rogerᵐᶠᵉʳ🌴

crypto's time to shine was 2010s/early 2020s which was the prime period for excess cash in the system to chase/speculate on non-productive assets and wasn't crowded out by more economically interesting alternatives (eg AI infra build out) during the 2010s/early 2020s crypto golden era: 1) low cost of capital (0-25 bps basically since the GFC in 2008) => money had to push out the risk curve to find returns 2) excess cash in the system had few places to go => low investment opportunity cost; the main cutting edge tech was SaaS which was light on capex needs and therefore didn't need to borrow much from capital markets as it could fund itself just fine on its own FCF flywheel 3) low inflation => no siphoning effect from increasing cost of living (which affects household excess income for speculation) and less need for companies to raise capital for productive purposes when cost of inputs isn't rising we now live in a completely different world 1) increasing cost of capital => much higher bar on sending capital to chase pure speculation 2) excess capital has many places to go => the AI buildout is a massive capital guzzler that can offer high ROICs on literally trillions of $ 3) high inflation => negative effects on household wealth effects (less money for non-essentials like speculation) and corporate input costs (more productive capital market activity for investors to chase)