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Episode #84: 🐮 The Bulls Are Back In Town

Did Libra pump Bitcoin? We go inside the bull run to nearly $14,000 and the subsequent 20% freefall.

CoinTalk™️ is produced in partnership with Medium and hosted by Aaron Lammer and Jay Caspian Kang. Press “Listen to the story” above to play the episode. (You can also subscribe on Apple Podcasts, Google Play, download the MP3, or email us at

Show Notes

♎️ You can’t talk about Libra without talking about Bitcoin

💹 Price manipulation is back, baby!

🛴 Why all the exchanges are rooting for altcoins


Aaron Lammer: Oh, man. Quite a week. Maybe one of the most eventful weeks between shows in recent memory.

Jay Kang: You mean like on a personal basis or in the Bitcoin world?

Aaron Lammer: No, I mean in the Libra Bitcoin world.

Jay Kang: What happened in Libra?

Aaron Lammer: Well I think people are pretty resoundingly saying, you can correct me if I am wrong, but if you were to say, “What’s the word on the street on what caused this Bitcoin mega rally?” I feel like Libra is getting quite a bit of the credit.

Jay Kang: Okay, I seen that too and I seen it in the context of people, not just on Twitter, but it’s the same thing that keeps happening all the time. It happened last bull run too, which is that anytime there is a massive swing in price, which we definitely have had, people just point around. I think they do a Google search or something like that, or they search on Twitter for Bitcoin, and then they see the first six things that come up. Then they just pick one to be the reason. Do you know what I mean? It just feels so random.

Aaron Lammer: Wait a minute, wait a minute. I think they’re right here.

Jay Kang: Okay, no, no. But this is what I mean. I am generally very, very skeptical of it, or this type of explanation. But you seem excited by this and so I want to hear what your take is. Why are these two related?

Aaron Lammer: Well okay, so overall I think what we should do in this show is I want to talk about the bull run, and I also want to talk about our hit Libra coverage, and how we got almost everything right and influenced the entire space. But I think we got a few things wrong also. I want to talk about one weekend what Libra did and did not do, but I think that you cannot talk about Libra without talking about Bitcoin. We haven’t really seen Bitcoin on the CNBCs, the MSNBCs. All of the cable offerings are back to mentioning Bitcoin in their programming. I think that moves the needle.

Jay Kang: I don’t think I agree. How much was Libra actually discussed outside of the people that we know who are the peak Libra discussers? Why would Facebook being like, “Hey, in a couple years you can buy this cool coin. It’s like Bitcoin but better”? Why would that spur people to be like, “Oh yeah, let me buy this thing that’s really expensive and might not work that well. It’s going to be obsolete.” I don’t quite get the psychology there, but I’m not ruling it out just because they did coincide and a lot of people just seem to be thinking that. Are there other reasons that you think they might be coincided?

Aaron Lammer: Well regardless of who you think is number one and who you think is number two, when a increased valuation for Uber comes out, it lifts Lyft, right? There’s a certain amount of just, “Oh, you’re my competitor. Well, that’s make more valuable.”

Aaron Lammer: I do think that the overall crypto space has gotten some validation from Facebook. Crypto is niche, and it’s not like it needs to be the number one trending news item to move the market. Even during Bitcoin mania, it’s not like it was really that much mainstream news. I think anything helps. I just feel like there’s a steady uptick in I’m hearing more about Bitcoin. Yes, there’s some big gains, which is basically what the news like to talks about. There’s a reason this is going in these massive seesaws, and part of it is these hype and then bust cycles in how people perceive Bitcoin.

Jay Kang: I just don’t buy any of that stuff.

Aaron Lammer: What do you think caused it?

Jay Kang: This has been our fundamental disagreement throughout the course of the show. There have been moments where I’ve slipped from this and I’ve regretted it every single time, but I don’t know, I just find it hard to believe that the price of Bitcoin would go up 100% just because Libra was in the news. I’m not saying that you’re saying that it’s 100% correlative effect either, a causative effect, and that other factors can play into it. Until proven otherwise, I will just always assume that these mass movements, not slow movements but these big, big movements that they’re mostly price manipulation based and people are trying to play the market in some sort of way.

Aaron Lammer: I’m not even sure some of these things are mutually exclusive.

Jay Kang: No, I don’t think so either.

Aaron Lammer: I see Bitcoin as a powder keg, that there is a market manipulation urge to set off, or to first shake up and then set off at the right moment.

Aaron Lammer: I think some of these momentum swings are a little bit opportunistic trading around certain news events and certain just random correlations, such as there is a having coming in 2020, I believe. There’s all these different clocks that are ticking that are affecting Bitcoin price, and people, I think, probably have more information than you and I, and are trading around that effectively, and are looking at when the right time to set off a run is.

Jay Kang: You also think it’s just an illuminati of giant bagholders who are doing all this?

Aaron Lammer: I don’t know if is it giant bagholders. I think our good friend, Ledger Status, will just say that’s market stuff. Whether you call it manipulation or a lot of times they’ll be like, “That’s not market manipulation, that’s how trading works.”

