Let's Flow｜Should You Leave the Crypto World for Stock Trading? Cycles, Opportunities, and出路
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Let's Flow｜Should You Leave the Crypto World for Stock Trading? Cycles, Opportunities, and出路
If you're going through a period of confusion, this episode will offer you new perspectives and direction.
Navigating Web3 tides with focused insightsAuthor: TechFlow
Bitcoin continues to pull back, altcoins are in a sea of red, and crypto market sentiment has hit rock bottom. Looking back at 2025, the entire crypto industry hasn't just underperformed against U.S. equities—it's even lagged behind gold. "Should we leave crypto and switch to stocks?" has become one of the most heated debates in the community.
In this episode, we invited two seasoned friends deeply experienced in both the "crypto world" and stock markets to discuss the current market landscape.
If you only had $10 left, would you put it into crypto or stocks? Has the crypto market truly reached its end? What stage of the cycle are we actually in? And what opportunities might the market be overlooking?
If you're feeling lost, this episode will offer you new perspectives and direction.
Guests:
Jiang (XinGPT) (@xingpt): Former member of Binance’s investment team, early investor in multiple well-known Web3 projects, macro-focused, committed to crypto
Frank (@qinbafrank): Macro commentator, former mobile internet and VC professional, focused on secondary market investments in U.S. equities and crypto
The following is a transcript of our conversation. The podcast audio version is also available—subscribe to “Let's Flow” on Xiaoyuzhou FM.
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Youtube: https://www.youtube.com/watch?v=lGkHuhMV8Yg
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Background & Guest Introductions
TechFlow: Over the past few weeks, market sentiment hasn’t been great—especially as many people see others making big gains in the stock market. So the debate resurfaces: should we leave crypto and move into stocks? It’s an interesting topic, so we’ve invited two guests who are experienced in both markets to share their thoughts. Today we’re very happy to have Frank and Jiang here with us. Let’s start with brief introductions.
Frank:
I’m Frank. I started in the internet industry about a decade ago—worked as a product manager at major tech firms, had my own startup, and did some venture capital work. I officially entered crypto at the end of 2017 for two main reasons: first, the growth红利 of traditional internet was largely exhausted; second, many friends around me were enthusiastically pulling me into crypto. That environment drew me in. From 2017 to 2021, I focused on the primary market, worked with many projects, and helped teams raise funds. But after 2021, due to tightening domestic regulations and my location in China, primary market operations became increasingly difficult. So I gradually shifted to full-time secondary market trading. As for U.S. equities, I’ve always been close to internet and tech companies, and I started trading U.S. stocks back in 2013—over ten years now. So I’ve kept an eye on both markets throughout.
TechFlow: Thanks, Frank. Right now, many people best associate you with your 10x gain on Palantir.
Frank: I never expected it to go that high. Last year, I thought a 3–5x return over three years would be great. But it far exceeded expectations. I think there were a few key reasons: First, Palantir’s large model business performed well, especially in defense and military applications. Second, Trump’s election—he has close ties with Palantir—created significant market speculation. These factors叠加 pushed the stock higher.
XinGPT: Hi everyone. I entered crypto around 2018–2019, roughly the same time as Frank, and have mostly focused on VC and primary market investing. Recently, I’ve paid more attention to secondary market opportunities. Last year, I actively traded MemeCoins. This year, I’ve followed both stocks and crypto. Compared to Frank, I came into U.S. equities relatively late. I first tried A-shares—entered right before the 2016 crash, saw thousands of stocks hit daily limits, and that left me with a bad impression of stock trading. Later, I turned to U.S. equities. But because I entered late and valuations were already high, I’ve mostly stayed active in crypto’s secondary market, continuously learning and sharing along the way.
If You Only Had $10 Left, Would You Bet on Crypto or Stocks?
TechFlow: If you only had $10 right now, would you trade crypto or stocks?
Frank:
Right now, I’d allocate across both markets. In the past, I might have favored U.S. equities—say 6:4 or 5:5. My overall logic comes down to a few points:
First, U.S. equities have offered strong opportunities in recent years. The trends in tech, large models, and AI are very clear, and I’m familiar with both markets. Second, while crypto has seen significant corrections, solid opportunities still exist—whether in major coins or smaller ones. But the difficulty today is much higher than before. Unlike 2020–2021, when picking a trend—L1, L2, metaverse, GameFi—would almost guarantee gains within months, this year’s rallies are fleeting, lasting just one or two weeks or maybe a couple of months. Still, from a broad asset perspective, core assets often present new opportunities after corrections. So I keep watching both markets and avoid simplistic views like “stocks are better, crypto has no chance,” or “stocks have risen too much, so crypto must outperform.” My strategy is balance.
