Chat with the Godfather of Crypto: $60k Bitcoin is Definitely Not the Bottom, the Real 'Capitulation Moment' is in October

Compiled & Organized: TechFlow

Guest: Michael Terpin (Founder and CEO of Transform Ventures, author of "Bitcoin Supercycle")

Hosts: David Lin, Bonnie Cheung

Original Title: Is Shorting Bitcoin the Right Move? Godfather of Crypto: This Price Level is the Last Line of Defense!

Podcast Source: Bonnie's Blockchain

Release Date: May 14, 2026

Editor's Introduction

In this episode, Michael Terpin makes a bold prediction: the area around $60K is likely not the true bottom of this cycle. The odds favor a further decline to the $48K–$57K range, with the time window pointing to October of this year.

Known as the "Godfather of Crypto" by CNBC and a guest at Saylor's private events, Terpin reveals the inside story behind Saylor's strategic shift: the pressure from STRC's 11.5% dividend means Strategy must retain an "escape valve" to sell coins for payments, which is not a strategic wavering but driven by the financing structure. Furthermore, he maintains his long-term target of Bitcoin reaching a million dollars by 2033 and asserts that AI tokens will outperform Bitcoin over the next three years. He also predicts that the real threat from quantum computing is not to BTC but to smart contracts on Ethereum, and that Satoshi's alignment of halving cycles with U.S. elections was no coincidence.

Key Quotes

Saylor's Shift & STRC's Financing Structure

• "The reason Saylor now leaves room for [potentially selling coins to pay dividends if needed] is fundamentally because his source of financing has changed. STRC has become a product driven by both retail and institutions. The 11.5% dividend is roughly three times the treasury yield; he must demonstrate the ability to pay out in extreme scenarios."
• "Saylor's goal is to escalate monthly purchases from their current level to $10 billion, $100 billion, $1 trillion, and $10 trillion progressively. I don't know if $10 trillion is achievable, but $100 billion in monthly purchases is achievable in the foreseeable future. That is massive buying pressure, essentially setting a floor under any Bitcoin decline."
• "His OTC purchases each time don't immediately push the price up; they are surprisingly gentle. OTC is precisely the channel designed to obscure buying and selling behavior."

The October Bottom Thesis

• "We currently have about a 60% probability that we are still trending downwards, targeting the $48K–$57K range. The difference from my call in February is that I no longer believe it will drop below $40K; the buffer provided by STRC and ETFs has raised the lower bound."
• "Historically, each bottoming process takes about a year: the last cycle took a full year, the one before that was three days short of a year, and the first halving cycle was a year and a few weeks. If this cycle ended in just 12 weeks, it would mean numerous historical patterns failing simultaneously—a very low probability event."
• "The 'Coin Days Destroyed' metric points to a bottom around $42K; it has been accurate in every past cycle. Coupled with the two empirical values of 23 months [from first high to bottom] and 35 months [from bottom to top], these three independent indicators all point to October being the bottom."
• "The main selling pressure now is not from whales; whales sold out back in September, October, November of last year. Today, most selling pressure comes from liquidations. With the proliferation of perpetual swaps and 100x leverage tools, there are many more ways for retail to get liquidated than four years ago."

Supercycle, Diminishing Returns & Satoshi's Design Intent

• "From $0.001 to $30 was a 3000x move, the second cycle 100x, the third 30x. The fourth cycle was originally expected to be 10x but ended up around 8x due to macro headwinds. Log-level diminishing returns and arithmetic-level convergence in drawdowns—this is the real mathematical structure of the halving cycles."
• "A supercycle must satisfy two conditions: lasting over 5 years, and a fundamental change in the asset's core narrative. When CME suggested in 2023 that monetary debasement might trigger a new commodity supercycle, it was uncertain. By 2025, the answer was already clear."
• "I don't believe Satoshi aligning halving times with U.S. elections was a coincidence. Every halving occurs near an election year, with bear markets landing in mid-term election years. This shows he had a very precise understanding of economic rhythms."

