What says that a crypto crash will affect the regular economy as a whole, though?

I think he may mean that the exuberance going on right now in the crypto and nft markets may be seen as a "top signal" predicting a market crash soon (people moving into riskier and riskier assets usually precedes a crash). Timing the top of markets is hard though - and while the music is playing you have to dance.

Oh, it most certainly would; it would wipe out billions of dollars of what many people consider part of their wealth. Joe Cryptomillionair spends more of his regular income because he feels rich because of the balance in his crypto wallet, and thus stimulates the economy. Wipe all that out and suddenly a lot of people who were spending a lot of money are scrambeling to pay their morgages, perhaps even having to sell other investments to do so.

Do we have any idea how many people have wealth in Bitcoin etc? I tend to assume if someone is driving a Tesla they bought a bitcoin for ten bucks back in the day, but that's just based on who I have talked to. Is there any good surveys?

well, coinbase claims to have 73M verified accounts [1], so, quite a few?

and anecdotally, yeah, seeing crypto go up has similar impact on me as seeing stocks go up: i feel more comfortable making larger purchases whenever my wealth goes up, doesn’t matter if crypto v.s. equity (if volatility impacts your comfort, then you just cash out your gains and soend those).

[1]: https://www.coinbase.com/about

Yeah, but... There are only 21M BTC ever going to be mined, and at something like 20/40/60K (wild price fluctuations this year) all of those accounts cannot have "fuck you money" in them. It's probably a power law so most people holding BTC don't have even one coin.

So ... it just feels like a sizeable but still very small minority.

i imagine most market holdings follow power laws. or is the stock market different in this way because of more widespread pensions/retirement accounts?

either way, a $2T crypto market (i don't know where GP got $3T from: CoinMarketCap.com lists 2.2T) is substantially smaller than a $50T stock market. Governments can and have just straight up injected that demand equivalent in value to that $2T figure into markets in the past, so if we have a crash localized to crypto, it's not as though govts have no recourse.

There have been a ton of them and it hasn't even come close.

It is this it previous metrics never decide next crash. If this was so take out shorts on major market players and get rich. Environment is highly uncertain and those who have introspections make best. Manipulators try to move markets way they want because they already made bets.