The Focusing Illusion: Why You're Panicking at All-Time Highs

Happy Friday Bitcoiners!

This week, I saw over 100 charts pointing to Bitcoin's weakness. Double tops. Death crosses. Eight days of red since $124K’s all time high.

By day seven, I opened my River app, with my finger hovering over the sell button.

Then I caught myself: We're at $112K. Up 100% this year. And I'm about to panic sell because of a few red candles?

That's when it hit me - I wasn't responding to reality. I was responding to whatever I'd been staring at. This is the focusing illusion in action.

We explore this mental trap by diving into👇

• Why your brain lies about what matters.

• The Kanye disaster that proves we've learned nothing.

• Why "$1M Bitcoin" won't make you as happy as you think.

Let's dive in⚡

1) Why Your Brain Manufactures Importance

The thing you're focusing on right now about Bitcoin? It's probably not what matters. And thinking about it is making it seem way more important than it is.

Kahneman discovered this with his California study. When asking people if they'd be happier in CA, most say yes due to better weather. Even Californians themselves think they're happier than the rest of the country.

But what about when measured with data? The study found that people in Michigan were in fact just as happy as their Californian counterparts. Why?

Because 99% of life (be it relationships, work, hobbies etc.) is the same everywhere. Weather only matters when you're thinking about it.

Same with Bitcoin's price. Open TradingView for the 47th time today, and that 5% drop becomes your entire world. The focusing illusion makes you forget that 99% of Bitcoin's reality - the code, network effects, adoption curve - hasn't changed at all in the last week.

Remember November 2022? FTX collapsed, Bitcoin hit $16K. Everyone focused on "contagion" and sold the bottom. Those who remembered that FTX was just one shitty exchange ended up buying the generational bottom and now are up 7x since.

If I asked "How's your Bitcoin investment?" right now, you'd think about this week's red candle and feel terrible - despite being up 100% this year. But if I asked about family first, then health, then Bitcoin? Same investment, different emotional weight.

The focusing illusion doesn't just distort reality - it manufactures importance out of thin air.

2) The Kanye Catastrophe: When Focus Blinds You

But who cares about the focusing illusion? Well Well, take a look at this week's disastrous token launch by Kanye (the coin ticker is “YZY” if you’d like to see how far its down already).

This perfectly showcases how the focusing illusion can destroy wealth in real-time.

Within hours of launch, retail poured in millions, focused on one thought: "If Trump’s coin can hit $10B market cap, so can this!" That possibility grew so large in their minds that it crowded out everything else. Red flags invisible. Logic gone.

What they weren't thinking about:

• Insiders held 70%+ of supply

• Zero utility beyond speculation

• All the historical celebrity token launch failures

Twenty-four hours later: insiders dumped. Millions evaporated. While these degens chased moonshots, Bitcoin quietly ticked along, undistrubed by the folly of “crypto bros”.

The focusing illusion creates artificial urgency: "Buy NOW or miss forever!" Your brain can't see there's no actual urgency. With Bitcoin however, we know it’ll be there tomorrow. The YZY shitcoin? It exists specifically to exploit your focusing illusion.

3) The Million Dollar Mirage

Here's the brutal truth: When Bitcoin hits $1M, you won't be as happy as you think.

Right now to you, "$1M Bitcoin" means financial freedom, never working again. Because you're thinking about it, it seems life-transforming.

Kahneman studied lottery winners - they're not nearly as happy as expected. Initially ecstatic, the win dominates focus. Then? They adapt. Still stuck in traffic. Still arguing with spouses. Within a year, happiness returns to baseline.

Same with Bitcoin. Every early Bitcoiner I know who bought at $100 and held to $50K? Not in permanent ecstasy. They adapted. Now stressed about why it's not $200K yet (+ they most likely didn’t hold all the way and have regrets about it as well).

You've already lived this. Remember when $100K seemed like validation? We're at $120K now. Are you proportionally happier? Or are you like me, overly stressed about a 10% pullback from ATH?

The focusing illusion makes you miserable NOW. So focused on future wealth, you can't appreciate owning Bitcoin at $120K. We've printed 469 "double tops" since 2009 - bitcoin continues to outperform every other global financial asset.

So, how to go about beating this focusing illusion?

The Context Switch: Before any Bitcoin decision, deliberately think about three other life aspects first - health, relationships, hobbies. Then decide. You'll be amazed how much less urgent that "critical" trade seems.

Key Takeaway

The focusing illusion is making this week's 10% drop seem catastrophic. It's not.

Kahneman's maxim: Nothing is as important as you think it is while thinking about it. That double top? Only critical because you're staring at it.

When Bitcoin hits $200K, you won't remember this week. When it hits $1M, you won't be transformed. You'll adapt, refocus, and find new things to worry about.

Reality check: We're just off all time highs and with massive tailwinds building. But a red candle has hijacked your attention.

The cure isn't analyzing more - it's recognizing your brain's tricks. The best investors have trained themselves to ignore what seems most important in the moment.

See you at $200K when none of this matters 😉

Sincerely, @Publius256