto reigns supreme.

That doesn't mean '22 won't be rocky, but in rockiness there's tremendous opportunity.

Some thoughts on how to navigate 🧵

While you could fully allocate your crypto portfolio at current levels, wake up in 5 years and be reasonably happy, in the meantime, you may have to endure a 50% drop (leading to $BTC $22K, $ETH $1,550).

Nonetheless, buying now is better than never buying.

The rally's on, Chris!

It could be, and I could be wrong, but '22 feels like too much of a powderkeg for me to be comfortable saying the bottom's in for crypto.

Rate increases, balance sheet easing, a recession in the US (?), inflation crushing consumer sentiment, war...

Combine the powderkeg of '22 with the cheap-money-casino excesses of '20 and '21, and it feels like this is the year we pay our dues.

In my crypto experience, dues are never fully paid in one selloff. Dues are paid crushingly in waves of selloffs until the soul of the bull is nearly broken.

Furthermore, the private markets of crypto are more developed than the public markets, and so we have less scaled-capital sopping up the asks of bloated private sellers:

https://twitter.com/cburniske/status/1484316908316860418?s=20&t=CTxnK5iiESValGj1xrx4XQ

Greed and fear always take things to the extreme.

So while there is a "mean" that we oscillate around, we always overshoot that mean to the downside in bear markets, and overshoot it to the upside in bulls.

Spastic monkeys.

Will rallies happen throughout?

Of course, this is #crypto.

In 2018's slide, after we first hit $6K we:

-bounced 100%, then fell
-bounced 50%, then fell
-bounced 50% again, then fell
-bounced 25%, before falling...

...from $6K to $3K.

Currently, $BTC is 33% off its lows

So while innovation is on sale, that doesn't mean it can't go lower.

Briefly, on equities, @ARKInvest's Big Ideas '22 is phenomenal and I recommend watching, as it will give innovation enthusiasts hope - this decade will change everything, and you want to be allocated on the right side of change:

Although ARK's strategy is not currently in favor, when things aren't in favor is typically the best range to accumulate them.

One major thing @CathieDWood has taught me is that while people retreat to "value" when they're scared, in the climate of extreme change such a strategy will eventually not work as many value stocks experience a slow death due to their disruption by growth names.

As multiples compress on growth names (which they have been), we may see a world where growth names become the true "value stocks," if you have a long-term view.

Bringing me to $BTC.

BTC is the only thing that could buck the chaos if the world goes to hell, but the market decides 2022 is the year it'll stop treating BTC as a growth-asset & instead as a disaster-hedge.

For this to be the case, we'd have to see Bitcoin dominance moon.

People are understanding that #bitcoin's major proposition is its conservatism; that it will not change in a world that's changing at an accelerating rate.

Conservatism is materially diff from any other #cryptoasset's value add.

(s/o @yassineARK @wintonARK for this framing)

And so what to do?

I never exit the market fully.

Stay focused on growth.

With dry powder be patient, don't spend all at once.

Buy on the bloodiest of days.

Filled orders 2 weeks ago? Great.

Make sure you have more to do the same if synthetic blood runs in the streets again

And for those that reply, "thanks for telling us now."

I've been recommending caution for months now. '21 was a banner year, it was clear almost everyone was money drunk & those situations typically need a reset for great opportunities to arise again:

https://twitter.com/cburniske/status/1383914494225641478?s=20&t=CTxnK5iiESValGj1xrx4XQ

Oops, would add here that 2H 2022 could be great for $ETH if the merge happens on schedule and the market structure of the asset goes through a huge shift from PoW to PoS.

But that leaves 5-months of 1H to get through.