Bitcoin: Tread Cautiously

Pete Weishaupt
3 min readJul 8, 2021

In a recent episode of Panic with Friends, Howard Lindzon sat down with Vinny Lingham to talk “What’s Next for Crypto Following the Epic Crash.” Their insights are worth heeding. One thing people get wrong is there is no absolute advice in crypto that’s correct.

Vinny is skeptical about the scalability of bitcoin in the long-term, but he’d be happy to be proven wrong. The store of value narrative is in vogue now. It used to be digital currency. Just remember, narrative changes over time.

Elon’s bashing of bitcoin probably means he doesn’t buy this current narrative. The whole energy efficiency and ESG thing going on right now comes into play. Vinny acknowledges he still has concerns, but that doesn’t mean you shouldn’t own bitcoin. If you going to have a portfolio, you’ve got to have bitcoin in it. We don’t know where the world’s going.

Does it make sense to be 100 percent in bitcoin? Absolutely not! While bitcoin is the first coin, it’s foolish to believe it’ll be the only coin. Clearly it isn’t, and there are lots of other coins that have different use cases and utility. The narrative hasn’t played out to where we have bitcoin at a million dollars. People didn’t believe in a 50 percent pullback. They said, “Oh the institutions are coming in and you’re never going to see a big drawdown in bitcoin again.”

It was all bullish mindset. The store of value narrative isn’t right. While it may become one in the future, a solid store of value asset can’t lose 50 percent of its value in a week. It’s a moving narrative and maybe it’s moving less now, but it used to be peer to peer digital currency. It’s evolved to the current narrative of digital gold. Elon killed the institutional trade because the institutions looking to buy it were now worried about the woke mobs coming after them for buying and holding bitcoin.

If you believed bitcoin was going to $500k or a $1m because the institutions are going to pile in — that narrative was killed dead in it’s tracks. If you expect to have a global decentralized currency for the world, it should be impossible for one person’s opinions to move it. True liquidity isn’t viable for anything that drops 50 percent.

It’s one thing to be in it for the long-term, but the maximalist approach to bitcoin is very dangerous. You’re playing with people’s lives in a very bad way. Not everyone can afford to survive another three-year bear market. They need their capital. Unfortunately, many are getting…