Quantum Threat, AI Tokens & Their Relation to Bitcoin

• "True quantum attacks capable of breaking Bitcoin are still 15 to 20 years away. Before that, attackers would first target other SHA-256-based systems—defense, hospitals, banks, etc. Cracking Satoshi's wallet would be far harder than cracking JPMorgan."
• "My real concern isn't quantum breaking Bitcoin, but a frontier AI model (like the 'Mythos'-level models OpenAI supposedly won't release) falling into the wrong hands and compromising a critical smart contract on Ethereum, such as Lido which stakes a massive amount of ETH. That would be the potential 'FTX moment' of this cycle."
• "Over the next three years, leading AI tokens will outperform Bitcoin. A significant portion of those gains will ultimately flow back into Bitcoin. Additionally, stablecoin users now possess wallets for the first time, drastically reducing the friction to enter Bitcoin."

Jane Street Selling Pressure & Wall Street's Playbook

• "It has been widely reported that Jane Street systematically sold Bitcoin half an hour after U.S. market open while simultaneously building short positions. I have no direct evidence, but the fact that the price went up after this activity stopped is itself a form of confirmation."
• "The classic whale-era playbook was: buy large amounts OTC, short on small exchanges, let arbitrage bots drag the market price down, then profit from both covering shorts and OTC discounts. This game has existed in gold markets for a long time; now Wall Street is bringing it to Bitcoin."

Saylor's Strategic Shift

Host David: Welcome back to the show. We are back at Consensus Miami, delighted to have Michael Terpin on for the second time within a year. Michael is the author of "Bitcoin Supercycle," called the "Godfather of Crypto" by CNBC, and founder and CEO of Transform Ventures. Today we want to hear his take on where Bitcoin goes next.

Host Bonnie: Michael, we'll talk about Bitcoin's direction in a bit, but first please answer a timely question—Saylor's strategic shift, what's your take? I know you're a major investor in STRC and we discussed it three months ago.

Michael Terpin: He himself says it's not a shift; this relates to his current source of financing. I've discussed this with Saylor many times. I've always advocated that if your goal is to accumulate more Bitcoin long-term, you should sell at the top and buy back at the bottom. That's the core thesis of my book, and my fund operates that way.

Saylor told me about two years ago that if he made any move other than "buying forever," Wall Street buyers would suspect his thesis had changed and stop writing him blank checks. At that time, his financing sources were institutional buyers of preferred shares and other instruments. But STRC has changed; it's now a retail-and-institution-driven product.

The market's concern now is: how does he pay the 11.5% dividend? It's almost triple the treasury yield yet still relatively safe. He must demonstrate he can sell Bitcoin to pay dividends, but that doesn't mean he actually will. Historically, Treasury companies were forced to sell coins because the board was in crisis and the market had already crashed to the bottom. That's not Saylor's situation. He and Strategy are steadfast long-term holders. His financial engineering structure—borrowing at 11.5% to capture over 20% annualized appreciation—is sound. But you must leave an "escape valve" in case selling becomes truly necessary. Personally, I highly doubt he'll do it in the short term.

The Long-Term Path to a Million-Dollar Bitcoin

Host David: A year ago at BTC Vegas, you predicted Bitcoin reaching one million dollars by 2033. Does that call still stand?

Michael Terpin: It stands. I have made no revisions to my million-dollar prediction. We are currently in "Bitcoin Autumn" (the downturn phase in Terpin's seasonal cycle framework). The only real change from a year ago is the emergence of STRC, which provides a purchase scale for Strategy that was previously impossible in a bear market. Saylor raised about $7 billion at his last ex-dividend date.

