Not exactly news for the frustrated bitcoin Bulls risking assets around the planet for months have been posting what look like daily all-time highs, while the price action in BTC remains fairly muted.
“What if everyone is looking at this wrong?” asks Jordi Visser, a long-time traditional financial asset manager, in a widely shared weekend essay (1.5 million views on
While Bitcoin never had a traditional IPO, the factors that limit price gains are almost exactly the same as those that cause poor price performance in stock IPOs, Visser argues.
Visser reminds that Tradfi IPOs and the following months, particularly in technology, are important liquidity events for early investors.
“Early-stage investors take enormous risks,” Visser wrote. “If the investment is successful, they deserve huge rewards. But eventually, and this is crucial, they need to realize those gains. They need liquidity. They need an exit. They need to diversify.”
The examples, particularly in technology, are legion, but consider Facebook’s (now Meta) initial public offering of 2012. The offering at $38 a share raised $16 billion at a valuation of $104 billion—curious numbers today, but staggering amounts at the time. A year later, the stock was down 30% and experts were questioning Mark Zuckerberg’s leadership.
More likely than Zuck’s missteps were early investors—whether his Harvard friends, or the Silicon Valley guys, or the carpenters who built Facebook’s first offices (who were paid in stock instead of cash)—using the public markets to make life-changing profits.
The most important thing, says Visser, is that the early investors do not make the offer all at once. “They are methodically allocating their positions. They are being careful. They don’t want to drive the price down. They are patient. They have waited years for this moment. They can wait a few more months to get it right.”
The result, he says: “A side job that drives everyone crazy.” Sound familiar?
Economic forces do not disappear
“On-chain data tells a clear story if you know how to read it,” Visser says, referring to bitcoin. “Old currencies, currencies that haven’t moved in years, some dormant since the days of single-digit prices, suddenly become active.”
ETFs, institutional adoption, friendly regulatory environment… this created IPO-like conditions for early bitcoin believers.
“For years, liquidity simply did not exist,” he wrote. “Try selling $100 million worth of bitcoin in 2015. It would drive the price down. Try selling $1 billion worth of bitcoin in 2019. Same problem. The market couldn’t absorb it.”
“But now,” he continued. “ETFs are offering an institutional offering. Large companies have bitcoin on their balance sheets. Sovereign wealth funds are getting involved. The market has finally matured to the point where early holders can exit significant positions without causing chaos.”
Once again, Visser reminds, everything is not being done at once: no one is interested in making the price fall. But instead, constantly and methodically: hence the lateral movement and rallies that reverse so quickly.
patience is required
What’s happening now is nothing that could be called a bear market, Visser says, but rather a distribution of ownership.
In the long term, this is a bullish event, but the process (at least in traditional markets) can take between 6 and 18 months. Although cycles often accelerate in cryptocurrencies, Visser suspects there could be many more months of this frustrating price action in bitcoin.
“Sentiment will only improve when distribution is substantially complete,” he wrote. “People are demoralized because they don’t understand what phase we’re in. They’re waiting for bitcoin to ‘catch up’ with stocks. They’re worried about the four-year cycle. Be patient. Once the heavy selling pressure dissipates, once patient accumulation by institutions has absorbed the OG supply, the path becomes clearer.”
