Use This "Cheat Code"
(For The Entire Digital Assets Space):
All digital and crypto assets follow Bitcoin.
T/A doesn't work for crypto because the simple fact of the matter is the entire crypto market follows the trajectory of Bitcoin - most lag it, but some front-run it.
This includes altcoins, tokens, memecoins and crypto or Bitcoin stocks - including the ETFs, and Bitcoin is playing by a different set of rules than swing-trading, daytrading or technical analysis.
The base thesis lays out why, but once you understand that, the only question then is:
How to avoid the ones that will lag Bitcoin, and optimize for the ones that will front-run it?
That Includes the World's Most Bitcoin-Dependant Stock
We added Microstrategy (MSTR) to The Bitcoin Capitalist portfolio in July 15, 2023 when it was trading at $45.80 / share (after you adjust it for the 10-for-1 split on August 8th, 2024)
Today it's trading at just under $200/share - for about a cool 410%+ gain with Bitcoin up a little more than double, ~ 110% in the same time.
How Did We Know To Add MSTR to the Portfolio?
...and give it a 10% weighting? (we have it at 15% now)
Michael Saylor's Microstrategy has been around a long time. It had its day in the sun during the .com boom, but then - as with all the other high-flying stocks of the era, it crashed and then limped sideways for 20 years...
Then, in 2020 Michael Saylor reinvented the company - taking all it's free cash on the balance sheet and using it to buy Bitcoin:
TBC readers understand why this is working, and will continue to work for the duration of the unfolding monetary regime change.
MSTR's fortunes are entirely dependent on the fate of Bitcoin - if, for some reason Bitcoin flames out and becomes a zero, MSTR will flatline - it doesn't matter that it's built atop a $500M ARR data analytics business - the company is a leveraged proxy to Bitcoin which is why MSTR is up over 400% since last year while Bitcoin is up 110%.
What about this latest stock?
Our latest pick, the one that's up over 400% 526% in under 60 days started out as a good ole fashioned, Ben Graham-style "net/net" - we bought it because it was trading for less than the value of its crypto assets (and had no debt).
As odd as it seems, this venerated, value investing tactic which made Warren Buffett's mentor wealthy over a century ago, turns out to be relevant when it comes to the digital asset space.
Whenever we find a rare opportunity, one where we uncover an obsure, publicly traded stock that's quietly sitting on more crypto-currencies on their balance sheet than the entire company is worth on the stock exchange - we step in and we buy it.
My reply to Larry was a somewhat off-the-cuff "It's all skill, man", but I was serious when I told him:
"When you buy something for less than NAV, it's hard to lose."
Investing in crypto assets is all about asymetric bets:
The kinds of companies we constantly scour the corners of the markets for have unique setups:
If we could sum up The Bitcoin Capitalist in two sentences, it would be:
Number 1) We provide a base case thesis for why the world is undergoing Hyper-Bitcoinization, and we cover that from all angles, every month:
Macro, bonds, liquidity, interest rates, CBDCs, geopolitics, even high weirdness and Clown World.
Number 2) We scope out tactical and strategic vehicles to ride this epochal wealth shift and keep our readers on the right side of this monetary transition.
Bombthrower Subscribers deal:
Start a $9 trial of The Bitcoin Capitalist...
***Please note: This is only for serious investors with a long-term investment horizon. If all you're looking for is steady stream of daytrading opportunities, this is not the service for you.