Quincy Diepeveen Profile picture
Jun 23 25 tweets 17 min read

In this little story I summarize how Covid, Supply Chain, Debt, Wages, Inflation, a Eecession, Insolvency and an aging population come together to form a common solution: Crypto Assets

1) ...
So much is happening in the world. War, High #inflation, Covid, #recession, insolvancy, a debt bubble and Supply Chain problems.

All of these causes have a large impact on the world economy and therefore on your portfolio, which makes it important to understand what is going on. Image
The main consequence:

An nation on the verge of collapse and a debt bubble around the world.

As Ray Dalio said

'A nation in its last effort of strength is hugely in debt, there are internal wealth disparities and printing money seems to many to be the solution, but it is not'. Image
This is because economic good times cause people to take loans based on their colateral. If this continues for too long, there will be more money in circulation than there actually is.

At this moment: #debt = 360% of #GDP

The world is in a 3.6x leverage trade Image
In addition, there is inflation. Simply put:

The unlimited possibility of creating more of a #currency if the situation demands it.

A good tool for the Central Banks to counteract a recession, but very easily overused. We clearly saw this in the last 2 years!
But inflation is not just the #CPI number that is presented, it goes much further.

More expensive #Assets , stronger #Dollar , weaker world economy, higher interest rates. Image
Combine that with the fact that #wages have not been rising with asset prices for years, #SupplyChain problems, declining velocity of money due to aging people and you get an Economic tightening.

A huge shock because it is all happening at the same time. Image
This demand destruction causes a decrease in disposable #income, a decrease in risk appetite and the collapse of global markets. First the volatile ones (#Crypto + #equities), later the big ones (RE + #bonds). That is what you see playing out right now. ImageImage
And partly because of this, weak links in the (Crypto) markets become visible.

The risk was always there, however companies in a #BullMarket get away with this. In a #bearmarket it is a different story.

Lesson: Beware of unrealistic, structurally high yields! Image
Back to the #Fed and inflation,

Bringing down inflation is the FEDs main mission before the midterm elections in November. The only option at the moment: QT and hikes.

But, because of the debt bubble (leverage), this can be done up to a certain point until everything collapses.
They have very little room to move. In addition, unemployment will rise while prices will remain as high as ever.

In short, more money is needed! A new #QE period is coming.

Consequence: This leads to a complete devaluation of the currency. Image
The worthlessness of the current monetary system is exactly why we all own Crypto.

A means of payment must be #deflationary.
So if you want to invest you look for an asset that outperforms the creation of current money. I recently wrote a story about 'How to outperform Inflation', see below.

This brings us to the urgency of understanding and investing in Crypto. Currently only #BTC and #ETH .

Time horizon: 5+ years

When to buy: During extreme weakness

And that's where we are now, in extreme weakness. Here are a few examples:
A statistical almost 2SD oversold scenario in a logarithmic trend with a uniquely low #RSI. Image
Price movements show unique opportunities between 200 WMA and 300 WMA Image
The expected growth of the network and the current position ImageImage
Some examples of extreme undervaluation in the #onchain data ImageImage
You get my point, a unique opportunity is up for grabs. However, the world economy is not ready yet and it will probably get worse before it gets better. This will also be accompanied by lower prices.

#DCA into extreme weakness is the right way.
The most #volatile markets (Crypto & Disruptive Tech) are often a forerunner for what is to come. The ones that get punished first will also be the first to make a turnaround when the FED starts being more cautious. It is important that you catch this!
We are still in the middle of #QT, but the sequel is starting to become clearer.

Follow the big #Trends, make sure you have time in the market and don't use #Leverage! ImageImage
Thanks for reading! I would appreciate it if you liked it and would share this further in your network.

If you would like to know more, send me a message and I will send you the Omnium Academy Day 1 - Crypto Fundamentals (2+ hours).

Or check out:

Credits of some images to the creators:


Appreciate your hard work and insights!
Where are we in the current cycle?

The recession for now is still expected to be sharp and severe. The ISM compared to the Global Financial Conditions shows an enormous tightening.

When will the FED pivot? When the ISM drops below 50 Image

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