Curriculum·S207 Investing Frameworks (Unleveraged)·about 30 min
Time horizon honesty
By the end of this lesson you can
- →Distinguish an intended horizon from the horizon your obligations actually permit
- →Identify the events that shorten a horizon without warning, and price them
- →Explain why an illiquid or restricted holding can impose a horizon you did not choose
- →Set an allocation from the shortest horizon in your own life rather than the longest
Sophomore · enrolled learners
This lesson opens with The decade nobody chose.
- What happened
- Mt. Gox handled a large majority of global bitcoin trading before collapsing in February 2014 with about 850,000 BTC missing, valued around $473M at the time, of which roughly 200,000 were later recovered from an old wallet. The Japanese proceedings ran through bankruptcy and then civil rehabilitation, and the trustee did not begin distributing to creditors until July 2024, more than ten years later, with the final deadline extended repeatedly. Many creditors ultimately received more in dollar terms than they had lost, because distributions were partly in bitcoin and the price had risen enormously across the intervening decade.
- The decision point
- Every one of those creditors had a horizon in mind when they deposited, and none of them had ten years in it. The favorable dollar outcome was produced by an asset appreciating during a period of enforced holding, not by the process working, and anybody who needed those funds in 2015, or 2018, or 2021 experienced the same event as a total loss for the period that mattered to them.
- Recorded loss
- $473,000,000
What you will be able to answer
- →What determines your real horizon?
- →Name the events that shorten a horizon without warning.
- →How can a holding impose a horizon you did not choose?
- →Which horizon should set your allocation?
Orientation and Year One are open: anyone can read them without an account. From Year Two onward the lessons are for enrolled learners, because progress through the later years only means anything if it is tracked against a record.
It is free. We do not sell the list and there is nothing to buy at the end of it.
Sources and review
- https://www.nbcnews.com/business/markets/mt-gox-begins-repaying-bitcoin-creditors-decade-after-collapse-rcna160489
- https://insights.glassnode.com/the-week-onchain-week-31-2024/
- https://www.dalbar.com/PressReleases/doc/QAIB2024_PR.pdf
- https://www.arnoldporter.com/en/perspectives/advisories/2023/01/read-before-you-click-accept
Confidence high·Volatility medium·Reviewed 2026-08-06·Owner unassigned
Contested
F107-04 uses Mt. Gox to teach counterparty risk measured in time. This lesson uses it for horizon imposition. Keep the split; the counterparty analysis belongs in F107-04.
That creditors did well in dollar terms is true and is a consequence of the asset appreciating during enforced holding rather than of the process functioning. Do not present it as a reassuring outcome.