Bitcoin Myths, Part 6
If you really believed, you’d go all in.
In 2014 CZ the founder of Binance sold his apartment and put all the proceeds into Bitcoin.1 He bought around 800 Bitcoin and today is easily worth $52 million dollars! 2
He took a big risk and got a big reward.
Scoffers will look at Bitcoin hodlers and say “If Bitcoin is so great why don’t you do the same thing”?
But they leave out CZ’s situation.
He was an early member of Blockchain.info at the time with a lucrative salary.
Had built high frequency trading systems and had in demand skills
If Bitcoin went to zero, it would have hurt but it would not have ruined him.
Most people can’t afford to take that kind of risk.
Tether Buys Gold
It’s been in the news that Tether is buying gold and Bitcoin critics are screaming about it. 3
Critics argue this proves Bitcoin is over. If one of the largest crypto companies is shifting reserves, then so should you. But that ignores Tether’s reality.
Here’s Tether’s business model in a nutshell.
They buy short term US government bonds and hold cash equivalents.
They issue tokens ($USDT) tied to the U.S. dollar that are supposed to be backed 1:1 by reserves.
They earn interest on those reserves while users trade and spend the Stablecoins.
Large institutions can redeem $USDT for actual dollars.
Public attestations suggest the reserve mix looks roughly like this:4
Short term US government bonds 75%
Gold 10%
Other (secured loans and various small investments) 10%
Bitcoin 5%
Tether’s Truth
Critics look at this portfolio and say Tether doesn’t believe in Bitcoin. But they miss the point. Tether must redeem $USDT at a moment’s notice. This is why the majority of the reserves are in bonds. They are easy to sell and don’t suffer extreme volatility.
If their reserve system was backed up 100% by Bitcoin it would be a problem. Bitcoin is too volatile. Heavy redemptions during a drawdown could force them to sell Bitcoin into a down market just to raise cash.
Gold can be volatile. But historically, it is far less extreme than Bitcoin. Both assets diversify the reserves. At the end of the day, Tether must back its tokens. It can’t risk its redemption system on a Bitcoin volatility roller coaster.
This Applies to People Too
Everyone’s situation is different. CZ could afford to sell an apartment and buy 800 $BTC. My 90-year-old grandpa can’t put more than 1% of his portfolio on the Bitcoin roller coaster. He needs to buy groceries. This is not “disbelief” in Bitcoin. It’s risk profile.
Even if you’re convinced that Bitcoin is going to $1 million dollars you probably shouldn’t go all in. If the car breaks next month, you don’t want to be forced to sell at a loss. Short-term needs override long-term upside. That’s not hypocrisy or lack of conviction. It’s just knowing your limits.
Bitcoin Myths Book
I’m turning the Bitcoin Myths series into a book. Something you can give to your friend who throws every Bitcoin myth under the sun at you. Paid subscribers will get first access when it’s released.
If you want first dibs, become a paid subscriber.
Final Word
Don’t let anyone shame you into taking risk that you’re not ready for.
"Never risk what you have and need for what you don't have and don't need." — Warren Buffett
Disclaimer:
The information in this publication is for educational purposes only and does not constitute financial, investment, or legal advice. Always do your own research before making any financial decisions. Cryptocurrency investments carry risk, and past performance is not indicative of future results. I actively invest and trade in the crypto markets, and my personal portfolio and holdings change frequently. Nothing I share should be interpreted as a guarantee of performance or a recommendation to buy or sell any asset.
https://www.binance.com/en/square/post/290788199391457?
This is according to prices on 2/18/2026 on CoinMarketCap
https://www.coindesk.com/markets/2026/02/09/tether-s-gold-stash-tops-usd23-billion-as-buying-outpaces-nation-states-jefferies-says?
https://tether.to/en/transparency/?tab=reports