'Bitcoin's Silent IPO': Analyst Addresses BTC's Lame Price Action in Viral Weekend Essay

What to know:

• While bitcoin didn't have an actual IPO, its recent acceptance in tradfi circles is similar and resulting in similar price action to that seen in stock IPOs, wrote Jordi Visser.
• It can take many months or years for the stocks of even generational companies to recover from the process of early investors cashing out their stakes, and bitcoin is proving no different.

It's not exactly news to frustrated bitcoin bulls that risk assets across the planet for months have been recording what seem like daily record highs while the price action in BTC remains rather muted.

"What if everyone is looking at this wrong," asks longtime traditional finance asset manager Jordi Visser in a heavily shared (1.5M views on X and counting) weekend essay titled "Bitcoin’s Silent IPO: Why This Consolidation Isn’t What You Think."

While bitcoin never had a traditional IPO, the factors liming price gains are nearly exactly the same as those which cause poor price performance in stock IPOs, argues Visser.

Tradfi IPOs and the months that follow, reminds Visser — particularly in tech — are major liquidity events for early investors.

"Early-stage investors take enormous risks," wrote Visser. "If the investment succeeds, they deserve enormous rewards. But eventually, and this is crucial, they need to realize those gains. They need liquidity. They need an exit. They need to diversify."

The examples, particularly in tech, are legion, but consider the Facebook (now Meta) IPO of 2012. The offering at $38 per share raised $16 billion at a valuation of $104 billion — quaint numbers today, but staggering amounts at the time. One year later, the stock was 30% lower, with pundits questioning Mark Zuckerberg's leadership.

More likely than missteps by Zuck, it was early investors — be they his Harvard buddies, or Silicon Valley types, or the carpenters who framed out Facebook's first offices (who took pay in shares rather than cash) — using public markets to realize life-changing profits.

Importantly, says Visser, the early investors don't hit the bid all at once. "They’re methodically distributing their positions. They’re being careful. They don’t want to crater the price. They’re patient. They’ve waited years for this moment. They can wait a few more months to do it right."

The result, he says: "A sideways grind that drives everyone crazy." Sound familiar?