welcome to money is freedom
a podcast
exploring how finance and freedom connect in our lives
created from thoughtful research
and narrated by Notebook LM AI
this series brings you clear
meaningful insights into finance and beyond
in today's episode 3 will make it clear
Bitcoin surging its dominance near at 73 grand
its hit the spot near all time highs
but now what
we'll dive into cycles liquidity tight
why Bitcoin shines in this kind of light
alt coins falter as dollars are cut
monetary shifts ahead but now what
whether you're seasoned or just taking a shot
join us to see what's next in the plot
navigate the cycles the twists and the knot
bitcoin soaring high but now what
hey everyone and welcome back for another deep dive
yeah it's great to be back
today we're going exploring the world of cryptocurrency
woo exciting
but with a twist a twist
we're gonna be talking about how cryptocurrency
is influenced by the Federal Reserve interesting
so today our guide is this article called Bitcoin
Cyclical Patterns
and the impact of Monetary Policy on alt coins
okay by chaos of money
all right um
and so
I'm sure most of our listeners have heard of Bitcoin
right but have you ever noticed that
it kind of goes through these like
boom and bust cycles yeah
and then we have all these other cryptocurrencies
like alt coins yeah
and it seems like sometimes they just explode in value
out of nowhere it really does seem random
yeah sometimes
so what's fascinating is that these two worlds
that seem very separate yeah
are actually really connected
yeah and the feds actions
like adjusting interest rates
and controlling how much money is circulating
have a surprising impact on these crypto cycles
yeah so let's break the stone first
can you tell me about this Bitcoin
four year cycle thing yeah
so the article mentions these having events
okay
where the reward for mining bitcoin gets cut in half
every four years so imagine that you're a gold miner
and every four years
the amount of gold you find in each nugget
gets cut in half okay
you'd have to work twice as hard to get
the same amount of gold right
well
that's essentially what happens with Bitcoin having
oh wow it creates this predictable pattern of scarcity
and as you know yeah
historically when something becomes scarcer
its value tends to rise right
supply and demand exactly
so left bitcoins entering the market
yeah and then boom
the price goes up yeah
but the article dies a little bit deeper than that
okay and talks about bitcoin dominance years okay
what's that all about so
the article
kind of breaks the 4 year cycle down even further
okay and suggests that there are certain years within
the cycle where Bitcoin tends to outperform
um so it suggests that the midterm pre having
and the having year itself are when
bitcoin kind of rains supreme
so it's Bitcoin's time to shine
yeah during these years
yeah and then it's outperforming all those old coins
right so
there are times when
it would be more advantageous to be bitcoin heavy
yeah in a portfolio
that's the idea the article puts forward
and this is where the Fed comes in yeah
so picture this
the Fed decides to tighten monetary policy
okay and essentially
they're like a giant vacuum sucking up liquidity
yeah out of the system right
so what happens then
well people get nervous
right and investors get anxious
and they tend to flock to
what they perceive as the safest asset
in the crypto world so bitcoin
bitcoin exactly
it's like the gold standard of crypto
yeah you could say that
so Bitcoin's dominance rises
during these periods of tightening
yeah but what about all those other cryptos
the alt coins yeah
when do they get their time to shine
so that's when we enter alt season
alt season yeah
okay and it's this period where all of sudden
alternative cryptocurrencies are alt coins
start to outperform okay
and it's typically when the Fed
loosens its grip on monetary policy
okay and pumps more money into the system
increasing global liquidity
so it's like the Fed is throwing a party
exactly and everyone's invited
everyone's invited especially those risky
more speculative old coins
especially those okay
yeah because when money is flowing freely
investors feel more adventurous
right and
they're willing to take bigger bets on less
established cryptocurrencies
so everyone wants to be the next bitcoin right
everyone wants to find the next big thing exactly
but the article mentions that it's not just the feds
actions that drive these altcoin rallies right
so sometimes
individual alt coins just have their own stories yeah
they have their own fundamentals
and they're the things that really drive the price up
okay so give me an example
um so let's take Ethereum
remember the Ethereum merged
that was a big event yeah
it was big news yeah
that was when they switch over from proof of work
to proof of stake right
and it made the whole system much more energy efficient
exactly and scalable yeah
and it LED to a huge price rally for Ethereum
even though
it happened during a period when Bitcoin was
generally dominating
so even in a Bitcoin dominance year
yeah an alt coin can still break out
if it has a really good story
right if it has strong fundamentals okay
so it's like a combination of
the macroeconomic conditions
yeah and internal project breakthroughs
right that cause these altcoin rallies exactly
it's not just about writing the waves
created by the Fed right
it's about identifying
the altcoins that are paddling the hardest