Jay Kang: No, I agree. I agree with that. Yeah.

Aaron Lammer: Bitcoin is a little bit like all the other things you have in the market, but a little bit on steroids, a little bit unregulated and a little bit brave new train.

Jay Kang: Completely on steroids and completely unregulated.

Aaron Lammer: Yeah, so you’re seeing things that markets do, but you’re seeing them bigger, and bolder, and dumber, and crazier. That’s why I don’t discount a Libra playing a part.

Aaron Lammer: I will say this, among takes, I know you and I are both connoisseurs of the take. I was expecting the Bitcoin R.I.P., it’s all about Libra now take. Did not see that take.

Jay Kang: Yeah, I didn’t see it once. I think that it’s because … I actually did see some people saying that, but they aren’t people who are knowledgeable about it. I just think that if you look at this stuff in good faith, and I would say that the majority of people who work in the Bitcoin journalism space, not like Bitcoin journalists, but people who are journalists who are interested in Bitcoin or write about crypto, they are generally fair-minded people regardless of what some of the coiners say, or some of maximalists say.

Jay Kang: There’s just no way that you can look at it objectively and just be like, “Oh, these two things completely overlap.” Like we said in a earlier case, I think the very base reading of it is just like, “Oh, this is a great use case for Bitcoin, Libra is. Libra is the reason why you need Bitcoin.” I don’t know. I just don’t understand how you could come up with a sense that Bitcoin is over from this. What would even the argument be?

Aaron Lammer: Well I think that the funny thing that happened around Libra is the my enemy’s enemy is my friend issues that come up, where it’s so much of the journalism take world is just ready to dump on Bitcoin. Yet everyone agrees that Libra is almost the opposite of Bitcoin, or it’s all of the important parts of Bitcoin ignored. You would think that therefore people would have a positive take on Libra, but no one’s going to come out with the super positive, pro-Facebook Libra take, so it weirdly puts people in the position of I think giving Bitcoin some credit because they’re like, “Well, at least Bitcoin’s not totally cynical like this Libra thing.”

Jay Kang: Yeah, or they’re not as afraid of Bitcoin as they are of Libra.

Aaron Lammer: I think so. Yeah.

Jay Kang: We’re going to talk about this soon, but I do think that Bitcoin almost feels like the scrappy underdog now, whereas before it was just the weird cousin you have and nobody really wants to talk to her because he always says something horrible that makes you embarrassed. But now there’s someone who’s standing next to him who you’re actually afraid of. So they’re like, “Oh, I can just tolerate his quirks.” That’s what it feels like to me, at least.

Aaron Lammer: In framing Bitcoin, not as a currency but as a protocol, this would situate this as an email versus Facebook Messenger war. I think that framing is inherently friendly to Bitcoin, thinking of Bitcoin as the open-source alternative to a Facebook mega service is a very nice and flattering way to look at Bitcoin.

Aaron Lammer: I think generally people think of Bitcoin as part of this technological cartel, mafia, Silicon Valley that’s taking over the world, but if Bitcoin can frame itself as an alternative to that stuff, that’s I think where people start rooting for Bitcoin again. Am I crazy?

Jay Kang: No, no, no, no. That makes sense to me too. If Bitcoin’s messaging is smart, they’ll play into that, not that there is a central messenger of Bitcoin.

Aaron Lammer: Well there’s no central messenger of email either. It’s not like someone evangelized for email.

Jay Kang: As Libra becomes bigger and bigger, and more and more eminent, the Bitcoin maximalists would do well to paint a very stark apocalyptical world that Libra could bring about, and paint themselves as the alternative to that. I see that some of them are doing that already. I don’t think it’ll be that particularly hard.

Aaron Lammer: Well last week, we had talked about the almost instantaneous French governmental opposition to Libra. That spread pretty quickly to America. I think Kamala Harris was the person who first brought it up. I could be wrong about that.

Jay Kang: She did. Yeah, yeah. Because we were betting on Warren. We thought that Warren would be the first one to like …

Aaron Lammer: Well did you watch the Democratic debate?

Jay Kang: Yeah. Of course, yeah. I watched it. I watched the whole thing.

Aaron Lammer: Okay, so across all of these debates, we’re going to get at least one Bitcoin question, right?

Jay Kang: No. No.

Aaron Lammer: No?

Jay Kang: There’s no way.

Aaron Lammer: It’s a lot of debates.

Jay Kang: There’s now way.

Aaron Lammer: There’s 20 people debating.

Jay Kang: There’s no way.

Aaron Lammer: You don’t think anyone’s going to throw Yang a Bitcoin question?

Jay Kang: Absolutely not.

Aaron Lammer: [inaudible 00:11:40] open from the audience ones?

Jay Kang: No.

Aaron Lammer: Can we get odds on this? Would you give me 10/1 on whether a Bitcoin question gets asked?

