There are people alive who bought bitcoin under 10¢. Not many, but I just saw a podcast with an investor who bought at 3¢ per bitcoin.
I gotta admit, I was jealous. He paid slightly less than half of what I paid.
Of course, I was late to bitcoin.
Everyone is late to bitcoin and nobody goes in hard enough the first time (a truth I’ve come to appreciate via @hodl).
I bought my first sats at 11k in 2018. it went all the way down to 3k, but I didn't buy aggressively again until 6k. seems like pennies now. do I wish I had bought one year earlier at 800? of course, but I didn't understand it then. wish I had bought harder at 3k. I am geareful to have what I have.
Same 🤙
I stacked pocket change via coinbase monthly since the beginning. Getting a measly 0.1 bitcoin a month seemed like a waste of $20-40…and getting a measly 0.025 bitcoins a month seemed like a waste of $40…and 0.001 bitcoins a month seemed to be a waste of money…
When I finally got a job, I still stacked only pocket change for 3 years until plan b released his S2F model. Then I started stacking moderately…and it took a while before my 2019 stack caught up to my pocket change stack from pre-2019.
Lesson learned: nobody goes in hard enough the first time.
I hate to say it but S2F was part of the reason I started stacking hard. I don't knoe how people feel about him now, but he seemed to fall out of favor.
Only stupid people dislike his model.
Plan B always says “all models are wrong, but some are useful.”
S2F is wildly optimistic in the long run but it matches history and power law model fairly well right now, but in 2 halvings it will become clear who was right, power law or s2f…
Do I think s2f is wrong? Not yet. But soon it will be. Has it been useful? Heck yeah. But if you’re tying to plan 10+ years in to the future, use power law model.
i haven't looked at it in years, but it seems to be holding up. I think one of the biggest detractors was Corey Klippsten from Swan Bitcoin. I can't remember what his issue was.
At any rate, looking at the graph was instrumental to getting my wife on board. She doesn't care about the definition of sound money. she just wanted to know that ngu.
Here's the current chart.
Yup. Price is already a little conspicuously below model line. Area under the curve is far higher since 2022 than all time before 2022.
I wonder what the orange run up will look like in this cycle. It's a little weak right now. And I don't see us getting up to the $1m line before the next halving, but you never can tell.
Power law model price now is $88k ish. $119k in Jan 2026, $165k Jan 2027, $225k Jan 2028
seems underwhelming. I don't believe institutional and state level buying are priced in.
While that may seem underwhelming, it is what one would expect _on average_ by looking at history and applying a plausible curve to fit the data as best one can.
While the trend line price is the real power in bitcoin, everyone is attracted by the blow off tops. Annual rates of return of 43% for 2025, 42-40% for 2026-2028 is in and of itself remarkable.
Will there be a period of time in the next few years where bitcoin price will be well above model price? Yeah. If you want to capture 95% of the daily price points in a band around the power law, simply take the model price and divide by about 2 and multiply by roughly 4.
Interestingly, if price deviates from power law model, it would imply something very profound about the money distribution amongst those new to bitcoin…power law progression would imply they hold a specific large fraction of the money supply, but if price is much much higher than expected, it’s because they have way way more money than everyone else in the market assumes.
If price fails to get up to model price, we’d know they have less money than expected.
So are the next entrants to the market richer than we expect or poorer? Time will tell.
I'm guessing richer since the next round seems like it will be large buyers probably mostly going through ETFs.
To your point above, a cagr of 40% is quite high and does lead to high price levels in 20 years. I believe Saylor ran his cagr projection at 20% and ended up at $46m per coin in 2040.
did you see Plan B is trading his bitcoin for an ETF? 🤦♂️
Meh. I suspect he’s going to have his bitcoin identity death.
Why? Two reasons.
1) security. He probably values all of his fingers. https://timesofindia.indiatimes.com/world/europe/10-arrested-in-france-over-kidnapping-and-torture-of-ledger-co-founder-and-wife-both-rescued/articleshow/117529185.cms
2) his model has been very useful but everyone who can do math knows eventually his model must fail to match reality. The fact that it has worked as well as it has from 2019 until now is a massive success.
Trust me. I’ve been around since July 2010. I’ve seen many disappear. I’d have disappeared too if I were smarter…because if I were smarter, I’d be phenomenally rich 😂
your first point is very interesting. all of these influencers are in a dangerous position being known as people who have a high stake in self-custodied bitcoin. dangerous to both themselves and their families.
Exactly.
Right now, the only ways to access security easily boil down to a scavenger hunt, with or without either a PIN code on a hardware wallet and/or a passphrase on the seed at the end.
But there has existed since the beginning of bitcoin a way to post date bitcoin transactions…and recently we can now time lock utxo’s directly for up to about a year. Combined these should be very useful primitives for time based security rather than space based security.
The power law model is a psyop to keep normies from becoming maxis. Very disappointing to see how much play it is getting this cycle.