okay and have the most potential to catch those waves
out of it
the article also mentions this analyst named
Benjamin Cowan from
into the cryptoverse okay
and he's been tracking these Bitcoin dominance years
okay and what has he found
so his analysis has observed that
during Bitcoin dominance years
Bitcoin tends to attract the lion's share investment
and it draws capital away from alt coins
so it's like a tug of war yeah
between Bitcoin and alt coins right
and the Fed is like the referee
exact tilting the playing field
yeah that's a great way to put it
okay so let's get practical okay
what are some key takeaways here
for investors who wanna navigate the crypto world
first timing is everything okay
if we are in a bitcoin dominance year
as Cowan suggests we might be yeah
it might be wise to lean towards Bitcoin okay
so if the Fed is tightening and the economy feel shaky
bitcoin is the safe haven
that's the idea okay
bitcoin is like that sturdy
oak tree that weathers the storm right
while those more delicate
alt coins might get blown around a bit okay
but even during those bitcoin heavy times yeah
if I am interested in alt coins yeah
I should look for projects with strong fundamentals
exactly so remind me what is a strong alt coin
imagine you're looking at a company stock okay
you wanna see real world use cases
you wanna see a solid team behind it
okay and
you wanna
see evidence that the project is actually solving a
problem got it
don't chase hype
look for substance
so solid fundamentals over fleeting hype right
okay what else
pay attention to what the Fed is doing yep
they're like the conductors of the economic orchestra
okay and their actions send
ripple effects throughout the markets
so what should we be watching for
keep an eye out for things like interest rate cuts
and balance Xi expansions okay
these are signs that
the Fed is loosening its grip on the money supply right
and that tends to signal a potential alt coin season
so we should be checking the global liquidity index
regularly yeah
exactly got it
the article also mentions something called
thinking in Bitcoin terms yes
what does that mean so
instead of just looking at an alt coins price
in US dollars what can be deceiving okay
you should analyze it in relation to Bitcoin okay
so give me an example
let's say an alt coins price is going up in dollars
it might seem like it's performing really well right
but then when you check its price chart against Bitcoin
yeah
you notice it's actually flatlining or even declining
so what does that tell me
it means that it's not actually gaining value
oh it's just being pulled along by
Bitcoin's overall market movement
so it's not really performing well on its own
exactly it's just being kind of propped up by Bitcoin
yeah it's like a boat being lifted by the tide
rather than powered by its own engine
oh that's a good analogy yeah
so thinking in bitcoin terms
can be a very powerful tool
okay so we've got these four year bitcoin cycles
driven by these having events right
we've got
the Fed playing a surprisingly influential role
in crypto markets yeah
and we've got some
actionable advice here for investors
to help them navigate these cyclical patterns
it's all connected yeah
and it can get very complicated
yeah definitely
but this is just one perspective right
one deep dive into a very complex world
you know what they say the more you learn
the more you realize you don't know exactly
um but speaking of going deeper yeah
I understand that
chaos of money also has their own podcast
they do it's called money is freedom
and I bet they dive even deeper into this stuff
oh yeah
on their podcast much deeper
okay so I'm gonna have to check that out
yeah definitely recommend it
but before we wrap up this part of our deep dive
I wanna leave our listeners with a question
okay so
the article that we've been discussing
mostly focuses on the US Federal Reserve right
but we live in a globalized world absolutely
so what about all the other central banks
yeah could their monetary policies also be
impacting the crypto market
that's a good question maybe even counteracting
or amplifying what the Fed is doing
yeah something to think about
definitely something to think about
so we'll pick up this thread in Part 2 of our Deep Dive
sounds good where we'll be exploring some more
practical applications of this knowledge
excellent and offer some more tips
for navigating the cryptomarkets
so be sure to tune in for Part 2 of our Deep Dive
we'll see you there and in the meantime
happy exploring yeah
stay curious out there right
see you there bye
so it's like
we zoomed out from looking at just one country to
like the whole world map right
and suddenly we see all these other players yeah
all these other central banks with their own
monetary policies yeah
that are all potentially
pushing and pulling on the crypto market
in different directions I never thought of it that way
yeah it's a lot to take in
it's like a giant tug of war
with multiple teams and shifting alliances
yeah exactly
so how do we make sense of this global crypto puzzle
right where do we even begin
well let's bring it back down to earth for a second
okay um
imagine you're a listener
who's just starting to explore crypto okay
what are some key takeaways for you
it can feel overwhelming right
oh def
especially when you're first starting out
and you're hearing all this stuff about bitcoin cycles
and the Fed and global liquidity yeah
but here's the thing what's that
