Mark Connors

Leveraging 35 years as a portfolio and risk manager to share the Macro Case for Bitcoin & Why the Alpha is in the Beta with bitcoin. Co Host: @thenewbarbpod

[Mark Connors @riskdimensions]

First big purchase of the year and I couldn’t ask for a better start. Been grinding in crypto and it’s finally paying off just picked up a brand-new Cadillac Escalade SUV. Big thanks to @cc__Melissa for the guidance…

[Mark Connors @riskdimensions]

Proper analogy @EricBalchunas when the toddler acts up, give it a timeout for the age appropriate behavior. Don’t discard it.

Wait,

It will mature, provide value.

Be worth the wait.

Patience of a parent.

[Eric Balchunas @EricBalchunas]

The Tortoise and the Hare: Store of Value edition.. love this chart of $GLD vs Bitcoin for past three years have the exactly same 39% ann return but two VERY dif routes there. One's a teenager and the other is 5,000 years old and they act like it.

[Mark Connors @riskdimensions]

Some Truth Dropped here.

Derivatives volume is multiples more than spot Bitcoin.

That sets price often, not always and certainly not over the long run.

[@ElmundoCrypto @elmundo_hzi]

Gold-Markt als Parallele:
• Das LBMA-Papier-Gold-Volumen übersteigt das physische Gold-Volumen um den Faktor 100+
• Trotzdem ist Gold von ~$1.200 (2018) auf über ~$2.900 (2025) gestiegen
• Warum? Weil physische Nachfrage (Zentralbanken, ETFs) letztlich den Boden setzt und Papier-Shorts bei Knappheit liquidiert werden
Bitcoin-spezifisch:
• Januar 2024 – Spot ETF Launch: Trotz Futures-Dominanz trieb die Spot-Nachfrage durch BlackRock/Fidelity den Preis von ~$42K auf $73K. Das widerlegt direkt die These, dass Spot-Käufe "egal" sind.
__________________________________________________
Fazit
Der Post identifiziert ein reales strukturelles Phänomen (Derivate-Dominanz), zieht daraus aber zu absolute Schlüsse. Die Wahrheit liegt in der Mitte: Futures dominieren die kurzfristige Preisfindung, aber Spot-Angebot/Nachfrage setzt die langfristigen Grenzen. Die These "Reserven sind komplett egal" ist durch den ETF-Effekt 2024 empirisch widerlegt.

[Mark Connors @riskdimensions]

If you want to know what happens when money becomes meaningless.

Look at the $600k wagered below.

God knows it’s not a good use of money.

[Polymarket @Polymarket]

BREAKING: The odds of Jesus Christ returning this year have doubled overnight.

4% chance.

[Mark Connors @riskdimensions]

Some mindset/ body aware gold dropped by @bradmillscan

Hit the gym.

Talk to friends.

The thesis is playing out the price is not.

Great stuff Brad

[Brad Mills 🔑⚡️ @bradmillscan]

Have you noticed a major shift in your mood and behavior since the Bitcoin price crashed a few days ago?

Over the last 2 years I’ve gone on a journey to build a citadel mind and body to be able to handle the 10X problems that will come with a Bitcoin 10X.

Even after all the work I’ve done in myself, I’ve gone into fight/flight/freeze.

I got into an argument with my wife which I normally would have navigated with my new relationship tools.

Here’s what I noticed, maybe you felt similar…

Body Signs:
-Chest tightness
-Elevated respiratory rate (WHOOP)
-Traps/chest guarding
-Extremely tight shoulders
-Sighing & deep uncomfortable breaths

Freeze:
-Low motivation
-“Stuck” feeling
-Narrowed perspective (focusing on gaps rather than gains)

Flight:
-Doomscrolling Epstein posts
-Avoiding conversations
-Wanting distraction, junk food, vegging out

Fight:
-Irritability
-Overreacting to wife & daughter
-Agitation

I started to think “is this Depression?” … but when I described everything to ChatGPT, it started making sense.

I realized that this is not depression or a mindset failure, it’s a nervous system response to the threat of a Bitcoin price crash.

If you’ve been “all in” on Bitcoin for a long time, you physiologically associate Bitcoin with safety, sovereignty, future security, identity, purpose, competence, etc.

The longer you’re in Bitcoin and hold through long deep drawdowns, you develop psychological anchor to price.

Price goes up = safety
Price goes down = threat

financial trauma is real.

When bitcoin is at the top of your identity stack and your financial life is tied to it over years (15 years for me) price drops like this will activate your sympathetic nervous system.

