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“The institutions are coming” was a meme in the last cycle.

And it was partially true. Small businesses came. High net worth people came. Forward thinking public companies with bitcoiner leaders like MicroStrategy and Square/Block came. Even a few big insurance companies and asset managers dabbled.

But that was premature. The institutions just tasted. Their leaders bought with their personal accounts or otherwise understood, but couldn’t put big regulated money in. And it was a crazy time- with fiscal stimulus many things were a bubble.

I talk to some institutions, and like, they get it now. That’s not exactly news when Larry Fink is on tv calling it a flight to quality. But I will reinforce it anecdotally- institutions increasingly get it, or at least some of it.

Most people only see the prior cycle or two. They don’t see all prior cycles since inception because that requires looking at a log chart and putting in a few hundred hours of research.

Bitcoin has to get big enough to hit your radar, lead you to form an opinion on it, collapse, and then hit your radar even bigger again, for most people to get it. It’s not about “all cycles”; it’s about their *specific* cycle of understanding it, forming an opinion, and then seeing another cycle that either validates or challenges their opinion.

Also, many people will get emotional this cycle. Fade emotions and focus on fundamentals.

Anyway, enjoy your evening.

Kane McGukin 2y ago

The meme’s do get ahead of themselves each cycle. With many of the flaws that weren’t apparent in the hype showing up in the middle to the end.

One of the best protections I’ve found is to try and stay true to the core of Bitcoin’s ethos. To step away from the noise and hype, and try to think critically and be unbiased in reviewing and reflecting upon the realities of what a meme is suggesting. This helps to be more realistic about the possibility and timing for which it would actually play out.

Most memes seem to insinuate the outcome will be within a week, month or year; which creates a lot of FOMO.

If we step back and look at the past, we can gain a better understanding of how long it actually takes markets to come around major change.

Especially when it involves the way we think about and use money.

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Discussion

424ad77e... 2y ago

I try to think about it like this; "What does it mean to have 'outside money'?"

Kane McGukin 2y ago

That’s a good why to think. Who wins? Who benefits? What changes?

Outside money, especially in large size, typically comes with greed, fees, or overhead costs. It’s where middlemen usually siphon off a portion and that tends to grow over time.

It’s part of moving from the hobby phase to the business and revenue generation phase. To put it in tech terms, it’s when you move out of the garage and into an office and start marketing.

424ad77e... 2y ago

That seems like a pretty good description of what I always understood to be outside capital.

I was thinking more of money that is outside of counterparty risk.

IE, bearer assets. Monatery metals, collectables, bitcoin.

When I think of outside money, I think of money that is outside of anyone else's control.

Kane McGukin 2y ago

I agree with that. Sorry, I took the liter fund flow view.