knowledge is power and
the more you
understand about the forces that are driving
the crypto market yeah
the better
equipped you'll be to make informed decisions
so where do we even start
well first and foremost
remember that timing matters okay
bitcoin tends to have these periods of dominance right
especially when the Fed is tightening monetary policy
and the global economy feels a bit shaky
okay so if I'm feeling riskiverse
yeah bitcoin might be the way to go during those times
yeah it's often seen as a safe haven asset
okay kind of like a digital gold right
but even during those bitcoin heavy periods
yeah it's worth keeping an eye on alt coins
especially those with strong fundamentals
okay so remind me
what should I be looking for in an alt coin
to know that it's a strong alt coin
think of it like you're evaluating a company okay
does the alt queen have a real world use case
yeah is there a solid team behind it
actively developing and improving the technology
got it and does it actually solve a problem
or fulfill a need in the market
so it's not just about jumping on the hype train
no it's about doing my research
exactly and
finding projects that are
building something meaningful right
and don't be afraid to dig deep okay
read white papers explore the technology
and really understand
the problem that the project is trying to solve
it's like being a detective yeah
piecing together clues to uncover the hidden gems
exactly and remember
patience is a virtue okay
the crypto market is still young
yeah and it takes time for these projects
to mature so no overnight riches
it's more like planting a seed
okay and nurturing it over time okay
I like that analogy yeah
the most rewarding investments
are often the ones that require patience
and a long term perspective
got it so we've got risk management
we've got diversification
we've got strong fundamentals
right and patience
yeah what else
well don't forget about those cyclical patterns
we talked about right
those bitcoin dominance ears yeah
remember
bitcoin tends to have those periods of dominance yeah
especially when the Fed is tightening monetary policy
those might be good times to lean towards bitcoin
okay or to consider taking some profits off the table
right and then when the Fed is loosening
and global liquidity is increasing
that's when alt coin season is more likely to heat up
so
we need to be both fundamentally sound and macro aware
exactly it's a delicate dance
yeah but with practice
you can become much more confident and successful
okay I like that
so we talked about the Fed
yeah and obviously
we can see how their monetary policy can
impact the crypto market right
but what about the actions of other
central banks around the world right
could that also be
creating some opportunities or challenges for us
so
let's imagine for a second that the Fed is tightening
okay but the European Central Bank is loosening
so they're moving in opposite directions
exactly okay
what would happen well
it could create a scenario
where capital flows out of dollar denominated assets
and into euro denominated assets
and that would potentially boost the euro's value
relative to the dollar okay
so how does that impact crypto
we'll remember that bitcoin
and other cryptocurrencies are traded globally right
so if the euro is strengthening against the dollar
it could make
bitcoin more appealing to European investors
right and drive up its price in euros
so even though the Fed is tightening yeah
the actions of another central bank
could be pushing Bitcoin's price
in a totally different direction
exactly wow
it just goes to show that
the crypto market is incredibly complex
yeah and it's influenced by a multitude of factors
right including
this interplay between different central banks
it's like
we're trying to understand the weather patterns
of a global economy yeah
with all these different winds and currents
yes Ukraine analogy
pushing and pulling in different directions
and just like predicting the weather
yeah understanding these macroeconomic forces
can help us anticipate potential shifts in the market
right so
it's not just about understanding
bitcoin's four year cycle
right or watching the Fed
it's about understanding the global system
it's a lot bigger it's much bigger than that yeah
okay so we've covered the technology
we've talked about these macroeconomic forces right
but what about the human element
yes of the crypto market
well cryptocurrency is ultimately driven by people
right by their beliefs and their fears and their hopes
it's easy to get lost in the church and graphs yeah
forget that there are real people yeah
that there are real people behind all of this
with their own investment goals yeah
so how do we factor that in
I think it's about approaching the market
with a blend of analytical thinking okay
and emotional intelligence
what do you mean by emotional intelligence
in this context
so we need to understand the technical aspects oh
the cycles the monetary policies yeah
but we also need to be aware of
the psychological factors okay
that can drive market sentiment
so you get to kind of balance the head in the heart
exactly the logic and the emotion
and maybe even more importantly
recognize that we don't have all the answers
this market is constantly evolving
is throwing us curve balls
and challenging our assumptions all the time
so we have to stay humble yeah
stay curious
stay curious and be open to new information okay
so let's take a minute and reflect we've covered a lot