Second reason: Crypto and AI are two major future tech trends, and they reinforce each other. Under current U.S. industrial policy, Trump’s agenda explicitly emphasizes AI and crypto. Policy support for these areas is becoming clearer. At the same time, U.S. equities aren’t as easy as they seem. While Big Tech surged in 2023–2024, if you look at many U.S. funds’ performance last year, quite a few underperformed the broader market. Their holdings had decent EPS and maybe 10–15% gains, but compared to Nvidia, they pale. The market is highly concentrated—mainly Big Tech, AI, and related supply chains like power, nuclear energy, and mining farms. Other sectors like consumer goods and healthcare have generally underperformed this year.
Both equities and crypto are fragmenting, but in different ways. The similarity: high concentration. In crypto, either core assets (BTC, ETH, etc.) keep rising, or small-cap tokens briefly shine—like RWA, privacy coins, or mature chain projects rotating in September–October, or sudden themes like Aster or Perp Dex. In equities, Big Tech, energy, and power—areas with policy tailwinds—lead gains, while others remain weak. The difference: equities are less volatile and slower to react to macro shifts; crypto is more volatile and extremely sensitive. For the past two years, many crypto prices have been almost entirely driven by macro liquidity.
I also follow Hong Kong stocks, but mainly focus on crypto and U.S. equities. I don’t pay much attention to A-shares anymore. Partly because I’m not familiar with them, partly because I started with U.S. equities back in 2013–2015, during a golden era for Chinese概念股—most stocks I bought went up. My first stock was Tesla, then Facebook—I caught the wave, didn’t know much, but rode the trend. I entered A-shares near the end of the 2015 bull run, felt optimistic initially, but then faced continuous declines, poor experience, and gradually stopped following. I haven’t invested much or learned enough. Fundamentally, I’m not a pure secondary market trader—I come from backgrounds in Crypto and TMT. So the assets I watch most are still in my wheelhouse: AI, TMT, EVs, and recently, “national destiny stocks” riding U.S. momentum—energy, mining, etc. I rarely venture beyond.
XinGPT: With just $10, I’d probably… pool it to buy an e-bike and deliver for Meituan (laughs).
Because investing such a small amount is too risky. U.S. equity account thresholds are high; A-shares aren’t convenient to operate directly. In crypto, $10 can technically be used, but the margin for error is tiny. Last year, $10 could still test MemeCoin waters—some really turned it around. But this year, $10 in crypto might vanish in two seconds unless you’re an elite, lightning-fast PvP player. Like Huang Mantou, a former colleague at TechFlow, whose style of “entering early, taking a bite, and exiting fast if wrong” works—but it’s extremely draining and hard for most to replicate, especially mid-to-senior professionals who can’t sustain it long-term.
I agree with Frank’s broader view. Ultimately, it comes down to personal risk tolerance and asset allocation. U.S. equities are more mature with stable mechanics; A-shares have seen stronger state intervention lately to reduce volatility, minimizing the wild booms and busts of the past—the market structure has changed.
Crypto is far less mature, structurally unstable, and the game changes every cycle. Long-held beliefs like the “four-year cycle” or “altcoin diamond hands” have mostly failed this round. Strategies that worked last month fail this month. Because crypto is earlier-stage and less mature, its rules constantly evolve—you must constantly challenge assumptions. Models that once profited may suddenly break; strategies need rebuilding; trading experience gets continuously “deconstructed.” That’s perhaps crypto’s most unique trait.
Your Most Profitable/Losing Trade This Year – Lessons Learned
TechFlow: Both of you have captured notable opportunities this year—as visible from public social media positions. Now, share with us: whether in crypto or stocks, what’s the trade that left the biggest impression on you this year? Any new insights?
XinGPT: On equities, I’m still a beginner—started buying crypto-related stocks like Coinbase around 2023, extending from my crypto knowledge. Later, I began looking at Tesla, Google—big tech firms I interact with daily—and reference views from U.S. equity bloggers and Frank. Equities move more steadily, so this year I focused mainly on Big Tech. I also held a bit of Palantir. But I’m unfamiliar with small- and mid-cap U.S. stocks. During the DAT rally, I played BMNR, Strategy, etc., got lucky, rode the beta wave from Big Tech gains—I’m satisfied.
Crypto is completely different—much harder. As mentioned, the rules change too fast, experience gets overturned. My first bull run was 2021, when “diamond hands” worked perfectly: spot a theme, buy, hold until it hits a major cap range. The market rewarded trend-spotting and storytelling. There was also the “second-leg opportunity” post-exchange listing. Last year, much of my profit from small exchanges came from second-tier coins—mature but low-cap assets that jumped from $20–30M to $100–300M. Early Meme participation also paid off. I’m not a day-trader; by the time I noticed, many were already 10x up, yet I still profited—that’s how easy last year’s market was.
