About This Episode
The crew is back with a wide-ranging breakdown of the week’s biggest themes. They discuss what’s happening on the ground at Bitcoin Investor Week in NYC, then dive into the ongoing debate around bull versus bear markets and whether the market has finally found a bottom. The episode wraps with a discussion of Strategy’s latest earnings call and what it signals going forward. Here’s the latest with III Capital
In This Episode
- 00:02:20 — Bitcoin Investor Week in NYC
- 00:10:20 — Bull vs Bear Markets
- 00:28:30 — Is the Bottom In?
- 00:42:10 — Strategy’s Earnings Call
Episode Summary
Key Themes: Fundamentals first; bear market building; conviction vs. weak hands; volatility & narratives; forced selling & leverage; time as alpha; AI-driven uncertainty; digital credit.
Bear Market Conferences: Conviction & Building for the Next Cycle
At the Bitcoin Investor Week conference, Matt said these events matter because real ideas and deals can form at them, citing the SMLR merger’s origins. He added that bear market conferences are perhaps more important, even if less attended, because they cut through hype. Matt argued that bear markets separate weak-conviction buyers from serious holders who use drawdowns to re-evaluate the fundamentals of the thesis, which he believes are stronger than ever. Ben said that though Bitcoin conferences often coincide with a price drop, the mentality shift of a bear market focuses the room on building and getting creative about different structures and strategies for the next cycle. He said, “you build during the bear so you can thrive during the bull.” Joe added that bear markets are a healthy purge that flush out both bad ideas and weak hands—often forced sellers who are overexposed, overlevered or don’t understand what they own—leaving the strongest long-term holders and the best ideas for the next bull run.
Time is the Alpha
Matt noted that Strategy’s story proves that the Bitcoin treasury model isn’t a straight line up—the real alpha is time and the ability to whether out volatility without forced liquidation. He warned that posting margin is a catastrophic mismatch for Bitcoin’s volatility and pointed to Cango selling over half its Bitcoin near lows as proof why well-structured treasury companies justify an mNAV premium. Ben said that he doubts Cango were the only sellers and suspects there was some forced selling from convert collateral triggers, showing why avoiding true leverage matters.
Volatility & Unchanged Fundamentals
Ben said that because this drawdown lacked a clear catalyst (like when FTX and others blew up), it created confusion and fear, but that the fundamentals are unchanged and adoption/regulatory developments support riding out volatility. Joe posited that price moves first and simple narratives are invented after the fact to justify it, and because Bitcoin is volatile to begin with and there can be many reasons for price moves, it’s difficult to single out exactly what causes drawdowns. So ultimately, his anchor is fundamentals: Bitcoin’s scarcity and monetary properties haven’t changed, so drawdowns are the price of admission for long-term compounding. Ben added that volatility is everywhere right now (even in metals), and with falling inflation plus Fed-chair uncertainty, we can expect choppy markets and renewed fear narratives. Matt agreed and said it’s why he never calls a bottom because Bitcoin’s upside skew makes missing the rebound too costly; instead, he urges zooming out and sticking to fundamentals, which he also agrees haven’t changed. He added that with AI scrambling markets—metals ripping while SaaS getting crushed—paired with falling inflation and increased uncertainty, volatility is the new normal, making fundamental analysis more important than technical charting analysis.
No Top, Cost Basis Psychology & “Sell to What”?
Matt said that he learned the hard way that the most common biases in Bitcoin are not being bullish enough or having too short a time horizon—he once wanted to sell at $10k (or hopefully $100k), but eventually came to see that Bitcoin has “no top because the other side’s being debased.” Ben suggested that people’s emotional reaction to Bitcoin is anchored to their cost basis—newer buyers who entered above $100k feel this drawdown differently and this is a make-or-break moment for them when they can either dig in, test their conviction and learn what they own, or sell out as weak hands. He added that many “tech” investors got hit on both SaaS and Bitcoin, driving capitulation, but that Bitcoin ETF flows surprised to the upside, reinforcing that Bitcoin’s network/fundamentals kept working through the storm. Joe pointed out that there is nothing better into—those who bought Bitcoin already cashed out into the least-uncertain money, and the usual alternatives (gold, stocks, real estate) are near their respective record highs. He added that since most of the world still doesn’t grasp Bitcoin or is under-allocated, Bitcoin can keep absorbing value from other assets over time despite volatility.
Strategy Goes All in on STRC
Ben said that Strategy’s earnings call made it clear that they’re now all-in on STRC with less emphasis on the other preferreds. Joe added that their growing USD reserve is likely aimed at upgrading credit quality and addressing rating-agency concerns. Matt agreed and framed it as an investment-grade push to lower their cost of capital and use STRC as the engine for long-term Bitcoin outperformance, which is especially important to prove in a bear market.
Main Takeaway: Drawdowns are when Bitcoin’s thesis and treasury-company structures get stress-tested—avoid margin, zoom out to unchanged fundamentals, keep a long-time horizon and build for the next cycle.