A weekly newsletter on actionable digital asset market insights and practical observations with a smidgen of greentea 🍵 insights
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📖 Book of the Month 📖
This month lets read "Daylight Robbery by Dominic Frisby. If you are reading along or listening drop me a note on Twitter or email!
Listen to: Daylight Robbery For Free with Audible. Link
💭✍🏼 Food For Thought 💭 ✍🏼
All the "talk" about inflation peaking and being over obscures the fact that the "level" of inflation globablly will remain historical high and this means central banks will not be able to simply pivot policy (in my opinion) as many think. - Link
SEC orders Bloom Protocol to Register as a Security or Cease to Operate - Link
Tornado is now under Treasury Department Financial Sanctions (i.e. US Persons nor US companies or banks can touch anything connected to this service) - Link
Great article on private market funds (Buyout & VC) and portfolios being "written down" and sold at a discount to the NAV - Link
SoftBank's Vision Fund (the poster child for excess company valuations) has lost $23BN /JPY3.1 Trillion in the last quarter - Link
This masters because Vision Fund was the incremental buyer on the way up pushing any number of private market valuations
💸 Companies and Deals I am Watching Closely 💸
1. Lattice Capital raised $60 million for its second crypto fund - Link
2. Merkle Science, a blockchain analytics company, raised $19 million as an extension to its $24 million Series A round of financing - Link
3. Unstoppable Finance, a DeFi wallet company, raised $12.8 million from Lightspeed, Rockaway Blockchain Fund and Fabric Ventures - Link
📖 Quote of the Week 📖:
“The tale of Enron is a story of human weakness, of hubris and greed and rampant self-delusion; of ambition run amok; of a grand experiment in the deregulated world; of a business model that didn’t work; and of smart people who believed their next gamble would cover their last disaster—and who couldn’t admit they were wrong.”
― Bethany McLean, The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron
📰 This Weeks Most Interesting Digital Asset News 📰:
1. U.S. Treasury Sanctions Notorious Virtual Currency Mixer Tornado Cash - Link
2. Celsius Creditor Committee Takes Aim at CEO Mashinsky, Other Insiders - Link
3. First BitMEX Employee Swaps to Guilty Plea - Link
4. You really should read the Coinbase Shareholders Letter if you are in the crypto arena - Link
5. Goerli Testnet Is Ethereum’s Final Boss Before the Merge - Link
6. DYdX Attempts To Spare Users Unfairly Targeted by Tornado Cash Sanctions - Link
7. CoinFlex, the Crypto derivatives exchange claims to have a significant loss at the hands of Roger Ver, has filed for restructuring in the Seychelles - Link
📈 Top 10 Market Movements by Market Cap over the last 7 days 📉:
Bitcoin: Price OHLC
You can see above that Bitcoin has not broken above the $48k amount in 2022. We had a slight bounce this week that you can see above. I reiterate--I continue to remain bearish but I am keeping an eye Bitcoin and I think I will be moving my time horizon out to the end of 2022. What I am really looking for is some evidence of a monetary policy shift from the Fed but we are not there yet and it looks increasingly like we may not get there in 2022. We could see Bitcoin back at its March 2020 lows --in my humble opinion.
Bitcoin: HODL Wave
The chart shows the bundle of all active supply age bands for Bitcoin, aka HODL waves. Each colored band shows the percentage of Bitcoin in existence that was last moved within the time period denoted in the legend. We still have more to go. I personally still think BTC will go back toward
$15,000 $5,000 and potentially back to the March 2020 lows. Keep you eye on all the various corporate developments this coming week from earnings to economic data and then the Federal Reserve's decision on rate hikes on 27 July 2022--capping it off w/ US GDP numbers on 28 July 2022. The next few weeks will be very interesting--buckle up!
Bitcoin: Net Realized Profit/Loss Ratio
Net Realized Profit/Loss Ratio is the ratio between realized profit and realized loss. As you can see above the majority that have sold as at a loss on a "net" basis on the lows this prior week. As you can see above the realized losses on increasing but not at the lows of January. The losses are starting to hurt even long time hodlers at this point as we are current in the $19,000 range but it's not showing on the chart above. If we breach $15,800 or so this would be the number roughly before BTC really took off in the last months of 2020.
Ethereum: Price OHLC
OHLC is the Open, High, Low and Close price. ETH is now clearly down just like Bitcoin above and you can see here it is way off the highs of the prior weeks and also down the the year of 2022. I think the pending switch the ETH2 will bring significant downward sell pressure as people exit post ETH2 merge lockup. I know the merge is coming but I personally think we see ETH back around $500 for a spell.
USD Coin: Circulating Supply
USDC continues its trend with a small drop in circulating supply this week with a clear movement in the direction of use. It seems the market is speaking at least from a US KYC perspective that people (in spite of what they say about decentralization) want a single counter-party that can be trusted to hold the peg to cash. Lets see how this plays out over time.
Total Value Locked (USD) in DeFI
TVL is flat this week but still in a downward trend
As a reminder TVL means "Total Value Locked". This refers to people taking ETH based tokens or other tokens and "locking" them in DeFI protocols to lend, generate yields and otherwise earn excess returns.
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Green Tea Tidbits:
The scientific name for green tea is Camellia Sinensis.
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