Jay Kang: I will give you 5/1. If a Bitcoin question is asked at one of the debates, not at a town hall for an individual candidate, but at a debate in the next year and a half, or however long. Yeah, I will give you …

Aaron Lammer: You’ll give me 5/1?

Jay Kang: I’ll give you 5/1.

Aaron Lammer: Okay, I’ll think about that. I’m going to consider that. You settle in Ripple. Is that correct?

Jay Kang: Yeah, my five Ripple to your one Ripple.

Aaron Lammer: Okay, so you would pay me five Ripple. But if no one gets asked, I have to pay you one Ripple.

Jay Kang: You would pay me one Ripple.

Aaron Lammer: We have to assume that Ripple’s going to be worth what? Around $200 to $300 by the time of the election?

Jay Kang: Yeah, 240 somewhere.

Aaron Lammer: Okay, let’s call it 250. Okay, so we’re putting … Basically I pay you 250 versus I could win 1250. I don’t know, it really depends how deep Yang goes. I think if Yang goes deep, we’re going to hear some Bitcoin talk in the Democratic primary.

Jay Kang: Is he even the most Bitcoin friendly of candidates at this point?

Aaron Lammer: I think he has got the most Bitcoin tilted [inaudible 00:12:45].

Jay Kang: No, that’s no question. There’s no question about that. I don’t know if he actually cares about Bitcoin. I just think that his fans do.

Aaron Lammer: They don’t ask you a question based on the question you want, they ask you a question based on making you uncomfortable.

Jay Kang: That’s true, and he is the only one I think, to date, who has spoken at a crypto event.

Aaron Lammer: With our good friend, Neeraj.

Aaron Lammer: When Kamala Harris brought up Libra, very first statement about it, she mentions you can’t just set up shop in Switzerland like this, and use a Swiss bank or whatever. This is something I had an inkling of that this whole crypto, we’re just incorporating as a weird foundation in Switzerland, is not going to go over well with American regulators.

Jay Kang: Okay. But what can the U.S. government do to stop them? Is there any way they could stop them outside of just being like, “Hey, you shouldn’t have done that naughty Mark Zuckerberg”? What can they actually do?

Aaron Lammer: I don’t think they can do much to stop them other than to point out that an American company is registering weird foundations in Switzerland to an advance a printing their own money agenda. I think all they can really do is add it to their litany of complaints against Facebook. But it basically feels to me like we’re not accepting the dodge that this is just open-source software. It’s not even really a Facebook thing. It’s a whole consortium of Visa, Mastercard and other publicly traded companies. It’s like, “Yo, you guys. It’s on your tab. You started a currency.”

Aaron Lammer: The paternity of this product is Mark Zuckerberg’s and people are not going to accept another news feed where it’s like, “Oops, we created a monster in our lab. But what could we do? We’re not even in control of it anymore.” People are going to blame whatever happens with Libra on Facebook and also probably whatever successes Libra have are going to mostly land in Facebook’s lap. This is a Facebook product regardless of where in Switzerland it’s registered.

Jay Kang: I agree with you. I just don’t know what the government could do outside of banning Libra, use of Libra in the United States. Something like that they could probably do but I don’t think it’s illegal to go and start a foundation if you’ve completely separate yourself from what that foundation is doing.

Jay Kang: Now that might be the path that they take. They might just say, “Look, you can have absolutely no interaction in this way. You can’t take money out of it.” There could be all these things that they do, but I don’t think that any of it will ultimately matter to Facebook because it’s not like Facebook is trying to make 1% off every transaction on this or something like that. What Facebook wants is massive hegemonic economic and political power. They’ll have that as long as Libra works. It doesn’t really matter how directly connected it is to Facebook.

Aaron Lammer: I caught one thing in the White Paper that some flag that’s buried in the fine print that I think is pretty indicative of the vision. This is from the White Paper, “An additional goal of the association is to develop and promote an open identity standard. We believe that decentralized and portable digital identity is a prerequisite to financial inclusion and competition.”

Aaron Lammer: Okay, so it’s basically like the whole idea of Facebook is being dissolved and being reconceived of as a blockchain open, hold your own keys concept, which I have to say, again I got to hand it to them, it’s pretty clever. It’s a clever play.

Jay Kang: Yeah, and it’s one that is a hedge for them in some ways. The biggest fear that Mark Zuckerberg, and Sheryl Sandberg and the people at Facebook have about crypto is what our friend Joe Weisenthal said to us a long time ago, which I still think about from time to time, which is that crypto in itself is a social network. If you build a social network on top of easy to use, encrypted secure transactions and you have more power than Facebook does because that’s actually how you interact with people online quite a bit.

Jay Kang: I imagine that this actually also serves to co-opt that a decentralized reality where people have a different relationship with online footprints and online identity. Yeah, maybe this was in that way a big hedge on Facebook’s part to make sure that the crypto decentralized world to just take all their shit, which I don’t know, in our most bullish over the past of years, I think both you can I could see a world in which that happened.