Last week at the Bitcoin Conference in Vegas, he gave a private session for whales after his keynote. He said his goal is to escalate monthly purchases from the current level to $10 billion, $100 billion, $1 trillion, $10 trillion. I don't know about $10 trillion, but $10 billion monthly purchases will certainly be reached in the not-too-distant future, and $100 billion is foreseeable. That is massive buying pressure. I believe this essentially sets a floor under the bottom.

Back in February, because the price didn't touch the 200-week moving average, I judged it wasn't the true bottom. It needed to break below $57K to truly touch it, but it only reached $60K and rebounded hard. The pattern in the past three capitulation phases wasn't a hard rebound like that; it was a prolonged sideways grind where everyone lost interest in Bitcoin.

Who is Driving the Price?

Host David: We interviewed Saylor earlier today, and he humbly said his buying doesn't move the price. What do you think?

Michael Terpin: I wouldn't say his buying moves the price at all. I'd say he sets a floor under declines because I believe if it drops to levels like $39K, he'll buy even more. At the same time, each time he buys, the price increase is surprisingly small because he buys via OTC channels, which are designed to obscure transactions. Historically, many whale-era movements originated this way: large OTC buys, then public market selling to drive prices down while building shorts. This is a trick Wall Street has already played on other assets. I think there are traces of such games in the violent volatility around October 10th.

Host Bonnie: As more whales or institutions accumulate larger shares, how will Bitcoin's volatility change?

Michael Terpin: The share held by whales isn't actually increasing; institutional share is. But I believe most of the whales who sold in October will buy back proportionally or even more, which is the core of the "Four Seasons Theory": fear and greed drive seasonal shifts, and selling prices at the end of "Bitcoin Summer" are much higher than buying prices at the beginning of "Bitcoin Autumn." If you accurately identify the first day of "Autumn" (bubble burst) and the last day (capitulation), achieving over 4x returns in a single cycle isn't difficult.

Host David: If institutions treat Bitcoin as permanent capital accumulation, wouldn't that make the market less liquid and more volatile?

Michael Terpin: If it were truly permanent capital, yes. But ETFs are not permanent capital; funds still flow in and out. However, ETF holders do have lower turnover than first-generation retail. First-gen retail are those unwilling to self-custody, find Coinbase too troublesome, and only accept buying through traditional broker accounts like Charles Schwab. Historically, they sell on stops during price declines, but their selling proportion is indeed more muted than the retail from 4 or 8 years ago who "chased highs after hearing from friends and panic-sold near the bottom." Perhaps it's because they call their broker and get advised to hold for 10 years in an IRA.

Host Bonnie: Saylor is buying large amounts OTC, meaning someone is selling to him OTC. Are whales selling?

Michael Terpin: Whales already sold out. The main selling force now is liquidation pressure. The ways to get liquidated via perpetual swaps and various new derivatives are far more numerous than 4 years ago. Four years ago, BitMEX was the first to offer 100x leverage; now platforms like Hyperliquid have it. Combined with the proliferation of trading bots, many retail traders think they're geniuses after making a little profit and go heavily leveraged, only to get liquidated. The scale of liquidations can be seen directly on-chain. I wouldn't say it's the majority of selling pressure, but it accounts for a significant portion.

Host Bonnie: You said whales have already sold out. Are these whales trading, not cold wallets?

Michael Terpin: The vast majority of whales are cold wallet holders. The portion that sold likely represents only about 10% of wallets holding coins for 8+ years, especially 10+ years. Most old wallets have never moved, or moved once to transfer into SegWit addresses for OpSec. Within each 4-year cycle, they sell twice: near the top and buy back only after the bottom is established. They typically sell a bit early and buy a bit late, always thinking it could go lower. This was very clear on-chain in the 2021–2022 cycle.

Why $60K is Likely Not the Bottom

Host David: Last time we spoke, Bitcoin was at $60K, and you predicted it would go lower.