But after March–April this year, crypto’s difficulty spiked. Two main reasons: First, the rebound was weaker than equities. After massive altcoin collapses, most couldn’t recover to April’s pre-crash levels. Only Bitcoin and a few strong alts (like Hyperliquid) bounced back; most coins died. Too many exchange listings created huge supply, worsening holding experiences. Second, after October 11, liquidity collapsed. Clearly: altcoin liquidity evaporated, even large-cap coin liquidity dropped—depth for BTC, BNB, etc. fell short of prior levels. The whole sector entered a liquidity crunch. In such conditions, heavy positioning is hard, so many shifted to stocks and reconsidered asset allocation.
Gold and tech strength also pressured comparisons. Bitcoin’s “digital gold” narrative faces a key hurdle: governments can’t add BTC to national reserves. Gold is already in reserve systems, so amid rising global uncertainty, gold absorbed significant capital. Combined with sustained strength in AI and Big Tech, Bitcoin’s returns looked unimpressive.
To sum up: crypto gameplay shifts too fast; PvP is too hard and prone to losses; Big Tech and gold offer more stable holdings, lower volatility, clearer strategies, and significantly higher Sharpe ratios. Thus, traditional markets are actually easier—though some do make big crypto gains via DEX, IPOs, or ultra-early Meme plays. But those require extreme skill. For ordinary people unwilling to endure high-difficulty trading, buying gold isn’t bad—its returns are actually decent. So this requires self-reflection: what’s your trading scale, where are your strengths?
TechFlow: You mentioned gold earlier, and previously called ZEC “underground gold.” What’s your logic? Why did you see ZEC as a good opportunity?
XinGPT:
The logic is simple, two main points.
First: external validation. To my memory, only ZEC received a clear public endorsement—Naval’s shoutout. Even Bitcoin didn’t get that. That struck me.
Second: tech industry sentiment. I noticed Googlers mentioning ZEC publicly. Checking on-chain data, I saw ZEC’s private transaction volume clearly rising. Putting it together, I felt ZEC was overlooked. In my view, its potential should exceed XMR, which had no vocal support and faced increasing compliance pressure.
So I reasonably expected 4–6x for ZEC. An 8x run would rely on marginal buyers—maybe crypto capital inflows, sentiment, or herd behavior. Post 4–6x gains were more “emotional spillover”—why I didn’t add more. The logic wasn’t complex, admittedly with luck involved. Holding experience resembled stocks: you see a promising sector, capital flows in, price rises. Valuation or fundamentals are hard to judge as over/undervalued, but at least not cheap. Sustained inflows create a clear uptrend on charts, pushing prices higher. This differs from traditional crypto playbooks.
Looking at top performers this cycle—BTC’s ETF-driven rise was fueled by institutional buyers: MicroStrategy, quant funds, ETF flows. But why has it stalled recently? Data shows: miners are dumping heavily, OG wallets keep selling. Earlier, institutions and ETFs absorbed supply, limiting BTC’s rebound over six months. Now institutions can’t absorb more—MicroStrategy buying slows, ETF inflows ease, but selling pressure persists—so price naturally drops. This phase leans more on “external logic”; internal crypto advantages are largely exhausted. ETH is similar. Whether at $1,800 or $4,000, fundamentals haven’t changed. But after rising, holders have lighter bags, minimal selling pressure remains (most already sold), so price moves are driven more by external capital than fundamentals.
Frank: I fully agree with Jiang’s points. My overall sense is the same—market strategies are evolving faster than ever. Familiar tactics, models that worked for years, have rapidly failed in the past two years. For example, in 2021, betting on L2s or specific public chains yielded solid returns. In 2023–2024, I applied that same mindset to altcoin sectors, but by mid-2024 it clearly wasn’t working: limited liquidity, higher volatility, small caps spike then collapse, unable to sustain.
Last year I wrote many threads on my shifting views on altcoins. The conclusion was simple: the market has changed.
Reasons: 2021–2023 saw primary markets inflate valuations too high. Project quality isn’t as strong now. Two consecutive cycles driven by “narrative rallies” without real-world adoption damaged market confidence. Post-ETF approval, traditional capital flooded in, subtly changing market structure. More mature capital means a more “efficient” market; efficient markets naturally fragment—just like U.S. equities, which evolved from inefficient decades ago to today’s highly differentiated, efficient market. So my view: Crypto will further fragment; we’re already in a high-fragmentation phase.
From another angle, I agree with Jiang: we’re not day-trading types. We prefer logical, directional trades—buy, hold, even “diamond hand.” But this cycle punishes diamond hands severely, unlike the last. Even I performed poorly on small-cap secondaries. Last year I realized this, so I reduced altcoin exposure, focusing on fewer sectors and names—but results were mediocre. So my current strategy: Allocate major positions to foundational assets, mainly majors; rebalance when risks emerge; use minor allocations to chase trends—if I catch them, great; if not, wait.
