Paradox With Bitcoin

Hey, I'm a 5+ year holder. I stopped caring about the memes and language years ago.

Just an observation, but I think many of us are in a paradox wrt money supply and appreciation of the asset. People on this sub criticize the Fed for injecting liquidity into the economy, yet many also gleefully get excited for "mooning" and "money printer go brrrr..." ad nauseum.

Bitcoin is a young risk asset and correlates heavily with M2 supply. Therefore, the very stimulus which devalues the dollar ends up pumping Bitcoin after several months of QE.

I'm beginning to wonder what would happen if the Fed did not inject liquidity as it does today. I'm guessing markets and all assets will correct hard, and we'll see a prolonged recession. The silver lining might be it will return the purchasing power of USD back to people. Next, Bitcoin drops to the lowest end of the logarithmic curve and folks can buy at a major discount and it will appreciate slowly according to its halving schedule.

I suppose the honest way to look at Bitcoin is recognizing given the Fed regularly injects liqudity to keep markets intact, it has consequences such as maintaining/prolonging asset bubbles. Bitcoin happens to benefit from these liqudity injections and it appreciates faster (sometimes) relative to other assets like gold or stocks. Therefore, it's better to hold some Bitcoin. But, in being honest, given current central bank monetary policy, we're all cheering for the decline of dollar purchasing power.

Just a thought experiment. Sorta reminds me of that scene from the Big Short when the characters shorted a bunch of CDOs and Brad Pitt said, "Don't fucking dance"