If you spotted a gigantic crypto bubble in the late 2010s and early 2020s, how would you play it? Two obvious wrong answers:
–Short crypto. You’d have gotten carried out, multiple times.
–Long crypto. This is better — the George Soros “When I see a bubble forming, I rush in to buy” approach — but still risky (the bubble did pop) and sort of analytically unsatisfying.
And a pretty good answer:
–Take out absolutely bajillions of dollars of non-recourse loans to buy as much crypto as you can, selling enough along the way — and putting the proceeds somewhere your creditors can’t get them — to make yourself dynastically wealthy. Borrow $1 billion to buy $1 billion worth of crypto. If that turns into $2 billion of crypto, pay off your loans, take the extra $1 billion and bury it in your backyard, and do it again. If you do it again and it turns into $0 of crypto, walk away from your debts, dig up your backyard and buy yachts.
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