Aaron Lammer: Well I think again, almost all of the stuff is bullish for Bitcoin. If somehow Facebook does force a confrontation, which causes the U.S. government to ban or shut down Libra, Facebook’s number one quality, which is that it’s censorship resistant becomes glaringly important, it proves the difference between those currencies. Whereas if they just let Libra run free and Libra becomes this weird defacto decentralized identity thing, it makes it more legal to sell Bitcoin in America because you’ll probably be able to use your Libra identity.

Jay Kang: That’s such a stretch.

Aaron Lammer: Hey, I think it could happen. I think it could happen.

Jay Kang: That one feels a bit foreign to me, but I admire your bullishness.

Aaron Lammer: We said that if you are bullish on Libra, that you would buy Facebook stock. Facebook stock actually hasn’t reacted tremendously to this news.

Jay Kang: It went up 4% in that the day after it was announced.

Aaron Lammer: Yeah, but it’s flat. It hasn’t really caused any ripple.

Jay Kang: Yeah, but it’s a stock. It’s a multi-billion dollar company. You’re not talking about Sumokoin or something like that. That’s a huge move.

Aaron Lammer: Well no, no. Hear me out though. I guess what I’m thinking is, if Libra is making people think, “I’d like to hold some of my money in digital currencies,” you can’t buy Libra today. If you want to experiment at all in that arena and you’ve heard about Libra, you might be more inclined to check out Bitcoin now. This isn’t how I expected that they would roll it out. I was expecting that it would be like a Apple even where like, “Here’s the new iPhone and it’ll be out in six weeks. We’ll be taking pre-orders.” This long delay, I think, has brought interest into the space without anywhere new for the money to flow.

Jay Kang: I don’t know if I’d buy that [inaudible 00:19:51]. People are buying Bitcoin as practice Libras or something like that. I’m not sure if I … Does that …

Jay Kang: Here’s the part that I do buy of the explanation that you’re giving is that the more times the word Bitcoin or crypto are said, the more people will think about it. But I don’t know, do you think that the crash now that happened in the past day or so is because people are done talking about Libra?

Aaron Lammer: No, I think the crash was probably it shooting up a little higher than it could really hold, and some weird … There’s a Coinbase outage during which trading is frozen on Coinbase while it’s ramping up and then it dropped to $1700 while Coinbase is down. Once again, our longest running discussion of whenever actual volume returns, Coinbase is never actually ready to handle it.

Jay Kang: Yeah, yeah. They only had eight years to adjust. It’s ridiculous. They could add six new coins at the drop of a hat. Anytime there’s anything going on, they’ll just fritz out.

Aaron Lammer: We call it market manipulation, and I agree that that’s happening. But there’s also just a fair amount of chaos, it seems, during these big runs. We’ve now know that Bitcoin’s movements mostly are in these extremely compact runs. I feel like the meme of last time, it went from crossing 10,000 to going to 20,000 in what, like a week or something. People were primed to expect this crazy mania jump as it went over 10,000, and then like clockwork, the minute that started happening, crazy weird shit started happening on exchanges.

Jay Kang: Yeah. It doesn’t make sense to you that there is some threshold of volume and activity that fritzes them out? I just have a hard time to believe that number is anything close to a realistic number that’s out there, do you know what I mean? I bet there is, but I don’t think that it is in any way something that’s even physically possible given the size of the Bitcoin market right now. If it’s not, then there are ways to upgrade those types of things to make a system that is.

Jay Kang: Even at peak volume moments, at peak trading moments, the activity on a specific crypto exchange is really not that much compared to any other thing on the internet at that scale that involves that amount of money. I don’t know, I find these things very, very curious and upsetting. I’m willing to believe any conspiracy theory about them.

Aaron Lammer: Well it’s basically scared me off trying to actually trade. Any attempt you make to trade during one of these runs, which you would need to if you actually wanted to sell the top, it just seems impossible. All roads lead back to just hodling forever, because the whole system starts breaking down.

Aaron Lammer: No, I don’t think it’s technically that difficult. Although, if you were to ask me who could figure out this problem, I would definitely say that Facebook engineers would be good at figuring out this problem.

Jay Kang: Yeah. Like eBay for example, how many trades are being made every second on eBay compared to a high volume at a crypto exchange? I just don’t understand a world in which … It’s not like they’re moving around the crypto and the Bitcoin. They’re just changing ownership of it. It just doesn’t make any sense to me.

Aaron Lammer: I think you’re probably indicating something, which is that there is a certain amount of trading that is itself. Think of it less like eBay and think of it more like when there’s a sneaker drop, and there’s a ton of bots sending simultaneous requests that are all trying to cut each other in line, that’s the weird technical challenge. I think part of the reason that it’s difficult to run an exchange is that people are actively trying to screw with you to make money.

Jay Kang: I’m glad you brought up exchanges because I have a topic I wanted to ask you about.

Aaron Lammer: Shoot.

Jay Kang: Do you follow Binance on Twitter?

Aaron Lammer: I do, and CZ himself.

