@ Peter R That analysis has so many flaws...
The analysis was hugely simplified to illustrate the benefit of hedging using simple math. I explained that in the post.
I also showed that even if you assign a 95% probability to the value of bitcoin going to zero, it can still be useful as part of a wealth-preservation strategy.
That's not how probabilities work though. You didn't show anything except you made up some random numbers and drew conclusions from them.
All you said was if you invested 5% of your portfolio in BTC today it could return 20X or zero. You came up w 5% because you believe thats an appropriate amount of risk attributed to random probabilities 5% vs 95%.
Buying BTC is not a hedge against demise of USD. If you think USD will fall then you should short USD. If you think BTC will rise then you should long BTC. There is no correlation as a trade
It's actually hard to price USD without being paired to something. Its easier if you compaired BTC to gold or some other commodity so you can analyze the prices in USD. Throw up 2 charts and see if there is correlation or not.
I think the only reason you believe there is a correlation of BTC & USD is because the propaganda of BTC is anti-Central Banking. BTC pumpers always talk about demise of fiat money. Gold pumpers say the same thing to pump gold price.