#47: Reality Check w/ Terrence “Atrocious Adoption” Yang
Listen now to Episode 48, part 2 where Amy Wan is grounding and everyone else is making panic and sharing fear.
Great Gestation Part 2: Ep. 48 of Coloring Crypto
Summer 2018 in Crypto, Part 2 @ [22:30]
Terrence Yang of Yang Ventures has been investing and advising in crypto since 2014. We interviewed him as part of the Great Gestation series.
The FOMO has turned to fear. Fear of missing out has become fear.
G Colors: If you think back to when we last talked about 3–4 months ago, what’s your take on what you thought would happen versus what’s happening now?
Terrence Yang: It’s within the realm of possibility of what I had predicted — I’ve been through a lot of bubbles before having worked on Wall Street. The benefit of working on the trading floor and Wall Street, is you see many many bubbles and financial crises. When I was at Morgan Stanley, we would trade with everybody around the world and there are constant blow-ups.
Economies suffering from hyper-inflation and currency devaluation are not using Bitcoin right now.
Terrence Yang: What people in crypto don’t get is — when Bitcoin goes from $800 in January 2017 to $20,000 in December 2018, that is a massive bubble.
There was no real adoption.
I didn’t know if we would go from 20,000 to 100,000. But, it was inevitable that it would not be sustained because there is no real adoption. Bitcoin is not being used in Iran by people who need it, instead they’re using gold and US dollars. The crypto usage is atrocious.
The whales can manipulate the prices again but it’s harder now because people realize the emperor has no clothes.
The price is crashing because there’s no adoption. We’ve had ten years of money printing inflation at 3% . The FED is raising rates. There is very low risk of the US dollar having currency devaluation unlike other economies like China, Brazil, Argentina, Venezuela, right? The only people who buy and hold Bitcoin or paranoid people with imaginary problems.
I’m paranoid. I hold some Bitcoin because of this imaginary problem that someday we will have hyperinflation.
The only people who buy and hold Bitcoin are paranoid people with imaginary problems.
Look at adoption right now in Venezuela. What local Bitcoin volume would you expect per day? How many Bitcoins per day in Venezuela do you think are are being exchanged? Most would guess something like 10,000. The real number is 70.
The adoption is atrocious. The adoption is an F-minus.
The people who are suffering hyper inflation and currency devaluation right now are not buying Bitcoins.
Colors: What have you done with your personal holdings of Bitcoin, and what should we do?
Terrence Yang: I hold a number of alt-coins. I dumped Bitcoin around 9,000. But, I’m just going to keep buying. I’ll be buying and just dollar-cost averaging.
Let’s say you never got into Bitcoin because it’s too expensive when it was $20,000. You were right. So now that it’s falling, do you know when to buy exactly? Where’s the bottom? We don’t know because it’s heavily manipulated.
But while it’s going down, why not buy a little bit and every time you can keep it very simple. You don’t need to do this technical allowances BS that doesn’t even work, just every time it hits top five hundred dollars just by a little bit.
People at home who believe in Bitcoin long-term: just buy ten dollars a month. Every month, whatever the price, buy $10 of Bitcoin.
That’s a much better strategy than if you try to wait for the right time because the prices are manipulated. The whales can manipulate it again potentially. It’s harder now though because people realize the emperor has no clothes.
So now that it’s falling, do you know when to buy exactly? Where’s the bottom? We don’t know because it’s heavily manipulated.
Colors: Tell me a quick story of a personal exchange with someone in your family or group of friends, like somebody at a party you talked to who bought in in December and now they’re just like — this is all BS.
Terrence Yang: Okay, so there is someone and I’m afraid to ask them. There’s someone I run into regularly, and more importantly their mom, who is Main Street. And you know, when I run into them I don’t even bother asking how their mom’s doing because I don’t want to know all the problems.
On the positive side though, I have had no more Uber drivers or Lyft drivers ask me what Crypto is the next Ethereum or Bitcoin.
A good friend of mine who runs a VC who lives in LA, he dumped everything when Bitcoin was at its all time heights. I asked how he timed it so well. His answer: Friends who were Hollywood producers, or were just very successful people in Hollywood, who knew nothing about finance, cryptography, or computer science were talking to him about Bitcoin and ico’s and stuff at their children’s birthday parties — and he was like, this is ridiculous.
So he just sold everything.
I have had no more Uber drivers or Lyft drivers ask me what Crypto is the next Ethereum or Bitcoin.
Colors: What is the best best resource you can share that can help people separate the signal from the noice?
Terrence Yang: I highly recommend everybody get out of their own bubble. We all live in bubbles and have filters and have biases because of the people we are naturally surrounded by. This includes our co-workers, our family, our friends — the people who agree with us on social media — I follow people who disagree with me, but I respect them because they are very very smart and they back up what they say.
I like Nick Carter from Castle Island Ventures https://medium.com/@nic__carter
Colors: Thank you for being a guest on Coloring Crypto and claiming the cynical reality check perspective for the Great Gestation episode!
Terrence Yang: Ha ha ha