On U.S. equities, my logic remains fundamentals and long-term direction. My most memorable trade last year was Palantir. I first noticed it through AI, realizing AI must land in “applications.” Palantir served the U.S. military since 2009, gained fame for locating Bin Laden, and has long-term partnerships with DoD, CIA, and armed forces. Once such software is entrenched for over a decade, replaceability is extremely low. In 2023, Palantir aggressively pivoted to AI, developing both models and real applications. Crucially, from H2 2023, financials finally showed an upward trajectory—unlike previous years. My core thesis stemmed from the Ukraine war: drones, unmanned ships, robots accelerating weaponization, reshaping future warfare. So I defined Palantir as: “The largest future weapons contractor—the software version of Lockheed Martin.” Reality later validated this: if the direction is right and execution strong, holding makes sense.
Another standout this year was Robinhood. I held a small position before, but started adding in April. Its strategic direction was clear. Historically a retail hub, in 2023–2024 it made aggressive acquisitions: Bitstamp, a UK crypto exchange, a Canadian Layer 2 team—showing deep commitment to crypto. Also, it launched short-term wealth and investment products. This led me to repeatedly compare it with Coinbase in Q1–Q2. Then, Robinhood was ~$30B, Coinbase ~$40B; Coinbase PE ~20x, Robinhood ~30x. Overall, I saw room for both, but Robinhood had greater “elasticity.” What impressed me most was the team’s “wolf mentality” and timing. When the “asset-on-chain” narrative emerged in July, they immediately launched a “property issuance” concept. Though essentially uniform CFD logic, they understood: the key isn’t product details, but seizing narrative ground. In Q3, they rolled out prediction markets and event contracts—data isn’t huge, but growth and search volume are strong. All very impressive.
Overall, my U.S. equity assessment:
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If fundamentals are sound, buying at reasonable valuations typically leads to good holding experiences.
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Medium-scale macro shocks can be ignored—U.S. equity fundamentals are strong enough to withstand such volatility.
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But for major risks (e.g., early 2025 Trump policy uncertainty), prudent hedging is needed.
Fundamentally, the past two years saw all U.S. capital crowded into Big Tech—a “passive congestion” driven by AI. We’ve benefited from this trend. The two U.S. stocks I mentioned are ultimately beta plays, moving with industry, macro, liquidity, and policy.
Why Did Crypto Underperform Stocks and Gold Amid Rate Cuts and QT?
TechFlow: This year, various markets performed well—U.S. equities, A-shares, gold—all delivered strong results. While some niche crypto projects stood out, overall, crypto underperformed other asset classes. Why? Especially as the market widely expects rate cuts starting October, continuing into next year, while the Fed simultaneously runs QT. Logically, these should benefit risk assets. Yet crypto hasn’t followed. How do you interpret this weakness? And what’s your outlook for upcoming markets?
Frank:
First, why has crypto performed poorly this year? Need to understand from a macro view. Since 2024, crypto’s overall beta has underperformed other markets. As Jiang noted: BTC hasn’t outperformed Nvidia this cycle. These are the iconic “cover assets” of their respective markets—newcomers see BTC in crypto, Nvidia in U.S. equities. Side by side, BTC lags.
Within crypto, the core issue is weak fundamentals. Bitcoin is fundamentally a consensus asset—like gold, yet with risk asset traits—a hybrid “majority asset.” Its price is driven by macro, capital flows, and sentiment. Favorable macro brings inflows; weakening macro reduces them.
I’ve framed mainstream coin movements around “large-scale turnover.” Buyers: ETFs, corporations, traditional institutions—they buy BTC, ETH, SOL, and now even ZEC (e.g., Naval). Sellers: on-chain whales, early investors, swing traders. When prices reach new highs, OGs trigger sell-offs, cashing out profits. Thus, major coins show classic “stepwise rallies”: climb, pause, retrace, climb again. Prices reflect ongoing buyer-seller battles.
Further, crypto is highly dependent on macro direction. Will policy be loose or tight? Is liquidity expanding or contracting? Are net inflows positive? These directly impact prices. The past two years were globally “big years”—strongman politics intensified, uncertainty soared. “Heaven’s will is unpredictable”—you simply don’t know what powerful leaders will do next. Emotional policymaking causes wild swings, and higher volatility makes trend formation harder in crypto.
Beyond that, I believe crypto has entered a clearing phase—perhaps even a “crisis of faith.” From 2017 to 2021, markets were driven by trends and narratives—stories and imagination. But after seven or eight years of storytelling, relying solely on narratives now reveals market fatigue.
In contrast, U.S. markets, though trend-driven, eventually demand performance. Stock prices can rise on expectations, but EPS must eventually materialize—or valuations collapse. The U.S. market’s long-term structure is healthier: from IT, semiconductors, to software, internet, mobile internet, now AI—trends expand valuations, then profits “fill in” the valuation. That’s why Big Tech’s multi-year rally is still seen as “reasonable.”