Jay Kang: Have you been noticing their new campaign, which is responding to this Bitcoin bull run, which obviously has wiped out all the alts, and they’re begging for an alt season? I found that a little bit weird, I got to say. The reason I found it weird is because they also are a exchange that offers Bitcoin.

Jay Kang: Now it’s obvious that an alt season is better for Binance because more people will buy more different coins, and they have all the alts, and that’s why you would use Binance instead of using Coinbase or Gemini. But how do you feel about a exchange rooting for a specific type of result publicly in this space? Try and imagine if E-Trade or Schwab was sending out tweets being like, “Let’s go uranium market,” or something like that. People would lose faith in them, right? How do you feel about it? Because I just found that a little strange. I’m not mad about it, obviously, but was just thinking, “That’s weird.” It highlighted how crypto is a little different.

Aaron Lammer: Yeah, it’s in terribly poor taste. The person who pioneered this is of course Brian Armstrong. Well Brian Armstrong publicly rooted against Bitcoin because it was against the interest of Coinbase and his personal fortune, which does better in a multi-coin environment. Ever since then, I feel like this is a precedent in the Supreme Court. People have been pretty comfortable rooting against Bitcoin in their own interest and Binance is a prime offender. They issue their own coin and it’s a top 10 coin. Of course Binance is not root for Bitcoin.

Aaron Lammer: Some of this stuff, I think they should have stayed on the sidelines, and been the dealer for whatever people were buying and not tried to play favorites so much, because I think they actually worked against their own interest by pushing the environment that has 20 different coins, some of which barely work and have to maintain them all forever. I think it’s actually a better business if everyone just gets buying Bitcoin and Ethereum, and bunkers down.

Aaron Lammer: Not it’s this mess where everyone wants to promote their own coin. Now Zuckerberg wants to promote his own coin. There’s no one who just wants to make Bitcoin work. You have a situation like this Coinbase situation where they’ve exactly what you said, they’ve put energy into adding shit coins instead of into shoring up their actual ability to trade Bitcoin during a run in which almost all of these shit coins are getting absolutely wrecked to Bitcoin.

Jay Kang: Yeah, okay. There is this take that I would say is okay, which would say that at least it’s transparent and you know what you’re getting into. As long as their messaging is out front, you won’t put your money into those exchanges unless you think they were looking out for your best interests. That is a take.

Jay Kang: But I think that what you said is right, in a sense that they were so far incentivized into their own interest that they created entire other economies inside the other economy, and they didn’t tell the customers that the new economies and the new coins were just absolute bullshit. That greed did lead to a lot of the loss of faith in crypto or a loss of trust in crypto.

Aaron Lammer: Would it be fair to call that the super airdrop economy?

Jay Kang: The super airdrop economy for sure. Binance is the kingdom of the super airdrop festivals.

Aaron Lammer: Well that’s how they got people off of their Bitcoin and to all these altcoins creating weird little discount altcoin markets where people could make a few bucks by selling off that coin into Bitcoin. Now those are actual markets for these coins that only really exist as airdrops.

Jay Kang: At the very beginning when we had Bitcoin, Ethereum and Litecoin, that was during the days when Coinbase Pro was GDAX and they didn’t charge fees. There is absolutely no reason outside of our own dumb trading to ever take our coins off of either that exchange or off of a hardware wallet. There’s no reason to send it to some place we didn’t know.

Jay Kang: You’re right, the only reason we got it out of that, very closed and somewhat secure ego system is because we wanted to by these stupid alts. You don’t put Bitcoin into Bittrex to hodl Bitcoin, you just do it to buy alts. Yeah.

Aaron Lammer: I think Coinbase damaged its brands to cater to each of these whims to, “You can earn ZRX by using your brain for one hour of Khan Academy lessons.” It’s just like, think how powerful Coinbase would be if it was just the prime Bitcoin dealer, or prime Bitcoin and Ethereum dealer. Why are they dealing with the [inaudible 00:29:04]? What’s the point?

Jay Kang: Well they had to do that because of … Didn’t they have to do that because some fork. I’m probably not the …

Aaron Lammer: This is what I’m talking about with the super airdrop economy. A fork, it’s an ideological airdrop. Basically Coinbase set its course on, “We’re going to support every one of those, we’re going to support BCH, we’re going to support ETC.” Quickly a couple exceptions becomes more than half of the coins you support. Now it’s this wide open ambiguous environment where it’s like, “Oh, it will be better for us if Ethereum Classic thrives.” It’s like, really? Is that really better for Coinbase’s core business if some fork shit coin thrives?” I stay focused.

Jay Kang: The thing they’ve lost, which I think is important, then we can move back to the bull run, the thing they lost was the purity of message, similar to how In-N-Out, you can only really order four things outside of the secret menu. But you go in there and you’re like, “It’s a double-double, or it’s a single,” whatever. Then a lot of their [inaudible 00:30:15] is from the fact that you feel like these are the only options that matter. If you go looking for anything else, it’s definitely a scam.

