He Rode The Bitcoin Boom All The Way Up, And Down

Joe Weisenthal (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:16)

And I'm Tracy Alloway.

Joe Weisenthal (0:17)

Happy New Year, Tracy.

Tracy Alloway (0:19)

Oh, you're gonna make me say it. Happy New Year.

Joe Weisenthal (0:22)

Wait, is that something you hate saying?

Tracy Alloway (0:23)

I hate saying it.

Joe Weisenthal (0:23)

Oh, really? Okay, I'm sorry.

Tracy Alloway (0:24)

But no, I hate saying it, like, beyond the first day after New Year.

Joe Weisenthal (0:28)

No, that's fair.

Tracy Alloway (0:29)

Cause it just goes on and on and on for weeks.

Joe Weisenthal (0:31)

That's fair. It just felt like it's been a long time since we've recorded one together, cause we had the holiday disruptions and stuff. I was just very excited about getting back into the rhythm and doing another episode with you.

Tracy Alloway (0:43)

Right, we got the band back together.

Joe Weisenthal (0:45)

Exactly.

I'm also really excited about this one because we're going to return to one of our favorite topics, a recurring theme throughout Odd Lots. And that is Bubbles, which I think we would both agree is just an endless supply, a rich load to mine for topics to discuss in markets.

Tracy Alloway (1:06)

Absolutely, and a fascinating experiment in human psychology and how people react to making a lot of money and then losing a lot of money as well.

Joe Weisenthal (1:15)

Exactly. I mean, there are so many bubbles throughout history and each have their own sort of distinct element, but it seems like the psychology element of how humans react to huge price swings on the way up to people making a fortune in a short period of time is very consistent throughout basically every bubble.

We talk about, and in fact, you even see charts that are sort of like the cliche bubble of fear of missing out and optimism, and then people buy back in at the top. And there's a steady psychological component or cycle to every bubble that basically is identical.

Tracy Alloway (1:55)

Absolutely. So which particular bubble are we going to be discussing today?

Joe Weisenthal (1:59)

Well, today we're going to not only be talking about one of the recent most sort of extraordinary topical bubbles of our time. We're going to be talking, of course, about Bitcoin and crypto more broadly. We actually, rather than talking to some historian or some academic who's done a study, we actually have the good fortune of talking to someone who participated in the bubble on the upside and the downside, someone directly involved with it. So we can hear straight from the source what it's like to ride an extreme bubble.

Our guest today recently did a tweet storm in which he talked about starting with a very small amount of money and making an absolute fortune in crypto and most of it made in 2017, and then seeing much of it deteriorate in 2018 So we get to go right for the source, I would say on this one.

Tracy Alloway (2:57)

So I'm really excited about this one, particularly since it's Bitcoin, and Bitcoin, it's not just a bubble, right? It's almost a belief system. So I'll be really interested to hear what our guest has to say about whether or not he still believes in all things Bitcoin slash crypto.

Joe Weisenthal (3:13)

I agree, and I suspect he still does because with us today, we have Peter McCormack.

If you follow him on Twitter, he tweets a lot about Bitcoin still. He's also the author of his own podcast called What Bitcoin Did. So I'm confident on that last part. Peter, thank you very much for joining us and telling us about your experience.

Peter McCormack (3:35)

No worries. Thank you for having me on, and happy new year, Tracy.

Joe Weisenthal (3:41)

So Peter, tell us, how did you first get into Bitcoin?

Peter McCormack (3:46)

So really a couple of times. I first found it in 2013

I worked in tech, so I heard about it on, I can't remember the website, checked it out, looked kind of interesting, rode that bubble for kind of about a week or two. I was trading CFDs on plus 500, and made and lost a small amount of money in comparison to the last year, and then kind of forgot about it. And then in December 16, it's quite a sad story, sorry, but my mother was dying from cancer, and we wanted to get a certain treatment for her that was only available for purchase with Bitcoin. So I said to my dad, I can do this. So I went on to Google, did a search, found Coinbase, bought a Bitcoin, bought the treatment. Sadly, she passed away.