Michael Terpin: Right, that was when we spoke in Hong Kong. This time it approached a bottom but didn't truly touch it. According to Saylor, February was the bottom. If February truly was the bottom, it would mean the majority of historical patterns failed simultaneously. Typically, only one or two patterns change per cycle, but when most change, you have to question the entire cycle judgment.

First, historically each bottom takes about a year: the last cycle a full year, the one before three days short of a year. If it ended in just 12 weeks, the time dimension of capitulation is insufficient; those holders who aren't stopping out but are genuinely weak-handed haven't truly given up yet.

Second, technical indicators point to October as the bottom. The 'Coin Days Destroyed' metric (measuring selling intensity of long-term holders) points to around $42K; this metric has been accurate every time historically. Plus the time window from "first assault on new highs to capital capitulation": past two cycles were 23 months. Combined with the "35 months from bottom to top" pattern, which from the last top to now is roughly 35 months minus a few days, aligning perfectly with the bubble burst timing. Both these 23-month and 35-month patterns point to October this year.

The only debate is that this cycle saw its "first new high" before the halving (post-ETF approval in March 2024, hitting $73,850 then retracing), which is historically the first time. If you count the 23 months from that ETF month, it points to February this year, coinciding with that $60K low. So my judgment has been: 70% probability the bottom isn't in yet. Today the price just pulled to $83K; I think it's a good shorting opportunity, my fund is doing so. But now there's roughly a 40% probability the bottom is already in, so we also hedge inversely. Overall, the odds favor further downside two-to-one. I sold in the $80Ks and can buy back in the $60K or even $50K range.

Compared to February, the only change is I no longer believe it will break below $40K; buying from STRC and ETFs provides a buffer. Each halving cycle has diminishing returns and diminishing drawdowns. This cycle is historically the lowest-returning. I originally expected a 3x gain under neutral macro, but it's only been a bit over 2x. I originally expected a ~66% drawdown; currently from $126K to $60K is only about 54% down. So the eventual bottom I estimate is $48K–$55K, maybe even $57K. As long as it breaks February's $60K low and touches the 200-week moving average, the cycle narrative holds.

Will AI's Impact on Software Spread to Bitcoin?

Host Bonnie: AI is disrupting the entire software industry. The IGV ETF (software index ETF) is down about 25% year-to-date, with mainstream media saying "anything built on code is being repriced." Bitcoin is also code-based; will it face similar repricing?

Michael Terpin: No. Bitcoin has withstood countless attacks. No 'Mythos'-level model will unravel Bitcoin's code; its protective layers are too thick. Bitcoin isn't just code; it's all the permanently archived blocks. The quantum threat is about theoretically brute-forcing private keys, compressing what takes billions of years into minutes to try all combinations of a 45-character alphanumeric string, but I believe that's still 15 to 20 years away.

Moreover, before attacking Bitcoin, quantum computing would first target other SHA-256-based targets: defense systems, hospitals, banks, etc. To crack Satoshi's wallet, you'd have to get through JPMorgan first. Bitcoin is cracked wallet by wallet; you can't crack the entire network at once. That's its decentralization advantage.

My real concern is AI compromising a critical smart contract on Ethereum, causing an Ethereum price crash that drags Bitcoin down. This is what I think is the most likely "FTX moment" between now and October—for example, Lido (Ethereum's largest liquid staking protocol) getting breached, with staked ETH siphoned off to North Korea. An event of that magnitude could drag Bitcoin into the $40K range. Without such a black swan, just regular hedge fund unwinding might only drop it below $60K.

Host Bonnie: Everyone talks about quantum breaking Bitcoin, but few talk about Ethereum. Could quantum break Ethereum first?

Michael Terpin: I didn't say quantum breaking Ethereum itself, but rather that smart contracts built on Ethereum could be compromised by next-gen frontier AI models. For instance, OpenAI internally reportedly has some 'Mythos'-level models they won't release; other labs have equally powerful models now. If such a thing falls into the wrong hands, they'll actively seek vulnerabilities. Historically, the closest thing to dissolving Ethereum was the 2016 DAO attack, where Vitalik and the community decided to hard-fork the main chain to erase the hack. At the time, $60 million represented double-digit percentages of Ethereum's total market cap; price dropped from $30 to around $6, but eventually recovered.