All of these physiological responses are a conditioning response.

GPT calls it “acute nervous-system dysregulation” triggered by a know cue.

In the last couple of years I’ve identified activities that help me regulate these feels and reduce price induced back pain:

-Exercise (gym/lifting)
-Massage
-Disconnection from news/macro/politics
-No social media debating
-No scrolling social media/twitter
-Fill my mind with positive inputs & healthy mindset routines

When the price crashed I re-exposed myself.

I went on Twitter and started scrolling (Epstein files made it worse) & listening to Twitter spaces.

My system said “oh we’re back here…”

My old pathways relit…the old responses came back.

The difference now is I caught myself early. I used AI to help me figure out what is going on with me and I didn’t spiral for days or weeks.

Now that I know what’s happening, the work is to decouple identity/safety from price.

My body is doing exactly what it learned to do under prolonged financial intensity of previous cycles.

If you’re feeling this way too, I hope this helped!

ChatGPT suggests somatic therapy, EMDR or brainspotting.

“Even when the number drops, I am still safe.”

I apologized my my wife, took responsibility for my over-reaction and we both went to the gym and have changed our day around.

My mindset coach @danmartell says “you can start a diet half way through a bag of chips.”

He also says don’t let a bad morning turn into a bad day.

Your mind understands Bitcoin volatility, your body does not.

My next step is to break to reflex of price drop > body panic to remove the flooding component.

Do this work and you won’t need to “sell to the sleeping point.”

My goal is to HODL through hellfire and stay at my baseline & still be able to show up and stay consistent.

[Mark Connors @riskdimensions]

Excellent take by @david_eng_mba

Clear, compelling and clinical.

[David @david_eng_mba]

The One Number That Explains Bitcoin’s Price

The number is −0.65.

That’s Bitcoin’s Z-score.

If you’re not a statistician, here’s all that means:
a Z-score tells you how far price is stretched from what’s normal.

• Z = 0 → price is normal
• Z > 0 → price is stretched high
• Z < 0 → price is stretched low

It doesn’t predict hype.
It measures tension.

Here’s why −0.65 matters.

At this point after every prior halving, Bitcoin was above trend:
2012: +1.02
2016: +1.32
2020: +0.48

Today: −0.65
That has never happened before.

Not once in 15 years.

What the numbers say next

I ran the full dataset: 5,681 daily observations.

Every crash. Every bubble. Every macro regime.

The relationship between Z-score and future price is not weak.

Correlation to forward 18-month returns: −0.745
Variance explained by this single variable: ~56%

That means how far price is stretched explains more of what happens next than rates, CPI, narratives, or sentiment.

From Z ≤ −0.6 (where we are now):
• 12-month win rate: 100%
• Negative outcomes: 0
• Worst case: +47%
• Median outcome: +181%

From Z ≥ +1.0:

• Win rate: 44%
• Worst drawdown: −73%

That’s not opinion.
That’s asymmetry.

So why doesn’t price “feel” bullish?
Because Bitcoin is no longer being priced like a trade.

It’s being used.

Bitcoin now trades 24/7, settles instantly, and can be pledged as collateral. Capital can move through it without anyone smashing the buy button on an exchange.

That suppresses price temporarily.

It does not weaken demand.

The market calls that “no interest.”
The math calls it misclassification.

Meanwhile, supply math tightened permanently.

Issuance was cut in half in 2024.
ETFs absorb hundreds of BTC per day off-exchange.
Institutions accumulate quietly.

Selling exists but it’s being transferred from short-term holders to long-term balance sheets at roughly a 36% discount to network value.

That’s not distribution.
That’s inventory changing hands.

Mean reversion doesn’t need a catalyst.
Deviation half-life: ~133 days.

That means:
• ~50% of the gap closes in ~4 months
• ~75% in ~8 months
• ~90% in ~12 months

No optimism required.
No narrative required.

Time does the work.
This isn’t a trade.

It’s a position.

The bet isn’t that “Bitcoin moons.”
The bet is that math didn’t stop working this cycle.

Because when highly stretched systems snap back, they don’t negotiate.

They just move.

Macro does not determine Bitcoin’s long-term price.

Distance from equilibrium does.

[Mark Connors @riskdimensions]

This next period is about punching through to a new world order - one that requires funding to absorb the economic slack from AI and regionalization.

His hand will be forced to accommodate.

End

[Mark Connors @riskdimensions]

@StockSavvyShay following up on my previous.

