In the alternative investment industry, there is an unpublished list of all-time excellent risk management trades. There is Balyasny Asset Management logically modeling in 2015 that the US Federal Reserve withdrawing quantitative stimulus might lead to a crash and adjusting its risk management overlay accordingly.  There is Jim Chanos and Kynikos Associates calling out fraud at Enron, identifying little underlying value amid the market hype. And there are the likes of Ray Dalio and Bridgewater Associates looking at the consensus hype before the 2008 financial crisis and likewise identifying fundamental concerns that were being ignored.

Is the same true of bitcoin?

What will mark the top in the cryptocurrency market – and who will make this legendary call? And could a recent Morgan Stanley analysis of how value is established in bitcoin reveal the problem with calling a top?

Those who got into cryptocurrencies early are saying enough

“How much is enough?” Bud Fox famously asked Gordon Gekko in the movie Wall Street. “How many yachts can you water ski behind?”

For Litecoin creator Charlie Lee, “enough” might be when an investment you hold is up near 7,200%.

Lee’s reason for selling a cryptocurrency he created was that he had become too influential in moving the price.

“Some people even think I short LTC (litecoin)!” he wrote in a Reddit post. “So in a sense, it is conflict of interest for me to hold LTC and tweet about it because I have so much influence.”

Is Lee getting out near the top or just at a point where he wants to book his paper gains? The same could be said of the Winklevoss twins, dubbed “the Winklevii.” They are mainly using near the same excuse to lighten up on their bitcoin holdings as they seek to launch an ETF or even potentially an exchange. They have quickly parlayed their Facebook-begotten fortune many multiples with their bitcoin investment, raising the ire of former Harvard University President Larry Summers in the process.

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