Bitcoin, Nasdaq, Gold Correlation & War Hedging

Host Bonnie: From a supercycle perspective, why have Bitcoin, Nasdaq, and Gold moved in sync over the past three months? I overlaid them on one chart; ignore the orange line for 10-year yields, but the other three lines have moved very similarly over the last 6 months.

Michael Terpin: Post-war, Bitcoin actually had an independent move; it went sideways then up, while Gold didn't move in sync during that period. I haven't done a day-by-day comparison, but Bitcoin outperforming Gold post-war is relatively rare in recent years.

Host Bonnie: Does this mean the narrative of Gold as a war/hedge asset is being replaced by Bitcoin?

Michael Terpin: Not yet. "Bitcoin is digital gold" has been the dominant narrative for years. While still far smaller than the gold market, Bitcoin has features many see as more robust than gold, like scarcity: new supply halves every 4 years. Gold's annual new supply is about 1.5% of existing stock. At that rate over 100 years, gold stock increases ~150%, while Bitcoin increases only ~4%.

Global Liquidity, Presidential Elections & Supercycle

Host David: Do you believe liquidity remains Bitcoin's primary driver? Lyn Alden a few years ago overlaid global M2 money supply growth with Bitcoin price, showing strong correlation. Does this challenge your cycle theory?

Michael Terpin: No, they are complementary. Global liquidity cycles are primarily driven by presidential elections and related policies. I wrote in my book that Satoshi aligning halvings near presidential election years and bear markets near mid-term election years is no coincidence.

Host David: Why do you say it's no coincidence?

Michael Terpin: Satoshi didn't explicitly say it in the whitepaper, but the fact is 2012, 2016, 2020, 2024, next 2028—all align with U.S. elections. He couldn't precisely control it anyway because the cycle isn't a fixed 4 years; it's 210,000 blocks, targeting 10 minutes per block, which works out to 4 years. The difficulty adjustment algorithm automatically makes mining harder or easier based on block speed. That's how this mechanism provides additional network security; my book has a whole chapter on mining economics.

Host Bonnie: So the 4-year cycle is based on U.S. elections; Satoshi designed it around the U.S.?

Michael Terpin: I believe so, because the U.S. remains the world's most powerful economy, influencing globally. Whether Satoshi was an individual or team, their understanding of economics was very precise and predicted this arrangement would run stably for over a century. Once past the initial 5, 6, 7 cycles, you enter the supercycle effect discussed in my book. Even though we're only in the fifth cycle, Bitcoin's issuance is already 96% complete. The first cycle was the most profitable—you could mine coins for less than a cent, though before 2010 you couldn't sell them. Hal Finney (the recipient of the first Bitcoin transaction and the first miner besides Satoshi) once said something like: "This will either go to zero or to $10 million per coin."

Host Bonnie: Do you think Hal Finney was Satoshi?

Michael Terpin: He's certainly one of the suspects. It's still a mystery; there are about 20 candidates with plausible suspicion, but none proven. Recent suspicion pointed to Adam Back (Hashcash inventor, Blockstream CEO), but he denied it. Many oppose this view, citing his British spelling habits and timezone data from posts showing Canada. So it remains speculation.

Fiat Debasement, Trust Erosion & Commodity Supercycle

Host David: How much of Bitcoin's rise over the past decade has been driven by fiat debasement and sovereign debt accumulation?

Michael Terpin: A large proportion. The biggest creator of liquidity is money printing. When the U.S. prints, the rest of the world often prints more, eroding trust in the fiat system. I discuss commodity supercycles of the past 100 years in my book; there have been three. Elliott Wave Theory identifies mega-supercycles and smaller ones. A supercycle must satisfy two conditions: lasting over 5 years, and a fundamental change in the asset's core narrative.