For example, people say Big Tech is overvalued, but check fundamentals—revenues of tens or hundreds of billions annually, profits of tens of billions. PEs around 30x, but growth also 30%. As per a Wall Street fund manager’s rule: if PE divided by growth rate (minus 2%) is less than 1, it’s a growth stock. Many U.S. tech stocks fit this now. Even Robinhood, at 60x PE, grew 69% YoY in Q3—by the “PE = growth” standard, its valuation is still below growth.
Why are U.S. equities persistently strong? Beyond solid fundamentals, a key factor: massive buying power from corporate buybacks. Over the past two years, U.S. equity buybacks exceeded $1 trillion annually. Apple, for example, has repurchased nearly $600 billion since 2017—eliminating 15–17% of float. Shrinking float creates “positive value injection,” naturally strengthening winners.
Now look at crypto—current misery (especially alts)—is necessary. Most projects perform terribly, holding major coins feels poor, but this is a prelude to industry evolution. The market must purge inferior assets before rising anew.
Primary markets are forced back to reasonable valuations. Previously, quality projects raised $100M angel rounds, $500M–$1B after two rounds, listed at $2B. Such valuations in traditional internet require solid data; Web3 projects often lack business backing. Now compressed valuations signal market self-correction.
Meanwhile, focus returns to fundamentals. HyperLiquid’s performance, BNB’s stability—these stem from buybacks and real economic models. Among top DEXs, AAVE outperformed UNI this year due to buybacks. Despite UNI’s high volume and fees, if tokens don’t capture value, prices stay weak.
A deeper issue: Past project teams had extreme power-responsibility mismatches—huge power, minimal accountability, high moral hazard. Post-funding, they acted like kings; post-listing, like emperors—changing promises to investors and communities at will, motivated only by selling tokens, not building. This model is unsustainable.
Recently, a16z suggested ending crypto’s “foundation model.” Concentrated power, blurred responsibility—like “feudal lords.” Future models should be more modern, transparent, linking tokens to business, accepting oversight, decentralized power, governance resembling public companies. Once new models emerge, crypto may undergo major restructuring.
XinGPT:
I fully agree with Frank—I raise both hands in support. Let me add a perspective I heard recently.
Last week, economist Fu Peng shared some insights I found illuminating. He follows crypto, so his view reflects how traditional finance compares “crypto vs. stocks.”
His framework resembles Frank’s—he splits asset attributes into “numerator” and “denominator.” Denominator: valuation, common to all assets. Numerator: earnings, which all assets should have. The problem with crypto: its “numerator” is undefined. Bitcoin has no earnings model—you can only assess valuation. So from a traditional finance allocation view, ideal assets see both “valuation and earnings” rise—classic “double-digit surprise.”
That’s exactly what’s happening in AI now. We think Palantir, Nvidia are expensive, yet each quarter delivers brighter earnings, beating expectations again. You think it’s peaked—next quarter exceeds again. Then they reinvest profits into data centers and R&D, pushing future earnings higher. The loop is: earnings growth lifts valuation, valuation fuels investment, investment drives earnings. Investors fully buy into this virtuous cycle.
Crypto is entirely different. Crypto valuations rise, but without earnings support, and valuations aren’t low. From a capital view, crypto prices react almost purely to liquidity—highly correlated with short-term rates and liquidity. So when liquidity tightens and short rates spike, crypto plunges—because it lacks an “earnings anchor.” That’s why different assets, different fund managers, make vastly different allocation decisions between crypto and stocks.
Looking back at 2021’s market-wide explosion, the logic was clear:
First, unprecedented monetary easing—pandemic, infinite QE.
Second, Bitcoin is the most liquidity-sensitive asset—when liquidity rises, it reacts fastest and strongest.
Third, no earnings constraints, no valuation ceiling.
Fourth, most people then knew nothing about crypto—only heard “Bitcoin,” “Ethereum,” unaware of base layers or governance—so narrative space was vast; Meta hyped metaverse to the skies, imagination limitless; combined with liquidity leverage, prices rocketed.
But now logic has changed—liquidity is tight, or barely easing but not truly loose, so risk assets broadly pressured; valuations, narratives, and earnings struggle to align; no fresh stories. Old stories can continue, but no one’s excited. Tom Lee recently strained to revive Ethereum’s narrative—he’s among the best storytellers online, yet it felt forced. In contrast, when Circle listed, Wall Street fully embraced it. They understood the story, saw profits, growth. Wall Street sees stablecoins as next-gen financial infrastructure—“crypto Swift” and “crypto Visa”—with far greater vision than crypto natives, who see stablecoins as “selling coins for fees.” So many U.S. equity bloggers call Circle a decade-long theme, suitable for long-term dollar-cost averaging.
