Some more expanded Bitcoin thoughts on current market structure, what's the sensible trade to take and so on.
Yesterday we saw the worst day since FTX collapsed. Price being down 14.04% puts this as the 5th worst day after FTX, 2021 China ban, Celsius/3AC collapse and Covid.
One thing which I guess a lot of people are expecting on a day like yesterday is more capitulation in the perps market, which I personally don't think is really necessary considering how much leverage and open interest got wiped out on 10/10. The slightly more muted reaction (no massive liquidations, funding at baseline) is not that surprising in the current market conditions I guess.
Where the blow-off happened though is in options where level of backwardation in term structure and put premium equals the FTX crash levels panic.
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I believe that the permanent underclass is a myth perpetuated by people who want to instill fear and bad vibes into your psyche.
Yes inequality has undeniably grown ever since WW1 and WW2 and the financial infrastructure of the world only seeks to perpetuate that.
But chances are if you stay off drugs, have a steady income, and remain curious and inquisitive of the world, you will be fine.
People that tell you you have x years until you're in the "permanent underclass" are almost always trying to sell you something.
You’re not lucky.
You studied.
You cut unnecessary spending.
You learned how to invest.
You took bold risks.
You bought crypto when few believed.
You ignored the mockery.
You survived the bear markets.
You didn’t fall for the traps.
Now you’re reaping the rewards.
Luck had nothing to do with it.
Catching up on some tradfi Christmas stories where people gave millions of dollars to someone who martingales 0DTE iron condors (???).
It should serve as a friendly reminder that there's no edge in understanding options or trading cool structures with cool names. Also, selling 0DTE options or running all these "income" strategies is extremely risky and dumb for the most part.
I could probably spin this into a thread about how gamma risk evolves in relation to zomma, color, and speed, but the only useful takeaway from anyone telling you such things is that they haven't felt the touch of a woman in a long time, instead of being applicable for actual trading.