Warsh is the most Hawkish pick, no doubt.

But Warsh’s comments were in a period of over stimulation by Powell.

1/2

these comments

[Shay Boloor @StockSavvyShay]

If you’re wondering why asset prices are getting hit like gold down over 10% and silver down more than 30% in a day then listen to this Kevin Warsh clip.

He’s openly critical of QE and favors a tighter Fed balance sheet which means less liquidity across markets.

[Mark Connors @riskdimensions]

Yes. He does.

But the seat and circumstances will dictate accommodation.

If not the Fed, the. The banks will be able to warehouse bills without the restraint of the dreaded Supplementary leverage ratio (SLR)

Gravity does not care about one’s opinion or plan.

It just is.

[Shay Boloor @StockSavvyShay]

If you’re wondering why asset prices are getting hit like gold down over 10% and silver down more than 30% in a day then listen to this Kevin Warsh clip.

He’s openly critical of QE and favors a tighter Fed balance sheet which means less liquidity across markets.

[Mark Connors @riskdimensions]

Nice work @sminston_with

Worth a read.

[Sminston With 👁 @sminston_with]

https://t.co/7yYeBODEas

[Mark Connors @riskdimensions]

So keeping with the 7 wet diaper model, the immune system needs support / upgrades to keep healthy for sure.

For Bitcoin, timely, supportive upgrades are like mother’s milk for the changing needs of the baby/ network.

End

[Mark Connors @riskdimensions]

Will give a listen @billbar yes quantum a hard to define attack vector.

I’ve shared my thoughts on X and agree that what works today may not work tomorrow.

1/2

[Bill Barhydt @billbar]

@riskdimensions Yes I agree with your analysis except for the quantum argument.

See my similar macro comments I mad this morning below.

Enjoyed your comments on crypto town hall.

https://t.co/HYDRnrbu4a

[Mark Connors @riskdimensions]

Very important @EricBalchunas one time I forgot to tell the other team’s coach their best player had 4 fouls.

Rule #3 behind matching player name an number and comparing books with the visiting team’s book keeper at half.

The 5th came soon after.

We won.

Left that basement gym quickly.

[Eric Balchunas @EricBalchunas]

From Devon Prep in Valley Forge to Shissler Rec Center in Fishtown for second half of tonight’s bball double header. I’m keeping the scorebook. Very imp job.

[Mark Connors @riskdimensions]

Trust but verify @GaryCardone

You never know what's going to stick in @Crypto_TownHall.

For the record, we are talking wet diapers, as soiled diapers are produced by shit coins.

And yes, if you get seven wet diapers a day in those early days, your baby / system is getting the proper intake.

Trust the system but verify. Thanks for the shout out
@GaryCardone

At $82k, it looks like our baby is languishing, but she is wetting the network with blocks every 10 minutes as the old system chokes on low nutrition fiat.

Sleepless nights are a price to pay until maturity takes hold.

HODL on Team.

[Mark Connors @riskdimensions]

You never know what's going to stick in Crypto Town Hall.

For the record, we are talking wet diapers, as soiled diapers are for shit coins.

And yes, if you get seven wet diapers a day, your system/ baby is getting the proper intake.

Trust the system but verify.

Thanks for the shout out @GaryCardone et al.

at $82k, it looks like our baby is languishing, but she is wetting the network with blocks every 10 minutes as the old system chokes on low nutrition fiat.

Sleepless nights are a price to pay until maturity takes hold.

HODL on Team.

[Gary Cardone @GaryCardone]

@riskdimensions develops new model for Bitcoin.

Named the 7 Diaper Bitcoin Model challenges the Power Law Model and Plan B's Model.

This model suggest that Bitcoin is bottoming.

Are you a poopey bitcoiner or a stacker / packer?

@daveweisberger @scottmelker @brucefenton @GrantCardone

[Mark Connors @riskdimensions]

valid to some degree,

BUT IMO, overstated, priced in for the most part and presented in a skewed manner that unduly maligns the bitcoin value prop vs other assets/ protocols in a post quantum world.

End

[Mark Connors @riskdimensions]

This is what the 5Y price chart looks like for silver.

A thread on dislocation and regime shift…

NOT ‘rupture’ as Canadian PM Carney offered last week.

1/n

[Mark Connors @riskdimensions]

Yes, we think Bitcoin will follow these familiar non dollar assets in due time, as seen in Q3 2020.

The standard lag of Bitcoin v gold is today compounded by quantum computing concerns.

Concerns that are

4/n