Jay Kang: Coinbase had that authority. They lost some of it when Charlie Lee basically scammed everyone in the Litecoin world. But only having those three choices was good for them. It also made it a lot easier for new people who came in to only have three choices. Now new people come see 14 different coins. Maybe they can only buy five of them, but they see the other nine and they’re confused by it. Everything seems more intimidating and scammy. I think they did lose something by losing that clarity of message.

Jay Kang: Now they might have gained it all back in additional fees from peoples’ trading shit coins, I don’t know, but I think they lost some messaging power at least.

Aaron Lammer: Under your analogy, Ethereum Classic is an off-menu In-N-Out item, like animal style?

Jay Kang: No, like the new … No, it’s more like Coinbase is Carl’s Jr. You know how you can order all sorts of weird shit at Carl’s Jr. You go into Carl’s Jr., there’s all these burgers that you don’t understand, like portobello, $6 something burger, and then some others sell fried chicken and shit. I think the new Coinbase is like a Carl’s Jr., or it used to be an In-N-Out.

Aaron Lammer: I got it. It got it.

Aaron Lammer: It’s a weird time to be talking because Bitcoin peaked above $13,000 yesterday.

Jay Kang: Yeah, it almost hit 14,000, right? Or like 13,300.

Aaron Lammer: Almost 14,000. Now down 20% again. But even with a 20% haircut, pretty amazing run. We’re talking 3X to 4X bounce off of the Kang Line. In a way, even without that additional 20%, Bitcoin did just go crazy. It just went in six months, 200% to 300% gains.

Jay Kang: Ooh, Bitcoin is crashing again right now.

Aaron Lammer: Yeah, yeah. Might have gone a little too high.

Jay Kang: It’s under 11,000 right now. Yes, it is crazy. Over the past three months or so it has gone about 400%. The fact that it went over 10,000, I was just so shocked because remember, we would talk about this all the time because that was your break-even point. You’re like, “If Bitcoin hits 10,000 again, then I’ll be somewhat even on everything.” I honestly just couldn’t see this happening again.

Aaron Lammer: Really?

Jay Kang: Yeah, I just didn’t think it would happen. I couldn’t figure out what combination of factors would have to be to get people this interested in it again, or to the point where this is happening. It’s just happening. Even though it went up to 13,500 and crashed back down to 10,000, I don’t think it’s going to go all the way back down. I think that that’s just a normal leg down, and that it’ll start climbing again pretty soon. What do you think?

Aaron Lammer: Yeah, this is the first time that I’ve heard people start talking about targets above 20,000. Before 10,000 was crossed, the goal was just to get back to where people didn’t feel like they lost their shirt. Now, particularly during the mania that was happening yesterday, I heard some $40,000 and $60,000 target commentary, which …

Jay Kang: From who?

Aaron Lammer: … is not investment advice, is not necessarily responsible, but it is the thinking we need to get above the all-time high.

Jay Kang: Yeah, other things that I think would indicate that the market is going crazy is that I bought the top.

Aaron Lammer: That’s just normal market stuff.

Jay Kang: I bought the top of Litecoin and Ethereum.

Aaron Lammer: Tell me what …

Jay Kang: An hour after was when everything crashed.

Aaron Lammer: Tell me what you were thinking about buying post-pump Litecoin was.

Jay Kang: A lot of it was laziness. I was on Coinbase Pro. Litecoin has been going really weird, and I just thought that there would be one possible pump in there.

Jay Kang: Then with Ethereum, I just wanted to get some Ethereum exposure I guess, and I didn’t want to get Bitcoin. I made all the same fucking mistakes that I always made, when you’re just like, “Oh, Bitcoin is too high.” Which actually is true because if I ev …

Aaron Lammer: Which is true.

Jay Kang: … [inaudible 00:34:48] actually bought Bitcoin at the point, I would be fucking wrecked instead of kind of wrecked.

Aaron Lammer: Well I would have said, “Don’t buy … “ I’m not buying above 10,000 again. I already learned that less, but I think I would have furthered that message too is, “I’m not buying anything while Bitcoin is above 10,000.”

Jay Kang: That’s a terrible statement then of your confidence in the …

Aaron Lammer: Well this is all going to be out the door once we get around. I’m just trying to hold my horses now. I think that there will be sub $10,000 Bitcoin again before it goes to $20,000.

Jay Kang: Oh my God. Do you remember when Bitcoin was doing these crazy fluctuations about a year and a half ago, and you and I were trying to buy these dips, and having our GDAXs [inaudible 00:35:39]. There was always this thing where you would say, “Man, this is the last Bitcoin is ever going to be $11,000.” I would think about it.

Aaron Lammer: I’m still saying things like that.

Jay Kang: Yeah, I would think about it as probably not true, but then I would think about it some more and then I’d be like, “But what if he’s right.” Then I would get really mad at myself. I would picture a world in which Bitcoin was $450,000 a coin and I’m like, “Oh my God, I could have had it at $11,000.” The fact that those types of thoughts are coming back into the public. It’s just not me, it’s a lot of people I do talk to. I don’t know, maybe that’s a good sell signal, honestly.