The first supercycle last century was gold in the 1970s. Two narrative changes coincided: Nixon ending the gold standard, and Americans regaining the legal right to hold gold. One opened a new reason to buy gold, the other opened a new demographic, ultimately driving gold's 4x rise in the 70s. The second supercycle was the 1990s, driven by China's hyper-industrialization for commodities like copper, nickel.

My book cites a CME report from 2023 suggesting we might be entering a new supercycle due to printing and monetary debasement, but it was uncertain. By 2025, the answer was already clear.

Host David: Have you heard Neil Howe's "The Fourth Turning"? Does Bitcoin's recent rise reflect the erosion of societal trust from the Fourth Turning?

Michael Terpin: That's an interesting question. Similar theories of two-generational forgetting cycles existed even before "The Fourth Turning." 80 years is a debated window; dramatic events occur every decade. Personally, I've observed very consistent tech cycles over the past 50 years: at least one major disruptive technology per decade, typically starting early-decade and bubble bursting late-decade.

Looking back: the internet started in 1991 (though experimental DARPA networks existed in the 60s). In 1993 when I first accessed it, browsers came from Marc Andreessen's dorm; it was just a university project. Late-decade was the dot-com bubble. The 2000s were Web 2.0 and social media; companies like LinkedIn, MySpace started from zero, late-decade saw mega-unicorns like Facebook. The 2010s were Bitcoin; 2010 you could buy for cents, 2020 near $60K. This decade is AI; 2022 OpenAI released the first commercial LLM, breaking all product user growth records. Netflix took a year to reach 1 million users; OpenAI took 5 days, now nearing 1 billion.

AI, like the internet, simmered for a long time. My brother graduated from MIT's AI lab; in the 90s I thought expert systems and Prolog would make AI take off, but no. LLMs and Agents were the real trigger; now AI accounts for the vast majority of S&P 500 growth.

Will AI Investment Steal Bitcoin's Capital?

Host David: AI is the new sexy investment. So what is Bitcoin?

Michael Terpin: Two points. First, it's a massive pie. There certainly are equity investors rotating from other sectors into the Mag 7 (mainly AI beneficiaries), and 80%+ of Sand Hill Road's budget goes to AI, but these are rotations within asset classes. Gold investors won't sell gold to buy AI; Bitcoin holders won't either. Marginally, someone who previously allocated 30% to crypto might shift to 20% crypto + 10% AI, but money supply keeps growing; every asset has room to grow.

Second, AI tokens have risen a lot even in the bear market, though total size is still small. The overall AI token sector saw a 100x move from October to December 2024, then the bubble burst. Recently, Venice's VVV token rose ~500% in 90 days, from $2 to near $10. Bittensor doubled, though still far from previous highs.

My judgment: Over the next 3 years, leading AI tokens will outperform Bitcoin. A significant portion of those gains will flow back into Bitcoin. Plus, stablecoins are a new force in the crypto economy; stablecoin users now have "wallets" for the first time, drastically reducing friction to enter Bitcoin and other tokens. I was an early participant in Tether, formed in early 2014 in Santa Monica by Brock Pierce, Reeve Collins, later sold to Bitfinex and became independent Tether. The original idea was just "transfer between exchanges without waiting 3 days, and earn bank interest." No one imagined it would become a business with 100 employees earning $20 billion a year from U.S. treasuries.

Cycle Diminishing Returns & Supercycle Math

Host David: How will future cycles evolve? Each bull run's gain from bottom to top has diminished. If this trend continues, mathematically gains will eventually approach zero.

