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 let's add a new book that is very interesting and financial history of the world during the gold standard era from the 1920's and 1930s. I am reading this book because it is a great view into what a changing monetary system looked like during that era and the divergences that central banks had in an every man or woman for themselves period of transition.If you are reading along or listening drop me a note on Twitter or email!
Listen to: The Lords of Finance For Free with Audible. Link
💭✍🏼 Food For Thought 💭 ✍🏼
What more emblematic example of the "round trip" that I have been discussing for months than this headline below re Robinhood. To be 100% clear I am not wishing for this merely stating what I believe will increasingly become "consensus" in short order. I think this is coming to the Crypto market as the ramification of the Fed's policy reversal play out, until the Fed reverses again and goes back to print money to stop all pain. I think the same Millennials / Gen Z that drove the (i) day trading (i) stock price and volumes on Robinhood as the same people that also drove Tesla and Crypto and this is a snapshot of what may come. Link
So let's connect the dots a bit. The role of the USD in markets (in markets from real estate to stocks and crypto) is connected to what we are seeing today out of the Fed. Interest rate policy is better described as "the price of money policy". Rates going up means money becomes more expensive, credit evaporates because the cost of service/ pay back debts goes up. This is why housing and interest rates matter and also practically why people used to but all their money in bonds during the times I was kid when the "coupon" or interest payment was close to 10% which sounds crazy today, maybe not so crazy after all. Good read below for more context. Link
The Japanese Yen story is more important than most people in the West understand. To put it in simple context the Yen is at a 30% discount to the US Dollar. Link
The fact that the Commodity Futures Trading Commission is holdings a round table about Sam Bankman-Fried of FTX's proposal to dis intermediate derivatives is a testament to the behind the scenes political influences SBF and FTX are wielding in Washington. We will look back at these moments. I have linked the article below as well. This will be live via Zoom US EST May 25, 2022, from 9:30 a.m. to 4:00 p.m. 👇👇
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💸 Companies and Deals I am Watching Closely 💸
1. 0x Labs, a provider of infrastructure for decentralized exchanges, raised $70 million from Greylock, Pantera, Jump and others. - Link
2. Vertex Protocol, a decentralized foreign exchange platform, raised $8.5 million from Hack VC, Dexterity Capital, Jane Street, and others. - Link
3. Afriex, a blockchain money transfer business based in Nigeria, raised $10 million from Sequoia, Dragonfly and others. - Link
📖 Quote of the Week 📖:
"It’s like déjà vu all over again."
-Yogi Berra
📰 This Weeks Most Interesting Digital Asset News 📰:
1. Fidelity to Allow Retirement Savers to Put Bitcoin in 401(k)s - Link
2. Central African Republic adopts bitcoin as legal currency - Link
3. PayPal CEO says firm to 'double down' on digital wallet efforts - Link
4. PayPal shuttering its San Francisco office - Link
5. CFTC Sets May Roundtable to Weigh Ideas Sparked by FTX’s Derivatives Push - Link
📈 Top 10 Market Movements by Market Cap over the last 7 days 📉:
Bitcoin: Price OHLC
We are all seeing continued chop in Bitcoin's on-chain data. See this same chart for each week this entire year where I noted that it was approaching the highs from early January--it did not last. You can see above that Bitcoin has not broken above the $48k amount in 2022. I continue to remain bearish short term but as I have previously stated that I am planning to take a hard look starting now in the May / June time frame.
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. I still do not think we are at the trough point.
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.
Ethereum: Price OHLC
OHLC is the Open, High, Low and Close price. ETH is still chopping around just like Bitcoin above and you can see here it is off the highs of the prior weeks and also down the the year of 2022.
Total Value Locked (USD) in DeFI
Week over week you can see the same story in DeFI with chop between 75 Billion and 84 Billion at the high.
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.
Products I Personally Use and Support
Green Tea Tidbits:
The scientific name for green tea is Camellia Sinensis.
Disclaimer:
This Newsletter does not provide, and no portion of this content purports to be, individualized or specific investment advice and I do not provide investment advice. All information provided herein is general in nature and is made without regard to individual levels of sophistication or investment experience, investment preferences, objectives or risk parameters and without regard to the suitability of the content for individuals or entities who may access it.
No information provided herein, should be construed as an offer to sell, or a solicitation of an offer to buy any security or investment vehicle, nor should it be construed as tailored or specific to you, or any reader or consumer thereof. You understand and agree that the content does not constitute specific recommendations of any particular investment, security, portfolio, transaction or strategy, nor does it recommend any specific course of action is suitable for any specific person or entity or group of persons or entities.
The content herein is based upon information from sources believed to be reliable and I am not responsible for errors, inaccuracies or omissions of information; nor is it responsible for the accuracy or authenticity of the information upon which I rely. For informational purposes only. Do your own research.
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