If You Want to Invest in Bitcoin, Try Thinking Like a Venture Capitalist During the 2025 Bull Run

"Bitcoin's price is climbing. Should I buy more or sell? What should I do?"

My girlfriend asks me this every time BTC surges. Turns out, she's not the only one with this question. As a WEB3 VC, I hear it daily. So, here's my take—girlfriend included.

As a Multifamily Office Manager, I was taught to be cautious - price and value aren't always the same thing. Price is where supply meets demand value is what people perceive it's worth. This distinction becomes crucial as we navigate the current crypto landscape.

It's early December 2024, and the crypto market is heating up again. Bitcoin is surging past previous resistance levels, and institutional interest is reaching new heights. But beneath the surface of price movements lies a more complex story – one of evolving market dynamics, shifting power structures, and emerging opportunities for sophisticated investors. When my girlfriend asks me about Bitcoin's value, I always start by explaining two powerful analytical tools we use in professional investing. First one needs to understand the model that most successful WEB3 investors use.

Understanding Bitcoin's Value Through Stock-to-Flow

One of the most powerful tools for understanding Bitcoin's value proposition is the Stock-to-Flow (S2F) model. As both a WEB3 VC and family office manager, I've found these metrics invaluable for making rational investment decisions. Let me break them down in a way that even my family members can understand.

Think of Bitcoin like digital gold, but with one crucial difference: we know exactly how scarce it is. Bitcoin has a maximum supply of 21 million coins and a predictable issuance rate, determined by its code. This, combined with lost BTC, creates absolute scarcity, making it a deflationary asset by design. Here's a bonus point that often gets overlooked: 1 BTC equals 100 million Satoshi. This will matter in the future for ease of transaction and unit bias. Mark my words: "Satoshi to 1 USD" will become a meme – do the math.

The S2F model is surprisingly straightforward: it divides the current circulating Bitcoin supply by the annual flow of new coins. Higher ratio? Higher scarcity. Higher scarcity? Potentially higher price. It's not just theory – the model's historical accuracy in predicting Bitcoin's price trajectory has been remarkable. Just look at October-end, when Bitcoin was around $70,000. The S2F model was already hinting at Bitcoin solidifying above $100,000. As I write this, we're already seeing Bitcoin cross $98K, while S2F shows $150,000 in DEC.

The Market Value to Realized Value (MVRV) Ratio: A Market Temperature Gauge

A second professional tool I use is the MVRV ratio - my go-to chart for identifying market cycles at our family office. Think of it as a thermometer for Bitcoin's market health – it tells us whether the market is running a fever (overvalued) or feeling under the weather (undervalued).

Here's how it works: MVRV compares two key prices:

1. Market Value: What people are willing to pay for Bitcoin right now
2. Realized Value: The average price at which all coins last moved

When I explain this to clients, I use a real estate analogy: Market Value is like today's listing prices in a neighborhood, while Realized Value is like the average price at which current homeowners bought their properties. This comparison can tell us if current prices are reasonable or excessive.

Here's why this matters: when MVRV climbs above 3.7, it's like a fever warning – the market is overheated, and people are paying far too much relative to the underlying cost basis. I've seen this signal help our family office clients avoid numerous market tops. Conversely, when MVRV drops below 1, it's like finding properties selling below their purchase price – historically a great time to accumulate. This approach has helped us identify optimal entry points during bear markets.

Why Retail Investors Often Miss Out (And How VCs Win)

From my perspective as a VC, I see a clear pattern: retail investors often buy post-hype, while VCs get in early. It's not about having special powers – it's about having a different approach and better tools.

The typical retail investor faces several disadvantages:

• They discover projects only after they're in the public domain

• They buy when prices are already inflated

• Emotions often drive their decisions

• They lack access to sophisticated strategizing tools

  
  

Meanwhile, VCs win because they:

• Get early access to high-potential projects
• Make decisions based on fundamental analysis rather than hype
• Have structured investment frameworks
• Maintain emotional discipline

How to Think Like a VC in the 2025 Bull Market

In my experience managing my own WEB3 investments, I've noticed that crypto bull markets follow a predictable pattern. Money flows like a cascade: first Bitcoin, then Ethereum (often outperforming Bitcoin due to its broader utility), followed by large-cap altcoins, and finally, smaller altcoins and meme coins experience explosive growth.

To capitalize on this pattern, here's what I tell my family members and clients:

1. Start early, stay informed, and don't wait for publicity hypes. Begin gathering knowledge about early-stage projects now. Understand their value propositions, strengths, and weaknesses before they become mainstream news.
2. Use professional tools, and rely on well-formulated models like Stock-to-Flow. Gut feelings often mislead, but data-driven tools minimize human error and bias. This is something I've learned from both my VC experience and family office management.
3. Understand market cycles eventually, Bitcoin will show new all-time highs in 2025, followed by a bear market – and the cycle will repeat. This isn't speculation; it's a pattern we've seen consistently.
4. Stay calm during volatility crypto is an emerging market and prone to unavoidable volatility. The key is maintaining composure during surges and dips – something I've had to learn myself and teach to my family members.

The Key Takeaway

What makes crypto unique is its pure digital nature. While VCs might have certain advantages, the market isn't exclusive to us. Any retail investor can make substantial gains with well-guided decisions and prudent conduct.

Remember, we're not just speculating on digital assets – we're participating in a fundamental transformation of financial systems. Whether you're managing a family office, advising clients, or investing your capital, the opportunity to participate in this revolution is open to everyone. The key is approaching it with patience, understanding, and the right analytical framework.

Remember, this isn't just about making quick profits – it's about understanding and participating in a technological revolution that's reshaping finance. Whether you're a family office, a wealth manager, or an individual investor, the opportunities are there. You just need to approach them with the right mindset and tools.