Aaron Lammer: Let me ask you how you read something. You were like, “I didn’t think Bitcoin could ever get that much momentum again.” It doesn’t actually feel like right now, like when we were at $13,000 something yesterday, it didn’t feel like we had as much momentum as we did last time crossing $13,000. I guess my question is, without that momentum, does that mean there would be even more momentum as we get higher? If we can get this high without a mania, at what point do you see a mania kicking in and how far would a mania take it?

Jay Kang: Well okay, my friend here has a ton of Bitcoin. He was talking to me about it and he was like, “Man, I … “ He got a lot of this around $4,000, or $3500 was when I think a lot Bitcoin was acquired. He said, “I can’t wait for this crazy bull run that’s going to happen and I’m going to be rich.” I was like, “What? Like the bull run from 3500 to 10,000? What is that, what do you call that?”

Jay Kang: Why is that not the bull run? I think that the thing that we have in our heads now, which is sort of a economic psychology type of thing or behavioral science type of thing, which is just like, if we’re not approaching the all-time high, then we don’t think that it’s an actual bull run. I bet that some of the intervals between climbs, from this climb from 3500 to 11,000, and it was 13,500 yesterday, I bet they happen faster than they did last time, but we just don’t think of it that way because the [inaudible 00:38:02] wasn’t reached in the same way.

Jay Kang: I think that we’re dealing with a lot of delusions right now and a lot of bad memory. I don’t know. What could mania produce more than what it has produced over the last few months in terms of price action?

Aaron Lammer: I just think that we could psychologically it won’t feel like a mania until higher, just like you described, it made those moves faster. When it was getting up to 10,000, I was like, “It might just not stop here until 12,000.” Then when it crossed 12,000 like, “It might not stop here until 14,000.” It caught right below 14,000. But it would not have shocked me to see it keep creeping up, because I feel like primed to … We’ve seen this over and over again, people are primed to do the same thing twice. The market is primed to trick you into making the same trades.

Jay Kang: Yeah, or it makes you worst. I think I’m worst now than I was back then.

Aaron Lammer: Me too.

Jay Kang: The first time, in terms of trading.

Aaron Lammer: I’m in my own head.

Jay Kang: Yeah, I’m totally in my own head.

Aaron Lammer: Last time I was just shooting my shot.

Jay Kang: I basically … We both have the yips.

Aaron Lammer: I am now so gun shy that I can’t trade. I’ve got all these altcoins that I don’t even have an account in a alt exchange. I don’t even know how to trade them if I want to. I’m just going to stay with the exact same portfolio forever and my overall bet is basically just somehow crypto becomes a lot more valuable over the next couple of years.

Jay Kang: You’re Doug Kimming it at this point.

Aaron Lammer: We got to get Doug back on here. Those iron hands have been really holding.

Jay Kang: I really am curious how many of the coins that Doug has hundreds of thousands of dollars in don’t exist anymore, the ones that he refuses to sell. I just want to know how many of those projects have nobody working in their offices. I bet there’s at least one of them. Do you think QTUM is one, like are you fully?

Aaron Lammer: QTUM has been pumping. It’s up 100% this month.

Jay Kang: Really?

Aaron Lammer: Yeah, it’s been going crazy.

Jay Kang: That’s good for Doug then. Do you have QTUM?

Aaron Lammer: I do not have QTUM. I will say this, in terms of us being worse than we were last time, last bull run I just enjoyed seeing my fiat number go up. This time I just sit there watching my Bitcoin value go down. I actually have enjoyed this little crash here, just because it slightly up in my Bitcoin value, which was plummeting.

Aaron Lammer: I’m still very heavy in Ethereum, I’ve still got a significant Monera and Zcash bag, and a little ZRX and a little Cardano. Basically that means every time Bitcoin has gone up, I’ve lost Bitcoin value. I’ve never ever even come close to outpacing Bitcoin, and it means that actually, I can pretty well see where I would have been with just holding Bitcoin and it’s pretty crazy as compared to where I am now.

Jay Kang: What do you think is going on then? Why can’t you move up these coins? I’m curious about this just because I have a similar story, and I’ve been thinking about it a lot recently, and it has to do with my stock portfolio where I think about it and I am just like, “Okay, I have so much money invest … “ Not totally number, but percentage wise. I have a large percentage of my money invested in these big cap tech companies, and I am very worried about them taking a big hit. I think it would be good for the world. If I could root for an outcome I’d be like, “Oh, all these places get broke up. When they do, I’m no longer in their stock,” so I can cheer for that without any reservation.

Jay Kang: But I just can’t bring myself to sell anything or move my percentages around at all. I have no idea why. It’s this constant paralysis that I feel. I also felt that after in crypto as well just because I just didn’t want to get destroyed and compound my mistake, and I feel that way about crypto right now too. I just don’t want to … I’m just very gun shy. I feel like I’m a guy who’s like, “Oh, I’ve played this golf course before and I know all the holes,” but really all he’s thinking about the shots that he fucked up in the past instead of just going out and hitting it.