This highlights a core point: New narratives + realized performance + risk-tolerant capital = a story that holds outside crypto circles. That’s why I think ZEC rose. It told a “new story”—privacy. Once viewed negatively, privacy coins now align with mainstream discourse on “privacy rights, sovereignty.” Plus, ZEC had been “written about for long”—any capital inflow creates huge leverage; combined with growing on-chain data, these factors resonated.
So today, when evaluating crypto, don’t just stare at on-chain data or price—mentally place every token in your U.S. equity watchlist. Look at Coinbase, Strategy, Circle, then Nvidia—now ask: if ZEC were a U.S. stock, would you buy it? Is it worth it? If yes, then buy.
What Key Metrics Should You Watch in Crypto and Stocks?
TechFlow: Looking forward from now, what data metrics will you focus on? What factors will critically influence future pricing or trends? What variables concern you most? Overall, are you more Bullish or Bearish on these factors?
XinGPT: I’ll start with crypto, which I know better. For me, the core is ETFs—both inflows/outflows and miner selling pressure—still a liquidity博弈 game, fundamental level. Beyond that, watch for new narratives or new external capital sources. For example, could a medium-to-large country add Bitcoin to national reserves? El Salvador is too small—no real buying power. Bitcoin’s market cap is now in trillions—only nations with fiscal scales of hundreds of billions to trillions, allocating 1% as reserves, would bring decisive incremental demand. Kazakhstan has hinted, but its size limits impact, and speed is uncertain. Ultimately, watch policy winds from China and the U.S. So in crypto, I focus on: policy developments, macro environment, on-chain capital behavior, and ETF inflow-outflow balance.
On stocks, I’ll defer to Frank. Personally, I prioritize earnings. Did reports meet or beat expectations? Is the trend upward? Also check industry scale and logic. Many U.S. sectors now exceed expectations—energy, power, nuclear—many not yet operational, rising purely on expectations; miners haven’t opened, but AI drove demand. The key is timely execution—even without immediate profits, clear milestones must be verifiable.
Overall, crypto trading is indeed far harder. You must monitor on-chain, charts, macro, secondary markets, regulation—too many inputs. Stocks are simpler: no major macro issues, check earnings reports, catch thematic trends—logic is clearer. Yet many stay in crypto because, as we said—starting with little capital, crypto offers better turnaround odds. Low entry barrier—its biggest advantage.
Frank: Building on “why stay in crypto,” I think it boils down to one principle: circle of competence. Most of us first encountered investing through crypto—trading coins, primary investments, ICOs, MemeCoins, majors, derivatives—that’s our most familiar market. Yes, it’s tough now, but doesn’t mean no opportunities. Ask me to restart in a completely foreign field? I’d rather deepen expertise where I’m familiar, find my real edge.
Take a friend (a well-known Twitter trader)—excellent at charts, patterns, technical analysis, hugely successful across large and small crypto coins. Last year he tried switching to U.S. and A-shares, but found it a totally different system. U.S. equity logic holds, but needs time—three to six months to realize, not crypto’s “enter today, up tomorrow” feedback. This caused anxiety, declining performance. Eventually he realized: stick to your strongest market, wield your sharpest blade—no need for tricks, master one move and dominate. So asset comparison matters, but more importantly: what suits your personality, competence, cognitive structure.
Back to “key future indicators,” I focus on macro. Separate short-term and long-term.
Short-term, I watch two things:
First, when will the U.S. government shutdown end? This was my earliest Twitter thesis in October: shutdown means Treasury can’t spend normally, monetary injection stalls, liquidity tightens instantly. Treasury spending is a key liquidity source—shutdown equals “valve blocked.” Resuming operations and spending will sharply ease liquidity.
Second, early December Fed halts QT (quantitative tightening). Ending QT will greatly relieve liquidity stress.
Once liquidity eases, the next key is: can inflation (CPI, PCE) stay below or meet expectations? Labor market weakness is consensus; the only unresolved variable is inflation. If inflation keeps falling, the Fed can keep cutting rates, preserving dovish expectations. Recent market correction—drops in equities and crypto—largely stem from tight liquidity, plus the Fed’s October rate cut paired with hawkish forward guidance, dampening dovish hopes.
So where are future opportunities?
I believe if inflation stays below or meets expectations, rapid liquidity improvement will continue. If inflation exceeds expectations, short-term pain. But over 2–3 months or a quarter, I still expect inflation to fall. Logic: this inflation stems from “cost-push”—tariffs feeding into goods prices—not “supply shock.” Only supply shocks cause true inflation spikes.
Historical spikes: 1970s Middle East wars causing oil embargo, 2022 pandemic disrupting supply chains—both supply shocks. This U.S. inflation is merely cost-driven, causing temporary rebounds. CPI/PCE use year-on-year and month-on-month comparisons, so “base effects” naturally ease it. Absolutes: U.S. prices have risen over 3x since the 1970s—basic fact.
