Bitcoin: The Beauty of Mathematics (Part 70)

追加: 2026-05-07

[00:00:00]Hey everyone, and thanks for jumping back into the cryptoverse.

[00:00:04]Today, we're going to talk about Bitcoin, the beauty of mathematics, part 70. If you guys like the content, make sure you subscribe to the channel, give the video a thumbs up, and also check out the sale on Into the Cryptoverse Premium at intothecryptoverse.com.

[00:00:20]Let's go ahead and jump in. So, this is coming a little bit later in the month than I normally do it. I normally do it around the 1st, so it was a little little bit delayed.

[00:00:30]Right now, the current valuation of the cryptocurrency asset class is around 2.7 trillion, which is still fairly below where that {quote} {unquote} fair value logarithmic regression trend line is.

[00:00:43]And unfortunately, it is likely to stay that way for the rest of 2026. We might see that change next year, uh or the year after, but this is sort of the cycle where there wasn't a euphoric rally. Now, when you look at this chart going all the way back to 2010, what you'll see is that in the euphoric rallies, that's where Bitcoin and the entire asset class durably go overvalued. You can see it was in 2011, and in 2013, 2017, somewhat in 2021, but it also didn't quite make it all the way up to the extremes up here. And if you think about it, it kind of makes sense because in 2021, that was the first year that Bitcoin really started to have to worry a lot about the macro data, right? That was when we were starting to see inflation and and and labor market concerns pop up, which hadn't really been a concern in the past with the exception of the blip that we saw in COVID in the pandemic.

[00:01:42]And so, it topped out somewhat euphoric back in 2021. I mean, it was, but not quite as euphoric as maybe what we saw in some of the other peaks. But then, when it came back down, monetary policy, higher for longer, all the all the different macro concerns, it basically just led to a bull market where Bitcoin topped on apathy rather than euphoria.

[00:02:08]And you can see there wasn't really a durable move to the overvaluation territory, and this is also similar to what we saw back in 2019, right? Where it went overvalued, but not by a lot, right? Not not really that much. Um and ultimately we just kind of came back down, spent some time being undervalued for a while, and then eventually we got to that overvaluation regime.

[00:02:33]So, I wonder if that's the way this ultimately plays out is that we just spend the rest of 2026 in this undervaluation regime, and then perhaps next year we could hopefully start to see this change.

[00:02:49]Um But right now, I don't really see it changing. That doesn't mean you can't have rallies. I mean, we're in a rally right now, but what's crazy is if you think about the current rally that crypto is in, the total market cap on this chart hasn't really done anything, right? Like it it it hasn't really moved a whole lot. And that might seem kind of crazy, especially considering that Bitcoin is trading over 80,000 now, but if you look at the valuation of Bitcoin against essentially every other asset class this year, it's actually down, right? Like Bitcoin's down against the stock market, like the S&P 500, it's down against the Nasdaq, it's down against gold. Um it's down against energy, right? It's down against most things. And so, while it is up, it it's basically just back up to where it was a couple of months ago, whereas most everything else, um you know, is still very much positive in terms of the year-to-date ROI. So, I would expect this to stay undervalued for the rest of the year, and then perhaps in the next cycle we'll see it go back up. Now, if you take the percent difference between the total cryptocurrency market cap and the fair value logarithm and that congressional trend line, you get a chart that looks like this.

[00:03:55]And you can see it's been a while since we've been this you know, sort of this undervalued, but it has happened. Wait, we saw it in 2015. We also saw it in in 2010, 2011.

[00:04:05]You know, I think we'll just kind of grind out at some of these levels down here. And then hopefully we'll get one of these other peaks off in a in a future cycle. But those are my thoughts.

[00:04:14]I mean, I know the total cryptocurrency market cap right now is only at around 2.7 trillion.

[00:04:19]Look, eventually I think it will go to 10 trillion, plus or minus a few trillion. And as we go to sleep at night, we cannot help but wonder, what's a few trillion dollars among friends?

[00:04:28]Thank you guys for tuning in, and I'll see you next time. Bye.