Every cycle brings new disappointments
👀
Gotta keep the signal strong. Don’t let the noise distract from the real path.
lol…no. Flat out no.
All models are wrong. A wide variety of models could be used and fit bitcoin price over a period of time. That’s math. But what type of model makes sense? It’s true S2F and power law models fit historical price data well; both fit far better than any straight line.
But inherently exponential models can’t both fit for a long time and have a high slope today. Power law models can because the rate of change of their slopes is constant. Exponential models have an ever increasing rate of change of slope. One can’t expect eternal acceleration, especially if slope is already high.
For bitcoin to grow in dollar price as an exponential and for an exponential to fit the price for a long time, bitcoin price would have to be growing far more _slowly_ than power law model — otherwise a predicted price of infinite dollars happens way way way sooner than you’d expect.
Absolute scarcity and the halving results in fewer coins being competed for on the supply side all the while more demand is coming into the market. The price moves should be exponential and - yes - we should approach “infinity” (as you say it) relatively quickly vs. slowly grinding there via the power law.
Why would anyone who understand bitcoin own real estate as an asset for storing value, for example? Why would anyone own a treasury that has a 4+ year duration? All that capital is coming for bitcoin. All the while, just a little less than 95% of bitcoins are already in circulation. And they’re increasingly in hodlers hands.
I agree with everything above except exponential. US M2 money supply is exponentially growing…but its rate of growth is way way slower than bitcoin power law model. Power law for bitcoin is far steeper price vs. Time than expansion of M2.
In 50+ years, power law predicts bitcoin price growth rate will be roughly the same as M2…whereas S2F would imply bitcoin price would be increasing faster than ever. Time will surely tell here. All we have to do is wait to find out. But I guarantee you that if you live long enough, you’ll see the end of every exponential process in progress today.
Yes but the FTX manipulation was very significant. Huge in both paper bitcoin as well as blow to retail confidence.
Totally agree. Biden admin shenanigans and China mining ban didn’t help either.
If we turn the thing around and view this as a problem of bitcoin the network acting as the programmer of humanity, the exponential S2F model would have predicted bitcoin would have done a better job programming people…maybe even predicted bitcoin would program people so well that FTX doesn’t happen.
Is Bitcoin not programming people fast enough? Or is it our model that is too optimistic. My gut says humans will respond to bitcoin programming eventually…like an S curve.
10 cents? Or 10k usd?
Not sure what you mean
Cents.
There was a brief time when my laptop provided roughly somewhere between 1/64th and 1/256th of the network hash power.
Bitcoin had no value at that time. Difficulty rapidly increased and I never mined another block after my first two or three days mining.
When a market opened for bitcoin, I bought some to help kick start the market, but it was rather expensive and I was a poor resident.
The funny thing about the earliest miners I know: many are not rich. We were stupid and used the money to either make life tolerable (like buying a car) or to try to start another venture (mostly mining). Nobody realized the bitcoin couldn’t be spent on anything better than bitcoin in the long run. But this is how the market works.
I’m grateful for those who decided to retire early…they’re forced sellers!
Amazing insight. Thanks for sharing
There will have only been a tiny fraction of the global population that was close to Bitcoin at that time
I wonder: what few things you knew, and researched, that took your life to that point
Fascinating
Easy: I got the shit kicked out of me and had all my money stolen at a pivotal time in life. I was maybe 12 or 13. I had $300 saved up and it was my intention to use savings to get out of a shitty situation and make it to college.
Losing that money was a tough pill to swallow. Fast forward 20+ years and I read a slashdot article on Bitcoin. And then immediately I read the white paper, which is rather informal and easy to read compared to my undergrad training in astrophysics and math. I was running Bitcoin software within minutes. Only learned I had to select generate from a menu like a day or so later (the burden of being busy is that stupid things happen frequently).
It was a desire to provide a safe place for others to store money that can’t be stolen that lead me to mine. I was fortunate to have the right technical background to understand how bitcoin could work but not so much education so as to see ways that it might not work…Goldilocks zone for heart and head education pre-bitcoin.
Brilliant. What a journey
I love how seemingly unrelated things combing to create decisions and then outcomes
While I didn’t understand it at the time, the longer I live the more clearly I see God’s hand in my life.
Enumerating such blessings becomes a difficult task when things that seemed to be simply completely bad end up being pivotal blessings.
And now, most people will never own 1 Bitcoin.
Not because they don’t want to, but because they won’t get the chance.
Yup. I started mining in the GPU era. Gave away a lot of the little I did mine back then. Spent most of the rest on rent one month while in grad school.
I hear ya. I sold 100 bitcoin to make a mortgage payment because medical bills for my middle daughter cost me all my money.
If I were smarter, I would have borrowed money from the in-laws. They would have happily paid my bills and taken payment years later if need be. But asking for help was foreign to me.
If I were a genius, I would have borrowed $10k from in laws and bought 100,000 bitcoin. In laws probably would have taken me up on this, but at the time this seemed like an impossibly large amount of money.
