summary on blob

https://fxtwitter.com/crypto_colombus/status/1860494641143120115?s=46&t=nluSw7cwYGx8zFxfoYi5Iw

wanted to bring this thread back from over a year back, because somehow i think it shaped the way i trade a lot this cycle as well

something i call 'value gap trading'

i don't think its anything new and done by plenty of others too, but worth a read if you find yourself losing more often

if you've realised, its how i pitch or think about some of my trades

eg. if A is 100m, B is 50m, then C shouldn't be at 5m given a similar incoming product with a better model. I'll pick it up as a short term swing trade and wait for the market to reprice to a level i find overvalued.

this slide especially:
https://x.com/therobotjames/status/1717053804242522345

for this meme cycle, after you've spent a decent amount of time in the trenches and understanding how market values certain things, you should be able to gauge valuations that you deem fair value for tokens that you see

overvalued? pass the trade. even if KOLs shill it and price pumps 3x, its okay to miss these kinds of trades, cause its overvalued in your mind (if your gauge is correctly tuned)

fair value? maybe keep watch.

below fair value? buy and wait for repricing.

everyone values things differently, so thats the hard part here, which is to tune your gauge in accordance to the market

a lot of other factors to note as well, things like:

- is it a beta? what degree of derivative is this?
- how diluted is the narrative?
- how catchy or attractive is the content?

and many many more to consider

market won't always reprice everything even if you're right and some trades that you take will remain overlooked, its just like that sometimes

part of the game

best trades are trades that nobody knows how to value because then there is no ceiling

and the clearest narrative with no immediate ceiling rn is AI agents

there is a reason why goat could run to almost 900m in a single leg

jeffy is working at insane speeds, eventually covering all bases and engulfing the ai agent space as a whole -> he understands the game

this is another reason why looking forward it is better to position in infra plays before the market catches up

whatever edge that you think your current agent has, will eventually be eroded

being the first in a respective edge might give you a larger premium, but over time the premium erodes as every other agent will be able to do the same

this is especially true if you only have one usp over the rest and you just bank on selling that one usp forever

winning agents will be ones that can keep growing at the market's pace

due to the vertical's nascency, we don't see typical power law distributions yet

the starting pistol was just fired a month ago

but the disparity will only increase moving forward where winners will continue outperforming by multiples

eventually power law distribution will hold true

you might think your 50m agent might be able to catch up with a 500m agent, because its only 10x away

doable right?

but down the line your 50m agent might become 100m, while the 500m agent goes 2b, then its 20x away now

you get my point

what can your 40m agent do?

oh, it can banter and do NFTs, cool!

zbro can do that too

so whats special here

hmmmmm

think i'll still stick with this

its clear to see a lot of newly launched agents use eliza framework, even alliancedao's new slime

question here is will this trend remain after zerepy is out?

if so, then ai16z will trade higher eventually again

just gotta wait for shaw to stop his power trip or something

dev risk on this is the same as ACT pre-nuke

ridiculous af

but at least ai16z has more to offer than ACT

saylor still has 3b to deploy

probably slurping rn bit by bit

https://saylortracker.com/

JUST IN: Michael Saylor's MicroStrategy has over $3 billion to purchase more Bitcoin.

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