This bitcoin fund went up over 1,000%. Beware

Bitcoin BTCUSD,
+ 1.58%
in your IRA? Dude, that was so last month.

Sure, bitcoin is hitting new highs, and just breaking through $ 23,000. Okay, it’s up 200% this year. But bitcoin is old-school, man. This is the “OK Boomer” of crypto.

You should be “Aave.” It’s up nearly 10,000% this year. Or “Kusama,” which is up nearly 5,000%. Or “Protocol Band,” which is up nearly 3,000%. Or “,” about 1700%.

And don’t forget things like Celsius Network, ThornChain, Ocean Protocol and ThetaToken. They are all up about 1,000% this year.

Seriously, you were hoping to retire with bitcoin in your IRA? It’s just, like, the 37th best cryptocurrency of 2021. Even Ethereum ETHUSD,
+ 0.85%
up twice as much, 400%.

Ditto “OMG Network.” Ticket: OMG.

I am not making up for this.

According to, the world’s cryptocurrencies now boast a total of “value” – meaning price – of $ 639 billion.

Even more than a Tesla TSLA,
+ 5.96%,
if you can imagine. About three times as much as Pfizer PFE,
Hmmm, which one would I prefer? A third of the world’s cryptocurrencies, or all the stock in Pfizer?

Crypto is a great, great short-term trade. The momentum is crazy. And because no one can really appreciate these things, no one can say when it’s too high.

There is no point in discussing the “investment case” for bitcoin because it is unknown. Ditto the “value.” What we have now is the classic speculative mania, straight out of Extremely Popular Hypotheses And Crowd Madness.

Among the bubble stocks during the South Sea mania, financial historian Charles Mackay wrote, it was a company ”For carrying out an undertaking of great advantage; but no one knows what it is. ”

And if you don’t believe me, look no further than the stampede to Bitwise 10 Crypto Index Fund (OTC: BITW), a statutory trust, much like a closed-end fund, which became commercially available this month.

It’s a smart new fund. It gives you exposure to the 10 “largest” cryptocurrencies with a single click of a mouse (though bitcoin dominates). You can own it in your IRA, saving on all taxes and paperwork. And you can buy it through your regular broker. No setting up “wallets” and apps and trying to keep track of various “digital keys”. (I think I still own some “Ethereum” somewhere. Heaven knows where.)

The price plunged from $ 12 at the start of the month to $ 140 on Wednesday, before plummeting to $ 90 on Thursday. The fund was valued at its peak, theoretically, at $ 1.2 billion.

There is just one problem. It’s 85% air. No, really. The fund’s underlying assets are only $ 170 million, or about $ 20 a share. The remaining price rise is pure speculation, with no basis.

In other words: “ether,” not Ethereum.

“As of 3:12 pm ET, the fund is trading at $ 136 and the NAV estimate is $ 18.48,” Bitwise spokesman Matthew Hougan confirmed to MarketWatch Wednesday. “Publicly available fund shares can trade at a premium if demand for public shares exceeds the amount of shares available for sale,” he added. “Bitwise has no control over the demand for secondary market shares or the premiums or discounts.”

But certainly, the execution in this market all makes perfect sense.

Trading can be a lot of fun and you can make great money. Congratulations to everyone who is doing as a band. But never confuse a brain with a bull market. It’s all about gaming. Make sure you get out in time.