we have we've explored bitcoin cycles
the FIDs influence
the importance of strong fundamentals
the power of thinking in bitcoin terms right
global implications of central bank policies
even the psychology of the market
that's right
it's been quite a journey
it has been but the adventure isn't over yet okay
where we going next in the final part of our deep dive
okay we'll delve into some specific strategies for
navigating the crypto market alright
so we're gonna get even more practical
more practical yeah
drawing on all the insights we've discussed today
I like it so
stay tuned as we venture even deeper into this
fascinating world of cryptocurrency
alright so welcome back everyone
for the final part of our deep dive into Bitcoin
alt coins and the forces at play yeah
the forces at play yeah
um so we've covered a lot of ground here
we have we've gone over bitcoin's four year cycles
right the Fed's influence yep
the importance of having those strong fundamentals
absolutely we talked about thinking in bitcoin terms
we even touched on the global implications of
central bank policies and even the psychology
the psychology of the market yeah
so hopefully
everyone listening is starting to see
the crypto market with like fresh eyes
new perspective yes
new perspective for sure
and you're recognizing the interplay between
the technology
the economics and even the human psychology
it's fascinating isn't it
yeah and now
it's time to put all that knowledge into practice
okay let's do it
let's talk strategy no
so I'm ready to put on my little crypto Explorer hat
okay and venture out into this jungle alright
let's go what are some tools that we need to pack
in our backpack alright
so the first thing we need to talk about is
risk management okay
risk management this is your compass
that will guide you through the UPS and downs of
the crypto market okay
so the crypto market can be very volatile
very volatile
so how do I avoid making those emotional decisions
well rule No. 1
okay is never invest more than you can afford to lose
okay that's like the golden rule
yeah the golden rule of investing okay
don't bet the farm especially in crypto right
okay what else
so
another really important principle is diversification
diversification don't put all your eggs in one basket
okay so
spread your investments
across different cryptocurrencies
okay and also
consider allocating a portion of your portfolio
to more stable assets like stocks or bonds
so you're saying that my crypto portfolio shouldn't be
100% crypto exactly
it should be more diversified right
it helps to mitigate risk
okay and smooth out the volatility
so it's like a well diversified meal
exactly fruits
veggies and a little bit of dessert
a little bit of dessert but not too much
okay I like that analogy
yeah so we've got risk management in diversification
right
but how do I actually pick
which cryptocurrencies to invest in
well remember those strong fundamentals we talked about
right those are your guide okay
you wanna look for projects with real world use cases
yeah solid teams
active communities it's not just about chasing hype
yeah it's more about actually doing my research
yeah look beyond the hype
okay find the projects
that are building something meaningful
got it and don't be afraid to dig deep
dig deep read white papers okay
explore the technology really
understand the problem
that the project is trying to solve
like being a crypto detective
yeah piecing together all those clues
exactly to find the hidden gems
and remember patience is key
patience this market is still relatively young
yeah it's only been around for like a decade
exactly and it takes time for these projects to mature
and to reach their full potential
so don't expect to get rich quick
no think of it like planting a seed
okay and nurturing it over time okay
the most rewarding investments
are often the ones that require patience
and a long term perspective
so risk management diversification
strong fundamentals and patience
those are your guiding principles
alright
so those are my tools in my Crypto Explorer backpack
yeah exactly
I'm ready to go let's go
wait
you mention those bitcoin cycles
oh yeah
and the Fed should we factor that in
yeah absolutely
okay so remember
bitcoin tends to have these periods of dominance
yeah
especially when the Fed is tightening monetary policy
okay those might be good times to lean towards Bitcoin
okay or to consider taking some profits off the table
okay so
when the Fed is loosening
and global liquidity is rising
yeah that's when altcoin season might be coming exactly
okay keep an eye on those macroeconomic indicators
like the global liquidity index
right and watch for signals that
the tides are turning in favor of altcoins
so we need to be fundamentally sound and macro aware
you got it okay
it's a delicate dance it is
but with knowledge and practice
you can become a more
confident and successful crypto explorer
so we've Learned a lot today
we have about bitcoin about old coins yeah
about the Fed the global economy
about the global economy yeah
about the psychology of the market
we've covered a lot and hopefully
everyone listening feels a little bit more equipped
to go out there and navigate the cryptoworld yeah
go explore yeah
go explore stay curious and remember knowledge is power
yeah the more you know
the better decisions you can make absolutely
alright that's it for today's deep dive
thanks for joining us we'll see you next time
see you