What has Rolexes and luxury watches got to do with falling crypto prices?

Was never a watch guy, but I have to admit some of the time pieces are remarkable work of engineering and artistry!

Luxury watches and crypto prices.

Supply and demand.

Interesting dynamics.

When crypto was booming and coin prices were sky-high, people were making money.

More millionaires were minted and with new wealth, they sought to buy the finer things in life.

Not surprisingly, luxury watches were prime targets.

Over the last few years, when cryptocurrencies were booming during the bull run, prices of luxury watches like Rolexes and Patek Philippes were also climbing to ridiculous levels.

Iconic designs like the Rolex “Hulk” nearly doubled in price at its all-time high around last year.

“According to the Federation of the Swiss Watch Industry, the market has more than doubled in size over the last two decades, up from CHF10.297 billion in 2000 to a staggering CHF22.302 billion in 2021.”

Could be due to the influx of rich Chinese buyers, general year-on-year increase in popularity of the watches and also people wanted to divest some of that crypto profits they made.

Can you guess why the Hulk, a pretty sought after Rolex, is named as such?

But with the boom, comes the bust.

Market cycles are called cycles for a reason: what goes up must come down.

Seems like a price correction is settling in.

“Indeed, there are more than 87,000 Rolex watches available right now at watch-selling platform Chrono24, which told Bloomberg that supply of watches like Rolex is currently “much larger” than in years past.”

Chrono24 is one of the largest dedicated second-hand watch retailers and marketplaces in the world, currently holding more than half a million timepieces on its website.

More supply means prices will inevitably fall.

At current rates, most Rolexes are going for 25% less than their peak.

The markets are correcting themselves after all.

Maybe people need to sell their watches to get cash to backstop their losses or pay back loans they made?

Maybe crypto wiped out their investments and savings, and they need the cash for living expenses?

What does this tell me?

Ultra luxury brands like LV made a killing during the pandemic and still held well despite the economic downturn.

Start a business in the luxury line during the bull market, targeting the ones who made their money from the boom, and stockpile cash.

And when its the bear market and prices have slump, use the cash to buy up all the supply for cheap.

Wait for the next bull run and sell for massive profits.

Rinse and repeat.

Welcome to the 3 comma club!

I wish it was that simple.

Anyways, for those who have been priced out of action for a new Rolex or Omega, now might be the time to start swooping in for some good buys.

Desperate times calls for desperate measures, and sellers might let their watches go for some quick cash.

Anyways, are luxury watches like Rolex and Pateks a good asset to invest in long term?

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Is Rolex a good long term investment?

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