top of page



Future of Capital Allocation

Your weekly newsletter on the fast-evolving world of investing
The week's developments in investing & technology, explained | 20.06.24

If you’re enjoying this briefing, sign up here — and share it with a friend. Reading time: ~5 minutes


Despite repeated predictions of its collapse, Bitcoin seems to be here to stay. Andrew M. Bailey, Bradley Rettler, and Craig Warmke, fellows with the Bitcoin Policy Institute and co-authors of “Resistance Money: A Philosophical Case for Bitcoin” argue that viewing Bitcoin solely through the lens of a speculative bubble might be a bit... well, narrow-minded.  So, what's the real deal with Bitcoin? Keep reading for a short excerpt on this below, or read the full piece here on the CogX Blog. 


Elsewhere we cover why the UK might be losing the EU’s tech crown, OpenAI’s revenue skyrockets and how you can use AI to pick stocks.


— Charlie and the Research & Intelligence Team

P.S You are now able to sign up for the super early bird offer (75% off) to the CogX AI Summit in London on October 7th here.


Is Bitcoin really a bubble?

“In an age where authoritarian rule rises in fits and spurts, it should come as no surprise that bitcoin might do the same”


The bitcoin bubble hypothesis has floated around for a while. From as early as April and May 2011, when bitcoins traded hands for less than $10 apiece, pundits denounced the entire operation as froth. Two years later, bitcoin was trading between $50 and $250, prompting critics such as economist Stephanie Kelton and Alex Hern (now technology editor for The Guardian) to declare it a bubble once more. Early prognostications established a resilient pattern: declare bitcoin a bubble, no matter the price; if necessary, repeat the charge. The pattern includes Paul Krugman (2018; around $10,000), The Big Short’s Michael Burry (2021; around $50,000), and The Spectator (2024; around $65,000).


Confident obituaries number in the hundreds. But bitcoin remains, to quote The Economist, a cockroach that just won’t die. So too the bitcoin bubble hypothesis: irresistible, immortal. Could the bubbleheads be right? Could it be that Bitcoin was a bubble at $10, $1,000, $10,000, and that this somehow tells against Bitcoin? We’re skeptical.


Bitcoin as a bubble is an image; it can be understood in various ways. Here are three.


Perhaps an asset is in a bubble when its market price exceeds its intrinsic value, where ‘intrinsic value’ here means either cash flow (as with a dividend stock, or an interest-bearing bond) or non-exchange use (as with gold, useful when making jewelry or electronics). Soap bubbles are empty; so are prices that outstrip value. 


Bitcoin has no intrinsic value in either sense. As with physical cash, it has no yield, and can’t be used to make gadgets. Bitcoin’s market price exceeds its intrinsic value. The same is true of the ten-dollar bill in your wallet; you can exchange it for something of value and yet it has no intrinsic value. Bitcoin and dollars are alike in this way, and so are both in a bubble, in this narrow sense.


Here’s where the bubbleheads go wrong. They conclude that something’s being in a bubble in this technical sense means it is doomed, or otherwise bad news. That doesn’t follow. For, like physical cash, bitcoin is useful. You can give someone cash without the permission or knowledge of any authorities; just hand it over. You can’t do this with digital dollars; their movement requires the cooperation of banks or regulated financial services. Bitcoin does away with such middlemen and thus enables global permissionless digital value transfer. It brings cash-like money to the internet. It doesn’t follow that Bitcoin is overall good. The more imperious among us — and above all, the authoritarians — don’t particularly like it when other people can transfer value without their knowledge and permission. And they may be right. But in the face of such authorities and middlemen, bitcoin is a useful tool; it is resistance money. So the claim that bitcoin is in a bubble, in this narrow sense of “bubble”, says no more about it than does the observation that the dollar, itself without any intrinsic value, is in a bubble

… want to keep reading? Check out the full OpEd here on the CogX Blog.


Share your expertise! Want to be a guest contributor in our next issue? drop us a line at:


The investment ecosystem

🪙 Do you own Bitcoin? Then you might want to hold on to your crypto wallet because some experts are predicting the price of Bitcoin could hit 200k by next year, and even $1million within the next decade. 


🇬🇧 Is the UK at risk of losing Europe’s tech crown? Mistral AI, in just a year, has emerged as a formidable competitor to giants like OpenAI, attracting top talent from Nvidia and Tesla to Paris. As French tech surges ahead, the UK must take decisive action.


📈 Good news for startups: GP’s are feeling more bullish about fundraising and IPOs compared to last year, according to PitchBook’s H1 2024 Tech Survey. They also expect valuations to become more attractive over the next months.


Chart of the week

The crypto industry saw an increase in fundraising for Q1 2024, with VC deal value reaching $2.4 billion, according to a recent report by Pitchbook.


How AI is transforming investing 


🎞️ VC funding for AI visual media surges nearly 90%. Businesses are snapping up AI tools for tasks like automating photo edits or generating personalised sales videos.  Even tech giants like Apple and Google are jumping in the game, reports PitchBook.


🤖 Thinking about using AI to pick stocks? While AI can give you a jump start with stock recommendations, it shouldn’t replace your own inhouse research. Experts say AI tools like ChatGPT can quickly filter tons of data but they lack the long-term track record and human touch of financial advisors.


🚀 OpenAI’s business is booming. Their annualised revenue has skyrocketed to $3.4 billion in just six months. This explosive growth points to businesses readily adopting OpenAI's technology, particularly the firm's wildly popular model, ChatGPT4o.


💰 OpenAI’s Japanese rival gets 1 billion valuation. Founded last year by former Google researchers, Skana is attracting major investors like New Enterprise Associates, Lux Capital, and Khosla Ventures.


💵 The €1 billion NATO Innovation Fund is putting its money where its mouth is. They've announced their first round of investments, backing startups and VC funds focused on deep tech and defence solutions.


🚀 French AI startup Mistral has raised €600m in new funding, propelling its valuation to €5.8 billion. This round was co-led by investment giant DST Global, marking their first investment in Mistral, alongside existing supporter General Catalyst.


📉  British semiconductor startup Graphcore faces a potential turning point. A recent annual report from investor Molten Ventures reveals a nearly 45% decrease in the value of their Graphcore stake, down to £20.6 million from £37.2 million in 2023.




Noteworthy deals

  • Finvourne, a London-based data management platform for asset managers, has raised $55m in series B funding led by Highland Europe and AVP.


  • AccountsIQ, a Dublin based accounting platform for SMEs and non-profits has raised €60m in Series C funding led by Axiom Equity. 


  • Alpha Sense has raised $650 million at a $4 billion valuation in a round led by Viking Global Investors and BDT & MSD Partners.


  • Cognigy, a Germany-based startup developing AI agents for customer services has raised $100m in Series C funding led by Eurazeo.


  • YesWeHack, a Paris-based platform connecting organisations with ethical hackers has raised €26m in Series C funding led by Wendel.


✍️ Enjoying this newsletter?  Subscribe to our free weekly briefings on Preparing for AI, Cinema & AI, The Race to Net Zero, AI & DeepTech and The Future of Work.

You can relive CogX Festival 2023 on our YouTube Channel now. Make sure you join us in person next year — get your super early bird tickets for CogX Festival 2024 now!


Disclaimer: This content is for informational and educational purposes only. It does not constitute financial, investment, legal or tax advice.

bottom of page