Michael Terpin: Correct. That's why the supercycle is important. We're seeing "log-level diminishing returns" and "arithmetic-level convergence in drawdowns." Specifically: first cycle (pre-halving, not entirely comparable) from $0.001 to $30, 3000x, then dropped 97% to $1; post-first halving from $12 to $1200, 100x, dropped 85%; third cycle 30x, dropped 83%. You see 3000, 100, 30; the next logical number is 10.

I originally expected a 10x gain from the halving price of $8700 during COVID, but it only reached $68K–$69K, about 8x. I attribute it to macro headwinds: the Biden administration's crackdown, Operation Choke Point 2.0, and the rate hike cycle. I'm amazed it was only cut by 20%. This cycle, factoring in the ETF approval month spike to $73,850 (nearly 9x), plus the rebound from the $15K low post-FTX.

Based on this sequence, I expect this cycle's gain to be around 3x, depending on macro. Everyone thought Trump's election would bring tailwinds, but they didn't realize while Trump is crypto-friendly policy-wise, his communication is chaotic. His tweets often trigger market volatility; following "The Art of the Deal" logic he throws extreme demands then retreats to a midpoint to create a sense of victory. This political playbook is a shock to media and markets, resulting in the extreme volatility on October 10th.

October's high aligns perfectly with past cycle tops in the data. Another view is there was maybe a month or two left to run higher, requiring sufficient buying and no black swan. But October 10th was that black swan: Trump tweets, order flow disorder, market makers getting liquidated—it was a perfect storm causing a free fall. There was also coordinated selling and shorting in traditional markets, perhaps certain institutions acting quickly on signals. That initial crash kickstarted the entire bear market.

Jane Street's 10 AM Selling Pressure & Wall Street's Playbook

Host David: Finally, comment on the rumor about Jane Street selling Bitcoin daily at 10 AM.

Michael Terpin: It's been widely reported; I have no direct evidence, but reporting is dense enough it seems likely to have happened. And it has stopped now; after stopping, the price went up. The narrative: Jane Street systematically sold half an hour after U.S. market open, paired with short sellers' typical tactic of spreading bearish news. Actually, the price dropped because they were systematically selling; simultaneously they had pre-built shorts, profiting from both sides.

Host Bonnie: Is this legal?

Michael Terpin: Mostly legal. For commodities or securities there are limits, but Bitcoin's definition itself remains unclear, and the legal boundaries around short-selling activities are fuzzy. I'm not a lawyer, but I know Wall Street banks pay fines annually that are just a tiny fraction of their trading revenue. The games played in the whale era can be, and are being, played by Wall Street now.

Host Bonnie: So Bitcoin spot ETF inflows are what retail sees, but it doesn't mean they aren't simultaneously shorting via derivatives.

Michael Terpin: Correct. The stock market is the same, with dark pools and OTC desks. The classic whale-era profit method was: buy large OTC, short on small exchanges (arbitrage bots automatically drag the whole market price down), while holding a large short position. For example, short at $85K, target $75K; their coin holdings are enough to trigger selling pressure themselves, then buy back at the lower price while covering shorts for profit.

Host Bonnie: Does this explain those famous on-chain addresses that seem to keep losing money, like James Wynn? They probably hedge on exchanges.

Michael Terpin: I can't confirm for them. There are indeed people on X publicly claiming "made $1 billion, lost $1 billion," and YouTube streamers trading live, but what they stream isn't necessarily all their trades. Bitcoin's biggest advantage is on-chain data transparency, but post-ETF, many trades are hidden in Coinbase's internal ledgers and off-chain derivatives markets. This game has existed in gold markets for a long time.

Host David: If you rewrote your book today, what would you change?

Michael Terpin: I'd add more detail on potential end-scenarios for this cycle; previously I simplified the most likely scenario to "~$193K under neutral macro." I'd also add a few formulas, like the 35-month pattern; I just didn't want the book to get too technical.

Host David: Recommend everyone check out Michael's "Bitcoin Supercycle."

Michael Terpin: And your channel too, thanks.