The current rise is clearly unsustainable, but seems like a tricky thing to trade around given the obvious reflexivity in something like BTC (the more people accept it -> the more valuable it becomes) and the "low float" of BTC available relative to potential demand if institutions are truly purchasing.
I, too, am flip-flopping to try to manage both potential upside and downside.
Prior rallies have gone 10-40x from the point they really took off. So let's keep the current context of the roughly 4x rally from 10k in mind. That's roughy where it traded at pre-pandemic and where it traded out before going vertical so that's the base I'm using.
That being said - it's easier to 40x @ a $40 million market cap than a $400 billion, so that must also be considered. Also the unprecedented disconnect in daily supply and demand must also be considered due to institutional demand having stronger hands and buying larger $. Ultimately, I imagine this will behave similar to others and maybe 10x is about what we can expect to see out of this rally before it blows up again and drops to 20-30k all over.
I've been struggling with how to manage this because it's literally unlike anything I've ever owned. Fortunately, I had foresight that this might be an issue by envisioning what I would do if it did sky rocket to 100k as I was buying it.
I made the decision to DCA BTC to HODL and buy GBTC in an IRA to trade. I'd trade the GBTC around the NAV premium expansion. Buy when it was <15% and sell when it was >25%. Also decided that my total look-thru BTC exposure should be ~30% higher than my desired long-term holding of it to provide me flexibility to trade around it if it did rise without dipping into my desired end-state allocation.
The rise from 15-20k provided an opportunity to exit GBTC, tax free, at 30-40% premiums. I was selling a little every day and neutralizing most sales with new purchases of BTC. Reducing risk, tax free, and making it feel like I was doing something to put my nerves at ease after such quick run.
Post 25k I stopped neutralizing the GBTC sales. Still selling ~1% of the position every other day or so, but am now actually reducing BTC exposure in a tax free manner. Still holding all of my taxable BTC with limit orders put in ~15% under the market price to catch any downdrafts and consolidations. Have the confidence to do this, even at these elevated prices, because I'm still selling GBTC regularly and these would just act as partial neutralization transactions.
All in all - feeling comfortable about the results. I've taken thousands off the table, tax free, still have roughly 90% of my overall BTC position and am still above my threshold of desired ownership with room to make more sales if we continue to rally. Having the system and the trade activity does relieve some of the anxiety around the position now that 15% of my entire net worth is in it after just 2 months....
