Two thoughts for today:

1. What are the operating rules of Bitcoin (BTC)?

I believe that the price movements of Bitcoin are driven by major players in the context of grand narratives, through a cycle of 'accumulating at low prices, selling at high prices, and then accumulating again at low prices.' During the ups and downs, the major players continuously harvest the wealth of market participants.

Why do the major players always have funds to drive the market? Because they not only make money by going long through contracts at low prices but can also continue to profit by going short at high prices. They control the trends and almost always profit without loss.

Observations from the past six months reveal: after the major players sell, prices peak and then slowly decline for months; after accumulation is complete, the next round of upward movement starts, followed by a significant correction after selling. Each time they drive the market, the major players can earn several times their investment. Despite BTC's market value growing larger, its unique narrative and currency applications continue to attract a steady influx of capital.

Hypothesis: If there were no contracts and other financial derivatives, it might be difficult for BTC's market value to continue rising. Contracts amplify the profits of major players, but also amplify the losses of retail investors. The essence of the market is a game between major players and retail investors, with funds flowing from cash-strapped retail investors to well-capitalized major players.

2. What is the essence of contracts?

The essence of contracts is volatility. If you bet on the right direction and control the position you can bear, you can continue to make a profit. But the premise is that the direction must be correct, which stumps 90% of players.