And on the 7th Day, the Bitcoin God Rests

One of the most important books for new investors to read is “Random Walk on Wall Street.” It says stock returns are random. Bitcoin returns? No so much… Sell on Saturday and buy on Monday.

This chart shows the average excess return by day for Bitcoin and the SP500 (represented by SPY) since 2014. On average, each week, if you shorted BTC on Sat night, covered on Sunday night and went long, and sold on Monday, you would have made a profit of 0.65% per week.

One of the biggest differences between Bitcoin and stocks is the Bitcoin market literally never sleeps. Christmas? It’s trading. Sundays? It’s trading. Super Bowl? it’s trading. New Years Eve? It’s trading.

But the problem is almost no one is going to trade 24/7 all year long. They will take a day off. And who is going to hold Bitcoin if they aren’t paying attention when it’s average daily move is 3% and 10% moves aren’t uncommon?

Thus, you see a clear pattern: sell Saturday to take off Sunday and start the game again on Monday.

(You see a little pattern for stocks – a lot of that has to do with information release schedules but it’s tiny compared to BTC.)

Making Hay While the Sun Shines

Nothing much from Crypto-Bulls lately… but now… Bitcoin is Up! DOGE is amazing!!! Last chance to get in!! Meanwhile, the “printing press” of Crypto tokens is cranking out new supply while prices are high.

Below is the market cap and year over year change in the supply of Crypto tokens (in Bitcoin terms). You can see the supply is increasing over 35% per year at this point.

Even though most crypto prices are well below their highs still, the overall value of the crypto market isn’t that far from a new high. Why? Supply is increasing so fast even if the price doesn’t change, there is a big increase in the market cap.

Remember – except for Bitcoin – most cryptos are not supply constrained. And remember… that means they aren’t worth the 1s and 0s they are printed on.