Issue #2: Buy a House with Just $16K—Yes, Really
Want to slash 80% off your electric bill? Learn to predict Bitcoin’s price using proven math? Or score 20% discounts from stores by doing almost nothing? Then, this week’s issue is for you!
Reading time: 7 minutes
Charts 2-Pack
The Theory That Accurately Predicts Bitcoin’s Future
A very important concept every investor should know is the Power Law theory applied to Bitcoin by Giovanni Santostasi.
Bear with me here, please. I promise it's important and valuable for you to know.
So, the Power Law describes Bitcoin's long-term growth trajectory and has shown how its price movements are predictable. It's scale-invariant, meaning that the same mathematical rules apply whether Bitcoin's price is low or high. It shows that as Bitcoin's adoption grows, its price tends to rise exponentially.
The pattern has remained consistent for over 15 years, and is visible when you plot Bitcoin's price on a logarithmic scale—it forms a straight line, indicating a strong Power Law relationship.
Why does it work?
It's because of network effects. The more people adopt Bitcoin, the more valuable it becomes. As the network grows, it reinforces itself, leading to exponential price increases.
The predictability isn't based on guesswork but on grounded mathematical principles, as well as how Bitcoin's adoption spreads and how its scarcity interacts with demand. The theory is so robust that it has accurately predicted Bitcoin's price growth over multiple orders of magnitude.
Based on the Power Law theory, Bitcoin could reach $1,212,799 by November 2033.
Holding 0.247155 BTC Puts You in the Top 5%
To be in the top 5% of Bitcoin holders, you only need to hold 0.247155 BTC or more. At a Bitcoin price of $65,000, that's roughly $16K. Now, let's pause for a second. It sounds like a lot, but is it really?
Bitcoin is not going to zero, and I'll dive into why in detail in the future—without the usual clichés. It might have been possible at some point, though even then, it was debatable. But now, with regulations taking shape and traditional finance entering the space, the likelihood is effectively zero. The landscape has changed.
Considering the Power Law graph and many other predictive models, your 0.247155 BTC today may feel modest. But in 8 to 16 years, that same amount could very well buy you a house without needing any downpayment.
Knowledge 2-Pack
Concentration Builds Wealth, Diversification Sustains It
If you want to get rich fast, focus on one or a few strong, quality assets. Personally, I think a concentrated portfolio should have no more than 5 assets.
Concentration is how the rich got rich in the first place (e.g. 1, 2, 3) Once they've built their wealth, they focus on diversification because, at that stage, the goal shifts to preservation and steady growth.
Every year is packed with investment opportunities, and your goal is to hunt down 1-5 biggest ones. You're looking for the fast horses—the ones with the potential to take you the furthest, the quickest. Focus on them, and let them carry you ahead.
How do you concentrate? Don't just throw your money at anything, and definitely don't bet on risky things like meme coins (e.g. SafeMoon)or deteriorating businesses (e.g. Bed Bath & Beyond). I know it sounds cliché but DO. YOUR. OWN. RESEARCH! Dive into every detail. Ask as many questions as possible. If anything feels off or if you find gaps in your research, dig even deeper. You need to understand the asset so well that you could teach a course on it.
Follow one simple rule: If you don't know everything about the asset, then you don't put money into it. At all. Never. Jamais. Nunca. Niemals. Mai.
Although beating the market isn’t impossible, beating it consistently is. 89% of fund managers fail to beat the market. If they can’t, how can you, right? Beating the market is hard because few actually put in the effort required to do it right.
Take META as an example: in October 2022, everyone was bearish. The stock dropped -77% to $87.83, and many ignored the fact that META still had access to billions of users (Facebook, Instagram, WhatsApp). Less than two years later, Meta rebounded to $590.51, delivering nearly a seven-fold return. FYI, the S&P 500 typically doubles every 7 years!
You know how much research it would take to spot an opportunity like this? Honestly, I’d say no more than 3 hours.
As legendary investor Peter Lynch said:
Any normal person using the customary 3% of the brain can pick stocks just as well, if not better, than the average Wall Street expert.
This is investing, where the smart money isn’t so smart, and the dumb money isn’t really as dumb as it thinks. Dumb money is only dumb when it listens to the smart money.
You only have to find one big winner out of eleven. The more right you are about any one stock, the more wrong you can be on all the others and still triumph as an investor.
Well-Timed Entries Minimize the Time and Effort for Loss Recovery
The reason I emphasize, “if you don’t know enough, never invest,” is simple—too many people jump in and out of FOMO, chasing quick money, only to end up holding the bag or losing it altogether.
Let’s look at Microsoft.
It topped right before the dot-com bubble burst at the end of 1999. Then it crashed. Do you know how long it took for Microsoft’s stock price to recover and reach that level again? 17 years—that’s right, 17 years to just break even. Imagine you could have had a kid and sent them off to college before your investment finally hit its original value. Of course, if you averaged down, the story would be different, but still.
Waiting is not a bad thing. Stop chasing this FIRE nonsense, the idea that you must invest everything as soon as possible and stay in the market no matter what. Holding cash is not bad, either. It’s far better to hold onto cash than to make an impulsive investment and lose. At least with cash, you’re only losing to inflation.
Let’s return to our META example. With one well-timed purchase, you could’ve bought at a low point and waited just 2 years for the kind of return the S&P 500 typically delivers over 20 years. Be patient. Don’t rush.
A quick tip. One way to time your entries more effectively is to watch the Relative Strength Index (RSI)—make sure it’s not in the overbought zone on the daily and weekly timeframes. Easy.
Life Hacks 2-Pack
Cut Electricity Bills by Switching to LED Bulbs
LED bulbs cost about the same as traditional incandescent ones and are even cheaper than fluorescent bulbs. They don't flicker and instead give off a smooth, steady light that feels more natural, which means less eye strain and healthier eyes.
LEDs can last over 7 years, depending on how often they're used, because they emit light from a semiconductor. They're also 5 times more efficient and use almost no energy for heat.
You can easily drop your electricity bill by up to 80%!!!
Better for your wallet, better for your eyes, and better for the planet.
Leave Items in Online Checkout, Then Wait for Discounts
Many online stores offer discounts if you leave items in your shopping cart for a few days without completing the purchase. This is known as an "abandoned cart" strategy. After a few days, businesses send follow-up emails—sometimes offering a coupon right away, while other times spreading it over a few emails. The coupon could be for free shipping initially, but more often, it’s a discount.
The discounts can range from 10% to 20%!!!
However, this strategy mainly works with smaller stores on platforms like Shopify or retailers in clothing, jewelry, and niche markets like backpack shops. Large marketplaces like Amazon or eBay don't offer such discounts, but Etsy often does.
Thank you so much for taking the time to dive into this week’s insights. This one was a bit longer, and I hope you found the insights valuable and actionable.
See you next Thursday!
Great publication!