Thread by @liamherbst_

How GCR made $50,000,000 betting against crypto cults ↓

Throwback to Jan 2021...

r/wallstreetbets was determined to make DOGE moon.

Elon's tweets were causing the price to pump 50%+

DOGE was up from $0.0045 to $0.69 on the year when...

Elon announced he was going on Saturday Night Live.

Holders were euphoric and shouted DOGE was going to $1.

Meanwhile, GCR was unbothered. Moisturized. In his lane. Focused.

And he shorted DOGE in size.

His reasoning was simple:

GCR actually bought DOGE at $0.0002 in 2020 and was an early bull.

Pause for a second and think about how insane this is...

He flipped short on a coin that he was up 3,450x in a year‼️

But, he flourished.

The price cratered by 30% during the show.

GCR continued shorting every Elon-driven DOGE pump and made millions.

DOGE was a massive internet native cult.

It had a...

1. Charismatic leader (Elon)
2. Rituals and beliefs (memes)
3. Obedient following with an 'us vs. them' mentality (WSB vs. TradFi)

It became part of people's identities.

A similar setup started unfolding with LUNA.

Do Kwon was it's egomaniacal leader.

The die-hard community believed it was going to take over the world.

And ofc, its price was exploding...

LUNA skyrocketed from $0.65 to $99 in 2021.

Investors were also earning 20% APY on LUNA's stablecoin, UST.

But, there was a problem...

LUNA could be exploited.

Do dismissed the concerns and crudely responded to the whistleblower.

Do's narcissistic god complex was out of control.

He tried publicly embarrassing anyone who shared bearish LUNA opinions.

Meanwhile, LUNAtics were getting sucked deeper into the cult.

They got tattoos and shilled the coin relentlessly.

It felt like LUNA was going to the 🌖 until...

Algod called bullsh*t.

Do clapped back with the most infamous dunk in crypto history.

The exchange led to a $1M bet that LUNA would be lower in one year.

GCR was once again... unbothered. Moisturized. In his lane. Focused.

And upped the ante to $10M.

Do agreed 🤝

GCR tried pushing the bet to $20M but Do ghosted him.

So, he took out a $10M short.

Then, someone pulled $85M from UST and it began to depeg.

Do tried to save the LUNA ecosystem but...

LUNA death spiralled to $0.000006.

And GCR covered his $10M bet by buying 120k LUNA shares for only $0.72 😂

In the end, he netted $21.7M shorting LUNA.

And Freddie & Algod got the last laughs.

GCR's last mega short was betting against the entire crypto market.

Yes, we're a cult led by Satoshi and Vitalik

Fueled financial sovereignty, decentralization, and wagmi vibes.

In the fight against the fiat economy and for digital ownership

While crypto Twitter was calling for a super cycle...

GCR hired a team of analysts to identify the weakest tokens to short.

VC-backed projects with significant unlocks and weak narratives were his favourite.

He placed ~25 long-term shorts which he called "inverse investments."

Virtually everything cratered and GCR earned ~$26.4M.

Lessons from GCR:

1. Don't be a blind cult member
2. Sell the run-up & short the delivery
3. Projects led by egomaniacs rise & fall the hardest
4. "Inverse invest" in weak coins after the cycle's peak

END

I write two investor case studies like this per week.

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