Bitcoin: The Beauty of Mathematics (Part 39)

Hey everyone and thanks for jumping back Into the crypto today we're going to Talk about Bitcoin the beauty of Mathematics part 39 if you guys like the Content make sure you subscribe to the Channel give the video a thumbs up and Check out intothe cryptoverse premium at Intothe cryptoverse decom let's go ahead And jump in so again I know it's called Bitcoin the beauty of mathematics but it Is of course of the entire Cryptocurrency outside class as of October we are looking at a total market Cap of 1.19 trillion where the fair value Logarithmic regression trend line fit to All data is now sitting at 2.42 trillion This represents an approximate Undervaluation of 48.2 4% the general Expectation that we've had for the Entire entire prehab year is that we Will likely spend the prehab year below The red logarithmic regression trend Line the fair value but above the lower Green regression trend line which is Sort of that lower bound my expectation Has been that eventually Bitcoin will Touch the lower green logarithmic Regression trend line before going into In a sustained way the overvaluation Phase you can see that we did this very Thing last cycle as well it might not Look like we we tagged it uh but this is Just looking at Daily data if you

Actually look at at hourly data and you Go back and look at at where total Market cap went it did go back down to Around that level we could actually just Go go double check right now right don't Take my word for it what if I'm wrong um So let's go take a look here so let me Pull up total market cap so we're going To pull up total market cap and from Here we're going to go look to see what It did in March of 2020 and you can see That the low so like if you look up here At this low uh was 108 billion right 108 billion was where That low on total market cap went and Then if you go look over here where was This lower bound right it was at$ 1090 Billion so yes it doesn't look like it Tagged that trend line if you include The wick it did maybe we should just put The wick on there just so people are Aware but we did tag that green trend Line before going off into a more Sustained bull run where we went into The overvaluation phase for a long Time I suspect the same thing is going To happen again right so you kind of see Here right I mean like the where we Already were you know the the fair value When we were back over here in December 2022 the fair value was or sorry the Lower bound was at 500 billion and we Went all the way down to 800 billion now The lower bound is around 700 billion

And we're currently at about 1.07 eight Trillion so again it's not about the Exact price remember the argument is That crypto adoption is occurring Constantly therefore the fair value of The asset class is a monotonically Increasing function we know that prices Do not always reflect reality sometimes We go overvalued sometimes we go Undervalued and right now the asset Class is is uh theoretically undervalued But we can stay undervalued for a long Time and just like last cycle and like The cycle before that I suspect that we Will tag the lower green regression Trend line before we have enough really Juice to send this thing into a more Sustained Bull Run that can take us well Into the overvaluation phase now whether That occurs because total market cap Goes sideways until we hit it or whether We go down into it is OB viously up for Interpretation but I'll say this you Know if you look at where total market Cap is today it's at the same spot it Was it was at a year ago but altcoins Are not most altcoins are down Significantly from where they were a Year ago the reason total Market capap Is the same is because Bitcoin went up But most everything else went down so This is the rotation of capital right This is the the the the the Bitcoin Dominance rally that occurred occurred

While total market cap went Sideways right it was a rotation of Capital capital from high risk to lower Risk and normally when we tag the lower Green regression trend line it is upon That secondary scare for Bitcoin right Once there's no longer enough liquidity In the cryptoverse to support the Valuation of Bitcoin USD it then drops It crashes the altcoin market one final Time that leads to the end of the Altcoin Reckoning we go into either a Recession or recession scare the FED Prints money and we all repeat the same Process again but that is where we Currently are today and my expectations Have not changed I think we'll be Between these two trend lines for Basically the entire year and I think That eventually we will go down to about 65% Undervaluation um we're currently at 48% And the way you get to 65% of course is Either you go down into it or you go Sideways long enough to where the fair Value is is so much higher because we've Just gone further in time so that's Where we currently sit with regards to This and and again you can always take The percent difference between the total Market cap and the fa fair value Logarithmic regression trend line if you Do that you get a chart that looks like This right and you can see that last

Cycle and the cycle before that we ended Up going all the way down here sort of Look at the horizontal line we are Getting pretty close but we are still Sitting just above it it is a very slow Grind down is my guess and I mean I know Bitcoin's up today and I'm sure a lot of People are hoping I would talk more About Bitcoin short-term price action But these videos are important like the The Bitcoin Beauty mathematics series They're probably some of the more Important videos I put out there they're Not based on short-term price movements They're looking at the bigger picture And how we navigate the cryptoverse over The more macro scale it Tunes out all The noise of daily moves and weekly Moves and are we above you know are we Above a certain technical level or are We not it ignores all that it doesn't Care about all That you know when we look back at this In a few years all we're going to see is That we became more and more undervalued Throughout 2022 and 2023 and yes there Was a little bit of a pop here by the Asset class but the reason it kept going More and more undervalued is because the Fair value was going up but the altcoin Market was bleeding A lot and the way you get down here to These lower levels is usually upon the The termination of the secondary scar by

Bitcoin where altcoins finally bottom Out the altcoin Reckoning you know is Finally over so that I think is is what We are are still looking at today and The other thing the other thing we can Overlay the risk on here right the we do Have the total summary risk we talked About this on the channel before but It's kind of cool to Overlay that on This chart just occasionally um to to Sort of just remind ourselves of of Where we are and I mean you you what I Like to do is is to sometimes um hide Everything except for maybe the Lower risk bands and then the higher Risk bands right and let me just remove Total market cap right so look at that It's kind of interesting when you look At it like that Right you're just looking at high risk And low Risk and we are currently in the Undervaluation territory Now what's interesting right what's Interesting and again like this is what I said before it's dangerous to DCA Altcoins and prehab years because many Times they just keep going down and Putting in new lows risk total Bitcoin Risk has been blue for a while right but Altcoins just keep going down so that Shows you why you know if you want to Exposure to crypto Bitcoin ideally is Where you would want to be over the

Altcoin market right and if you isolate Just lowest risk ban you can see that we Haven't even hit it yet in this prehab Year and normally we do hit it in the Prehab year right 2019 we were we hit These lower the lowest wristband 2015 we Hit the lowest wristband and 2011 we hit The lowest wristband 2023 we haven't hit It yet will We we'll see that's where we currently Are hopefully you guys like the content Of course we'll talk more about about Bitcoin and and everything as the week Goes on we did get a close above the 20we SMA which of course we'll talk About but this video I wanted to go Ahead and get out because it is the First of the month it's actually about To be the second uh day of October so Let's go ahead and get this one out and Then we'll move on to other videos as The week goes on thank you guys for Tuning in uh leave any com if you have Any any comments about about this stuff Make sure you leave that down below and And the last thing I I'll sort of always End with is is that I do I mean I still Do expect total market cap to Trend to 10 trillion right I do I know a lot of People think I'm I'm just sort of macro Bearish but what I'm more bearish on Right now is just the the um the Recession risk that I think is going to Materialize at the end of this year or

Early next year and we I've talked about That for a long time now right we've Talked about that forever just like it Materialized in early 2020 just like a Recession scare materialized in in you Know 2015 2016 I think we're going to Have that same thing come up again and That is where we likely hit that lowest Risk ban on on bitcoin total risk and We'll see whether it's a higher low a Double Bott or lower low obviously you Can make a case uh several different Ways but we'll talk about that if and When the time comes so I do expect us to Still Trend Trend to 10 trillion I think We need to hit that lower green Regression line first before really Before that will Happen uh and so yeah 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 thank you guys for tuning in I'll see you guys next time bye