Second, controlling inflation is a political imperative for the Trump administration. We discussed: U.S. tariff “effective rate” rose from 3% to 13%, generating ~$300B fiscal revenue. But banks estimate: one Fed rate cut saves ~$300B in U.S. debt interest. That’s why Trump pressures the Fed so hard—first threatening to fire Powell, then attacking “Fed building renovation overruns,” accusing Powell of mismanagement, then pressuring Fed governors... Core reason: fiscal consolidation.
Fiscal consolidation means “revenue increase + cost reduction”: revenue via tariffs; cost reduction via lower borrowing costs—the key being rate cuts. With Powell leaving next year, a new Fed chair likely announced in December, probably aligned with Trump. So I believe if October or November inflation meets or beats expectations, asset prices will enter a favorable phase. If worse, short-term pressure, recovery delayed to Q1–Q2 next year.
Broader logic, two core points. First, U.S. “Fiscal Expansion 2.0.” Since 2022, the Fed tightened policy (rate hikes, QT), yet markets rose—especially 2023–2024. Driven partly by AI wave, partly by fiscal expansion. Biden’s three laws—Inflation Reduction Act, Infrastructure Act, CHIPS Act—formed Fiscal Expansion 1.0, supporting 2023–2024 markets. The July-passed “Great America Act” is Fiscal Expansion 2.0. Current market liquidity stems less from monetary policy, more from fiscal action. Fiscal stimulus is slower than monetary—flows from government to firms to households to markets—longer path, but still “money printing.” The current shutdown froze many Great America Act policies—tax cuts, deregulation—unable to land. If government resumes, policy restarts, it’ll be critical—this is the market’s overarching logic.
Second major macro point: “China-U.S.” This is a political economy era—core conflict is China-U.S. competition. Short-term, I’m cautiously optimistic: the recent China-U.S. meeting is a “one-year ceasefire.” Relations will ease temporarily, though unlikely to last full year—new conflicts in months or half-year are normal. Both sides know decoupling is irreversible, structural contradictions irreconcilable, yet reality demands interdependence: China needs U.S. chips, high-tech, consumer markets; U.S. needs Chinese rare earths, critical minerals, manufacturing. Neither dares abruptly sever supply chains—U.S. would face instant “embargo-level inflation.” So current state is “fighting without breaking”—constant surface conflict, no total rupture. A ceasefire, but also buildup before next clash. Future geopolitical games will intensify, uncertainty rise, market volatility grow.
Back to crypto, I fully agree with Jiang—this is the “large-scale turnover” I described. A “lonely, long-term turnover opportunity”—chips slowly shifting from OGs and retail to Wall Street. This is Bitcoin’s major cycle, where macro determines buyer strength. If ETFs sustain net inflows, buyers are strong; if inflows slow or reverse, market pressured. This is crypto’s key indicator. U.S. equities similar: watch fundamentals, especially now when Big Tech and AI firms have massive capex—investors will “closely track fundamentals.” Though “bubble talk” abounds, I believe AI is merely “expensive,” not a bubble, certainly not heading for collapse. Likely “multiple contraction,” not “logic breakdown.” But this means market tolerance for earnings misses will plummet—flaws harder to overlook. Future watch: can earnings keep exceeding, and will miss rates rise? If miss rates stay single digits or teens, market holds; if rise to 30–40%, earnings can’t match valuations, logic weakens, shift from “kill earnings” to “kill logic,” triggering broader panic. To me, this is the biggest future risk.
In summary, key macro drivers: inflation (determines market recovery timing), U.S. government restart timeline, structural uncertainty in China-U.S. relations, and policy volatility from Trump’s personal agenda. Crypto’s key metrics: liquidity, ETF net inflows/outflows, miner selling pressure, whether large-scale turnover continues toward institutions. U.S. equities’ key metrics: ability to sustain earnings beats, conversion of massive capex into revenue/profit, and whether miss rates expand.
From 'The Big Short' to Today: Non-Consensus Opportunities in Crypto
TechFlow: I recently rewatched 'The Big Short,' curious—why do a few people see truly “non-consensus” logic when the market unanimously looks one way? So the final question: today, many consensus views are repeated—Bitcoin’s cycle logic, market weakness amid rate cuts plus QT, etc. Are there any “everyone thinks so” ideas that you actually doubt or find questionable? Can you share your own “non-consensus perspectives”?
Frank:
I don’t have many “non-consensus views.” Start with ‘The Big Short.’ I just tweeted about Michael Burry—he nailed “macro event bets,” but often too early on “fundamentals bets.” His biggest win was 2007–2008 subprime crisis, but others: shorting Tesla too early in 2020, lost hundreds of millions; shorting ARK in 2021 too early; shorting S&P, semiconductors in 2023, again in early 2025—mediocre results. Now shorting Nvidia, Palantir—he bought puts in Q3, but Sept 30 price was lower than now, so shorts aren’t profitable yet.
