Zeitgeist Explorer⚡

Two new companion preprints, with replication packages and prediction registries. They both work on Bitcoin data: one is about the trend, one is about the noise. Links below.

Gresham's law en.wikipedia.org/wiki/Gresha…

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The central message of this paper is relatively simple. Bitcoin's volatility declines approximately with the age of the network. But its volatility memory does not appear to expand in proportion to that age. At the same time, the statistical distribution of returns changes in a direction that challenges a specific class of stochastic-clock models. These findings suggest that the amplitude, memory, and shape of fluctuations should be treated as distinct properties, rather than assumed to be different expressions of one underlying process. A power law may describe how a system scales, but it does not, by itself, explain how the system evolves, and thus to which universality class that power law pertains. The general mathematical contribution is to show how assumptions about stationarity in logarithmic age generate exact restrictions on the relationship between returns observed at different stages of a system's development, and how stronger assumptions generate additional, testable predictions. The empirical contribution is to show that Bitcoin does not simply become a smaller version of its younger self. Its fluctuations change in more than one dimension, and those dimensions do not necessarily follow the same clock. Its behavior remains unique across crypto assets. This distinction is relevant beyond financial markets. For example, researchers studying earthquake aftershock sequences, growing networks, biological systems, or disordered materials may encounter processes in which the overall amplitude, persistence, and distributional shape evolve at different rates. The framework developed in this paper offers a way to formulate and test such possibilities, exploiting the broad availability of past and future data of the Bitcoin network. But it should be clear that those mentioned are potential applications on different datasets, not empirical findings established by the Bitcoin analysis itself.

Happening. It's easy to see the future once you patch different perspectives together with reasonable weights; the strategic equilibria emerge. Yann LeCun proved something along these lines for LLMs recently; it is indeed true for us. Allow me a Western civilization quote then, since we're entering this vibe-decade: “One of the most highly developed skills in contemporary Western civilization is dissection: the split-up of problems into their smallest possible components. We are good at it. So good, we often forget to put the pieces back together again.” A. Toffler

People hate the Golden Age.

Big sweep at the midterms. Likely the beginning of the end of MAGA. Dems are bringing out some new faces and scaling back certain identitarian themes of the woke movement. The GOP, entirely Trump-centric over the last 10 years, finds itself in a position where it has to reform, and it's implausible that will happen in the next 2 years while Trump remains in power.