Episode Details

An extra piece for you this week. I had planned to follow up on Dr John’s timely piece on oil and gas today, but it will have to wait.

We need to talk about bitcoin.

Since peaking at $126,000 in early October, the bitcoin price has been in freefall, and the declines have accelerated this year. Earlier in the week, it touched $60,000 - declines of over 50% from peak to trough. Today it sits at $67,000.

Call it what it is. It’s a bear market.

Here’s a 2-year chart so you can see the price action. All the gains of 2025 have been given back and we are back at 2024 levels.

Bitcoin has become a software proxy

My first observation is that bitcoin’s decline since October has coincided exactly with a brutal selloff in software stocks, even as hard assets - gold, silver, and other metals - have caught one heck of a bid.

Just a few years ago, hard assets had no value, it seemed. Forget land, mining, the real economy. It was all about digital, software, IP, trademarks. How things have changed.

This chart appeared in a WhatsApp group and I don’t know who made it to give credit, but the story is clear: Bitcoin has become a software proxy and vice versa.

The correlation is striking. As concerns around AI have hammered software more generally, bitcoin has followed.

Hardware plays within tech have held up Maybe they're next to be hit. That remains to be seen.

When the mainstream media calls the bottom - the next wave of bitcoin obituaries

The Financial Times, wrong about bitcoin since 2009, came out with its latest stupidity this week claiming that bitcoin is $69,000 overvalued.

Yesterday the Daily Mail joined the Retard Gang in telling us bitcoin will go to zero.

Remember: just as media frenzy often indicates the peak of a market, so does a media scrum at the bottom.

All we need is a high-profile article from the Economist and the lows will be in.

I get that some people don’t like bitcoin, and bitcoiners can be obnoxiously vocal when the price is rising, but nocoiners can be just as bad. The amount of people trolling me about bitcoin - cc-ing me into tweets telling me how badly it’s doing, slagging off Michael Saylor, sharing “going to zero” articles - has risen sharply.

The more evolved and widespread these narratives, the more people repeating them, the closer we are to an end.

On which note, here is a longer-term weekly chart of bitcoin. That weekly RSI is close to all-time lows. Doesn’t mean this is the end. But you get these kinds of sentiment extremes at the end of cycles, not at the beginning.

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Where we go from here

This is a bear market. Crypto winter is upon us once again. The trend is down.

But the trend will end. It always does.

Looking at the above charts, there’s a lot of price memory in the $50-70,000 range. Bitcoin spent much of 2021 and 2024 here. I expect $50,000 - or just below - to hold. I give that a more than 50% probability.

But it’s bitcoin. So anything is possible. A typical bitcoin monster correction would see us go all the way back to the 2022 lows at ~$15,000. I don’t see that as likely - especially as the preceding bull market wasn’t that mammoth - maybe 10% probability.

It’s also possible the lows are already in, but my gut tells me this bear market has a bit longer to play out. It’s not a short sharp correction like we saw in the spring of last year around the Tariff Tantrum ™, but more