Aaron Lammer: I think the term you’re looking for here is FOMO. You are afraid of missing out on the later performance of these stocks and coins because previously you have seen when they have done very well, and you’re like, “Man, if I sold the bottom and then I watch … “ If you sold the Kang Line and then watched Bitcoin go to 20,000 again, that would just be so painful. Your brain just doesn’t want to go through that, so you want to stick to your position so you don’t FOMO out on the success of those positions.

Aaron Lammer: That keeps me in altcoins when quite literally I had no longer believed nearly as strongly in altcoins. I don’t necessarily think any of these altcoins, except maybe the privacy ones, really need to exist.

Jay Kang: What about Ethereum? Maybe we can end on this, but this was something I wanted to ask you, just because I’ve bought some Ethereum for the first time in over a year. What is your assessment of its health right now and its necessity? Because that was one thing I was thinking about in terms of Libra. If you have a Facebook coin, you don’t need the programmable money part. You can just program the thing and use Libra. You don’t need the money itself to be programmable, you can just build a conduit through which the money goes through.

Aaron Lammer: I don’t really see Libra as having that many implications for smart contracts. I see Libra as more squarely in Ripple’s court. If there’s one top 10 coin that could imagine absolutely collapsing right now, it would be Ripple because I feel like Ripple’s always been about a house of cards.

Jay Kang: It’s getting absolutely pummeled right now.

Aaron Lammer: I feel like Ethereum’s to me like a value buy right now, where it’s like …

Jay Kang: Really? At $350?

Aaron Lammer: It just crashed. It’s at $280 now.

Jay Kang: No, no. That’s really bad. I bought it at $350.

Aaron Lammer: No, now it’s [crosstalk 00:44:38] [inaudible 00:44:38] not yesterday.

Jay Kang: Holy shit. No way.

Aaron Lammer: Now at 285, I guess what it’s trading at against Bitcoin if anything good happens for Ethereum making gain against Bitcoin, which I think would mean pretty good returns, I don’t know that Ethereum’s case has gotten that much worst other than everyone is really in a waiting pattern with these things and I’m unclear on whether the actual patience for Ethereum is going to be long enough for Ethereum to even have a shot to disappoint people. I’ve just lost the narrative, like am I supposed to be doing anything with Ethereum in the next five years? If not, maybe this was all a little premature.

Aaron Lammer: But I’m holding onto it just because it’s so wrecked to Bitcoin, and I don’t want to FOMO out if Metropolis or whatever, people are going to email me and tell me that Metropolis is already out, but whatever the next Ethereum is, I would be bummed out if Ethereum runs against Bitcoin here, but I think that’s a sucker’s bet. I’ve probably held onto it for too long at this point.

Jay Kang: I bought Ethereum at $349.30 and I bought Litecoin at $135.29.

Aaron Lammer: I think we’re giving you the CoinTalk Trader of the Year Award for this one.

Jay Kang: I bought the absolute top.

Aaron Lammer: It’s a talent, Jay. Not everyone can do it. Not everyone can call those local tops and just buy the shit out of them.

Jay Kang: You could sometimes get to my level at that.

Aaron Lammer: Luckily I have been all-in since the bottom, which has prevented me from worsening my position, which is now still an underwater position, but at least is close to [inaudible 00:46:31].

Jay Kang: I don’t think anyone has the same ability though to just randomly sign in and be like, “I’m buying today,” and then have that be the top. I feel like that is my real true … It’s a spontaneous top buying.

Aaron Lammer: You’re always buying the opposite of the thing that I think you’re going to be buying. You’re buying Ripple a few weeks ago, and now you’re buying Litecoin. I wish James could make a super cut of you insulting Litecoin. I think you just called Litecoin a fraud earlier in the show. You hate Litecoin.

Jay Kang: I definitely called … I called it a fraud like 20 minutes ago.

Aaron Lammer: You have never said anything good about Litecoin.

Jay Kang: But [inaudible 00:47:10] $135 in notes. Oh my God, I’m so wrecked. This is so dumb. Anyway, okay.

Aaron Lammer: All right. Well thanks for chatting. It’s been enjoyable bouncing off the Kang Line with you. I don’t think we’re out of the turbulence. I would expect us to have our seat belts on for the next few episodes.

Jay Kang: I hope so. It’s actually been fun to talk about the price, even though for a long time we’re like, “We’re not going to talk about the price.”

Aaron Lammer: If there is one thing I’m a little excited about it’s the bull run and Libra have at least made for enjoyable shit talking conversations again.

Jay Kang: Yeah, agreed.

Aaron Lammer: All right, well I’ll see you next week.

Jay Kang: Yep, bye.

The official podcast of Bitcoin crashes. Hosted by @aaronlammer and @jaycaspiankang. Mailbag/contact:

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