00:00is leading this spectacular plunge and a lot of investors are asking themselves is the party
00:07finally over today we're going to break down exactly what is happening and more importantly
00:12why so first let's just get a sense of the scale we're talking about here we're looking at a massive
00:1845 drop from bitcoin's all-time high i mean entire accounts have been wiped out seemingly overnight
00:24and even the biggest players are feeling the heat so let's be clear this isn't just some
00:29minor dip it's a full-blown collapse that has shaken the market right to its core so the big
00:35question is why why now well this sell-off isn't random it's not just a bunch of retail investors
00:41panicking there are some really powerful forces at play here and we're about to unravel all the
00:45complex factors driving this thing and what it could mean for the future to really understand
00:50what's happening you have to look at five distinct catalysts that have basically combined to create
00:55a perfect storm each one of them plays a really critical role in the story of this crash
01:00okay so it all starts with investors turning what we call risk off with all the economic uncertainty
01:07they're moving money out of speculative things like crypto and into safer havens at the same time the
01:12us dollar is getting stronger which makes holding bitcoin as a hedge you know less attractive then
01:17and this is a big one you have the etfs the very things that drove the price up are now making the
01:22crash worse see as people sell their etf shares the funds themselves are forced to sell actual bitcoin
01:28which creates this nasty downward spiral on top of all that there's just no more good news to keep
01:33the hype going and all of this leads to the final catalyst a total loss of conviction where people
01:38just lose faith and decide to get out you know this crash has really reignited a fundamental and super
01:44polarized debate about what bitcoin's value truly is on one side you have some of the biggest names in
01:49finance calling it completely worthless and on the other you've got titans who see it as the future
01:54let's take a look at this battle of ideas in one corner you've got the critics right legends like
02:01warren buffett and the late great charlie munger and in the other corner you have the believers we're
02:06talking the heads of the world's largest financial institutions from jp morgan to blackrock what's so
02:12fascinating here is that many of these believers were once the fiercest critics themselves
02:17the intensity of the criticism is pretty striking i mean charlie munger famously called bitcoin
02:22rat poison squared skeptics argue you just can't value it because it doesn't produce anything
02:27it has no real intrinsic worth in their view it's just pure gambling you're just betting that the next
02:33person in line is going to pay more for it than you did but then you see this larry fink the ceo of
02:39blackrock once called bitcoin an index of money laundering today he says it has the potential to
02:44outperform the internet and he's not alone you've got jamie diamond of jp morgan and the billionaire
02:49ray dalio they've gone from calling bitcoin a fraud in a bubble to now saying it's a legitimate
02:54financial tool and one hell of an invention this dramatic 180 from some of its biggest critics
03:00is a huge part of the story here so with all these conflicting views flying around how do we make
03:06any sense of the current chaos well probably the best way is to just step back from all the opinions
03:11and look at the hard data because what we're seeing right now it's part of a long long history
03:16of extreme volatility and this really shows it perfectly these massive crashes are not new for
03:23bitcoin not at all in fact you could say they're a recurring feature we saw an 83 drop in 2013 another
03:3083 drop in 2018 and even a mind-boggling 99 collapse way back in 2011 so historically speaking seeing your
03:40investment get absolutely hammered is well kind of a normal part of the bitcoin experience this wild
03:46pattern has led to a really popular theory known as the bitcoin four-year cycle the idea is that for
03:51the last 15 years bitcoin has followed this strangely predictable rhythm you get a period of quiet
03:57accumulation then a massive parabolic price bubble which then like clockwork leads to a devastating 80
04:02crash and then the whole process just starts all over again now during these crashes fear and
04:08misinformation can spread like wildfire so let's just take a quick second to address two of the
04:13biggest anxieties that are fueling the panic right now and separate the facts from the fiction
04:18first there's a ton of chatter about michael sailor you know the guy whose company holds over three
04:23percent of all bitcoin getting liquidated and collapsing the entire market this just isn't accurate
04:29he doesn't use margin loans like a normal trader he uses something called convertible debt
04:33just think of it like a long-term loan there's no magic price at which he's forced to sell the real
04:39risk is that he might have to dilute his company's stock in a few years to pay back those loans
04:43not some sudden market crashing fire sale second there's the fear of quantum computers breaking
04:49bitcoin's security and while yeah this is a valid long-term concern it's not an immediate threat
04:55these kinds of computers don't even exist yet on a scale that could do any damage
04:58and just like any other software bitcoin's code can be and will be upgraded over time to become
05:04quantum resistant long before it ever becomes a real problem so how should anyone even approach
05:11such a volatile and polarizing asset well this final section isn't about giving you financial advice
05:17it's about providing a rational framework for how to think about bitcoin especially in moments exactly
05:23like this one it really starts with this simple but incredibly powerful mantra when you get that
05:29fomo that feeling of missing out as the price is skyrocketing that has historically been a terrible
05:33time to buy and when you feel that pit in your stomach that panic to sell because it feels like
05:38it's all over well that's often been a good time to hold or even buy the key is just to avoid making
05:44decisions based on these extreme emotions a rational approach is really built on three core principles
05:50first discipline is more important than conviction it doesn't matter how strongly you believe what
05:56matters is sticking to your plan second your position size matters way more than your price target
06:01sizing your investment small enough so that these huge swings don't totally ruin you is absolutely
06:06crucial and finally consistency always beats trying to time the market perfectly so the most important
06:13takeaway is this bitcoin is not a shortcut to wealth it is a high-risk growth asset with what they
06:19call asymmetric upside and the trade-off is simple your chance of making a lot of money is directly
06:25tied to your chance of losing a lot of money it is not a safe haven and you absolutely do not need it
06:31to build wealth long term and that leaves us with the ultimate question doesn't it every crash is
06:37different of course sparked by its own unique reasons but so far this cycle of doom despair and
06:42eventual recovery has always held so is this collapse just another brutal but predictable turn of the wheel
06:48or is this the time that the cycle finally breaks that right there is the billion dollar question
06:54everyone is trying to answer
07:02you
07:04you
07:06you
07:08you
07:12you
07:14you
07:16you
07:18you
07:20you
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