Kelly Criterion: Optimal Allocation to Bitcoin

Stephen Perrenod is an astrophysicist and technology consultant with over 30 years of experience in high performance computing. He’s the author of two books on cosmology and has been writing and speaking about Bitcoin for a decade.

› https://x.com/moneyordebt

PARTNERS

🌳 Gain peace of mind with Onramp’s Multi-Institution Custody solution. Sign up with code BRAM to receive $150 in Bitcoin after your first deposit: https://onrampbitcoin.com/bram

🟧 Gemini’s Bitcoin Credit Card: Earn instant bitcoin rewards on every purchase with no annual fee. Sign up today to earn a $200 intro Bitcoin bonus: https://gemini.com/bram

🔐 Blockstream Jade Plus: The simplest and most secure hardware wallet on the planet - Get 10% off your entire order with code BRAM at https://store.blockstream.com

🔨 Stamp Seed: The safest way to backup your hardware wallet - Get 15% off with code BRAM at https://stampseed.com

PRODUCTS I ENDORSE

› Get 10% off a Bitaxe open-source Bitcoin home miner using code BRAM at https://shop.powermining.io/?ref=BRAM

› Buy Bitcoin in the EU 🇪🇺 via https://relai.me/bram and use code BRAM to reduce fees by 0.5%

🔔 SUBSCRIBE TO GET NOTIFIED

› https://youtube.com/@bramk⁠⁠

› https://x.com/bramk

🕑 TIMESTAMPS

00:00 - Introduction and Context of Bitcoin Bubbles

02:26 - Alchemy, Energy, and Bitcoin's Value

04:55 - Power Laws vs. Exponential Growth in Bitcoin

07:59 - Bitcoin vs. Gold: A Comparative Analysis

09:59 - Market Dynamics: Bitcoin's Correlation with Gold

12:33 - Understanding Bitcoin's Value Proposition

15:12 - Volatility and Long-Term Perspectives on Bitcoin

27:41 - Understanding Bitcoin's Value and Persistence

30:08 - The Kelly Criterion and Optimal Portfolio Allocation

35:05 - Risk Assessment and Cash Allocation in Investments

39:06 - Evaluating Historical Performance and Future Projections

44:31 - The Power of HODLing and Investment Strategies

48:27 - Mathematical Models and Future Price Predictions

55:37 - Understanding Volatility and Market Behavior

58:07 - Analyzing Bubbles and Market Cycles

01:02:42 - The Evolution of Bitcoin's Market Dynamics

01:10:39 - Predictability in Bitcoin's Price Movements

01:16:30 - The Future of Bitcoin and Market Predictions

ℹ️ EPISODE SUMMARY

Bram Kanstein and Astrophysicist Stephen Perrenod discuss Stephen’s latest findings from the Scientific Bitcoin Institute. Is the Bitcoin four-year cycle a myth? Stephen breaks down the Power Law math that dismisses traditional cycles and predicts a new timeline for future bubbles. We explore why Bitcoin grows 100,000x faster than gold, the "alchemy" of the Nakamoto consensus, and why the network effect makes Bitcoin a meta-network unlike any other asset. Stop looking at linear charts; the real signal is in the log-log.