Late last year I announced to much consternation my desire to liquidate my entire ETH position, which I started in late 2019 in the $100s. The response from mostly everyone who commented was “enjoy staying poor.” The reason why I waited for 2022 was to avoid a tax gain for 2021. This turned out to be a disastrous idea and my strategy to sell in 12 parts, once per month, over the course of 2022 has resulted in LESS THAN IDEAL exit points.
Nevertheless, it is what it is and I will not deviate from my plan.
Folks often ask me my opinion about ETH, as if I knew anything at all about the future pricing of the crypto. I haven’t the slightest idea.
But what I can tell you is this recent downturn has illuminated certain truths about BTC-ETH. For one, it is not an inflation hedge. For two, it trades in lockstep with other risk assets. In other words, there isn’t a negative correlation feature to the sector, unless of course you take seriously the dollar/BTC cross. If you do, then the dollar’s rise is certainly something that might’ve hurt cryptos, although I seriously doubt any of the incels in the crypto community truly view it as an alternative store of value.
It is a risk asset. Markets have been up as of late, so naturally ETH is leading the way — higher by 38% in the past month.
If you are bullish on stocks, own ETH. If you think stocks are heading lower, do not own it.
As for me, I am bearish, but have been known to be wrong on macro calls, so I will stick with my once per month liquidations until the entirety of my position is gone.
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The VIX has fallen 16% this week alone. If it gets under 20, where it appears to be headed, the insanity (exuberance in the face of significant rate raising) will be dragged out a lot further.