Obviously, like all of crypto, it is extremely risky and can go to 0. That said, given the magnitude of potential outcomes, it just doesn't have to succeed that often to make it a massively +EV bet
While my time investing in crypto and previously playing poker has gotten me used to experiencing large daily personal net worth volatility, it's never a pleasant experience
Short thread (by my standards...) with some ramblings that help me get through it 👇
Obviously, like all of crypto, it is extremely risky and can go to 0. That said, given the magnitude of potential outcomes, it just doesn't have to succeed that often to make it a massively +EV bet
Unlike early stage tech, crypto investors will have liquidity, i.e. the possibility, and thus the temptation, to sell
This is both a blessing and a curse
Crypto, as early stage tech, is much riskier than established public companies and thus even higher vol too
However, one should not let the liquidity take advantage of us
However, the fundamentals themselves rarely change that much in such short periods of time and so neither should one's investments
Occasionally they may prompt a reevaluation of the thesis, but if one is investing based on fundamentals this should imo be rare
Beware of the rationalisations for selling that spring up during downturns
If anything, it should happen more during upturns as the investment becomes more expensive and therefore riskier
For most of us working + investing in the space, our net worths are already extremely correlated to crypto prices
More from Crypto
Where should I start?
1) Is Blockfi profitable?
2) How much money does BlockFi have on its balance sheet?
3) Is the yield that BlockFi pays to its depositors earned or subsidized by billionaire investors?
4) Has BlockFi ever been profitable?
5) Are you planning to go public?
1) Is Blockfi profitable?
2) How much money does BlockFi have on its balance sheet?
3) Is the yield that BlockFi pays to its depositors earned or subsidized by billionaire investors?
4) Has BlockFi ever been profitable?
5) Are you planning to go public?
When is the interview published? @otisa502
— Jakob.Cel (@HedegaardJakob) February 14, 2021