Bigger issue: his logic itself is flawed. He compares current massive capex to 2000 internet bubble, but then many firms had no revenue; today’s Big Tech consistently beats earnings. He compares 2018 cloud’s 40% growth to today’s 20%, ignoring massive valuation differences: Amazon PE 60–70x in 2018, now 30x; Google even 20x. Valuations adjusted—not “valuation racing ahead of growth.” So Burry applies “past frameworks” to “present fundamentals,” causing bias.
But I still think shorting possible. Why? Macro liquidity is tight now; past U.S. equity gains included much “earnings-beat beta”—rose too much, now expensive; expense plus tight liquidity and macro shocks justify a “minor valuation correction.” To me, a 10% U.S. equity dip is minor—now down ~5–6%, maybe a bit more multiple compression, not his predicted cliff-like collapse. Real danger remains fundamentals—if quarterly reports broadly miss, especially AI leaders consecutively miss, then larger correction. Strong macro can’t save weak fundamentals; weak macro but strong fundamentals can endure—logic is that simple.
On Bitcoin, I personally believe “the cycle has indeed changed,” but not “cycles are gone.” I’ve told many: Cycles haven’t disappeared—they’ve shifted from past “four-year halving” to “macro-driven.” Past two years, BTC market cap closely tracked macro—macro sets rhythm. But macro-driven doesn’t mean no drops—it still falls when needed, just perhaps less severely. Each Bitcoin cycle’s drawdown has converged—from early 90%+, to 86%, 83%, 70% in 2022—likely smaller next time.
Current difficulty: economy at a “decision point.” New cycle not yet fully believed; old “four-year thinking” inertia is strong. Many macro investors think: “I won’t take the last baton.” Add October’s macro volatility, profit-taking and locking gains are natural. Liquidity pressure, emotional inertia—hence crypto’s misery. But this is a pivotal moment: if post-macro-improvement prices rally again, likely confirms “the cycle has truly changed.” A month ago I said: next 3–6 months are decisive—continue old cycle or launch new one. My bias: a new cycle may be emerging, truly “detaching from four-year theory,” no longer fully bound.
Analogy: gold after 2004–2011 surge, underwent 2012–2018 correction—over 50% drop, from $1,800+ to $1,100+, only rebounding in 2019. Bitcoin may enter similar phase. But ultimately, such judgment evolves—we can only watch. It’s more a “hypothesis” or “potential black swan direction.” For now, admit: cycle is changing, but how, when confirmed—needs time.
XinGPT:
One “non-consensus” thought I have: Everyone hunts alpha, but in today’s market, it’s better to “hold beta.” Recent short-term explosions—like Binance Life, ZEC—grab attention, many flaunt gains on Twitter. But calculate full-cycle returns, you’d likely do better “fully holding beta”—assets like Nvidia, Bitcoin with clear long-term trends. Long-term absolute returns likely surpass chasing alpha.
Why? Chasing alpha has two big problems: First, it consumes massive time, energy, emotional cost—constantly hunting info gaps, researching, monitoring, sourcing news. Second, genuine large-position opportunities are rare. In non-mega-bull conditions, you can’t bet big on alpha. Unless you’re back in 2022–2023’s deep undervaluation pits—SOL lows, BTC bottoms, early Meme, GPT-era Nvidia oversold—but now they’ve risen too much. Trying alpha now, betting big, you likely can’t hold—small volatility shakes you out, poor holding experience.
So I remind myself, and share: in today’s high-volatility, black-swan-dense market, play defensively—just hold beta. Preserve capital, wait for real crisis opportunities. Holding beta is already excellent. A friend earned over 200% in two years just holding Big Tech U.S. equities—outperformed most crypto traders.
Also: Always keep cash. My cash position is high now. Look at Buffett—cash at record highs. He avoids AI, doesn’t short AI, doesn’t bottom-fish AI—just stays out. He holds Japan’s five major sogo shosha, plus massive cash. Made me rethink: am I too low on cash? So I’m increasing cash, waiting for next crisis. Crisis will come—macro, crypto structural issues, or U.S. equity structural risks. Next quarter (Q4 or Q1 next year), if Nvidia or AI firms miss earnings, stocks may crash—classic multiple compression. Then, if you hold cash, whether to bottom-fish or wait, you’ll act calmly.
So core: survive longer. Market volatility is far higher than before—we never cared about “short-term rates” affecting crypto, now it matters hugely. What next? Tariffs? Fiscal? Unknown. Amid such uncertainty, maintaining cash reserves, tolerating 20–25% drawdowns, is crucial.
*Disclaimer: Opinions expressed by hosts or guests in this podcast are personal views only. This podcast is for informational purposes and does not constitute investment advice or recommendation.
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