2023.49 - Edging
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IMHO
Rumors about Bitcoin ETF(s) have been edging us with expectations of imminent approval of one (maybe all) ETFs no later than January 10th, expect this to intensify. If this is your first cycle you'll need to temper your expectations.
UPDATE: as reported by @Reuters, final details of Spot #Bitcoin ETF’s are nearly finished.
— Andrew (@AP_Abacus) December 7, 2023
- approval now 99.9%
- @BlackRock will make it 576-1.
- SEC lawyering all but done.
Don't get me wrong I'm more bullish than most, but this is not my first rodeo. The flood of hopium headed your way will mess with your emotions.
JUST IN - Bloomberg: This "is just the start of a fresh crypto supercycle" that will push #Bitcoin "above $500,000" 🚀
— Bitcoin Magazine (@BitcoinMagazine) December 4, 2023
This $500k price prediction by Bloomberg is not even the most outlandish one I've seen by a "big name". While it's absolutely possible it could happen, extra care must be taken to "not get high on one's own supply" if you know what I mean.
And we're just getting started. This is not even the "mania" part of the cycle yet. How do we know?
a) Google Trends.
Bitcoin trading $43k and this is what google search trends for Bitcoin look like.
— Will (@WClementeIII) December 5, 2023
There will be nasty corrections along the way, but this is not euphoria. pic.twitter.com/IdJhuc4h8J
b) Most mainstream media is still largely clueless
I find it hilarious that they can publish a chart like this and continue to completely write the asset off 😂
— Stack Hodler (@stackhodler) December 9, 2023
The 9th largest asset by market cap.
Bigger than Facebook, Tesla, Visa, Berkshire Hathaway, LVMH, etc.
And yet they still compare it to a lottery ticket or betting on… pic.twitter.com/TKNqqL5QS9
c) You see people like Owen Benjamin who've done just enough homework to produce midwit takes, shielded by Brandolini's Law
I think bitcoin was made so when people saw weakness in the dollar, instead of buying the solution, gold and silver, they put their money into a currency backed by a computers inability to do a math problem. It’s actually genius and how they will most likely be able to refinance…
— Owen Benjamin 🐻 (@OwenBenjamin) December 10, 2023
"Brandolini's Law, also known as the "Bullshit Asymmetry Principle," states the amount of energy needed to refute false or misleading information is an order of magnitude (10x) greater than to produce it."
d) Investors may have gotten the memo that there's no need to go "all-in" and decided they want a piece of Bitcoin's NGU (Number-Go-Up) Technology…
Share this chart with your financial advisors (and the disclosures below).
— VanEck (@vaneck_us) December 10, 2023
Based on your risk tolerance and investment objectives, the addition of #Bitcoin, even in small increments like 0.5%, 1.5%, 2.5%, and 3%, has the potential to alter the dynamics of the traditional 60/40… pic.twitter.com/mfLFsmD4LK
…but they still can't be bothered to understand what they're getting into.
Had a call with a financial advisor and asked him why his clients haven't bought Bitcoin yet if the ETF is obvious:
— Steven Lubka ☀️ (@DzambhalaHODL) December 8, 2023
"They don't want to buy the Bitcoin they just want to buy the ETF. No one with substantial wealth has the time to figure out the asset itself"
Bullish
It seems safe to conclude we're still in the early days in this bull market.
There are a few factors that will be used to keep edging you even beyond the ETF and you may as well prepare for them:
Institutional FOMO: This cycle will be the "second touch point" for institutions who passed on Bitcoin last cycle.
Ignoring Bitcoin at first is a rite of passage for most Bitcoiners. Forward looking institutions may have felt like geniuses and laughed smugly at Microstrategy all through the bear market, but they won't be able to ignore the numbers.
The consequences of ignoring Bitcoin are only starting.
— Alpha Zeta (@alphaazeta) December 4, 2023
Quick results since @Beiwatch1 @FossGregfoss @JoeCarlasare and I have recommended a hypothetical Bitcoin allocation to these pension funds.
This is $1.7bi missed by Wisconsin and $1.8bi missed by Ontario Teachers if… pic.twitter.com/qYvbuaVt86
Pressure Release: There is currently a lot of regulatory pressure coming from BS-slinging, power-addicted, cantillionaire hypocrites and their paid-for politicians. Whenever and however this is resolved it will mark a green light for capital that's sitting on the sidelines just because of these issues.
"There’s a new threat out there, it’s crypto and it is being used for terrorist financing and it is being used for drug trafficking. We can’t allow that to continue.” —Elizabeth Warren
“Our witnesses are the CEOs of the largest banks in The United States.”
— Peter McCormack🏴☠️ (@PeterMcCormack) December 7, 2023
- Senator Xi Jin Warren
🤡🤡🤡
pic.twitter.com/vuZaNCxsiq
"If I were the governments, I'd close it down" —Jamie Dimon
I'll take a moment here to respectfully refer Mr. Dimon to last week's newsletter and remind those of you just tuning in that JPMorgan managed to come in second place in the prestigious "which bank can pay most fines" race with a staggering $39 Billion, out of which $365 Million (and counting) went to Jeffrey Epstein victims, on account of JPM facilitating his pedophilia-based extorsion empire for over 15 years.
Since 2000, regulators fined banks 7,400+ times totaling to fines of $380+ Billion, about 1/3rd of the total crypto market capitalization today.
— Gabor Gurbacs (@gaborgurbacs) November 21, 2023
Either banking is criminal by definition or the rules are broken. The crypto space looks like a nunnery by contrast. pic.twitter.com/fKayIhtkxh
All of which is a long way of saying Mr. Dimon can go fuck himself.
Moving on.
Unlubed "soft landing" Once the kimono falls open and the width and breath of the upcoming recession comes into view, scarce assets that can't be printed by governments will catch a serious bid (Bitcoin is deemed likely to be the fastest horse in that race).
There will be red flags on the path to recession. Ones that we will look back on and say, of course, it was so obvious.
— James Lavish (@jameslavish) December 5, 2023
This is one of them. https://t.co/1yajuR9nxS
Novel Narratives: Whatever your reasons for being bullish now, expect new reasons to appear, like being a carbon negative asset, (is that even a thing?), or AI using Bitcoin, or some other unexpected thing.
Growing list:
— Daniel Batten (@DSBatten) December 7, 2023
There are now 14 known companies doing greenhouse negative #Bitcoin mining
They actually reduce emissions, because they use flare-gas as their power source
The 14th is Scilling Mining, who use vented gas from farms
Did I miss anyone? pic.twitter.com/Oiy2LfH9sg
Pissing Contests. There are rumors of sovereign funds accumulating Bitcoin. So far they are unconfirmed, somewhat wild and probably overstated. But at some point it will happen. And as they say "he who panics first panics best", you may not want to be the first sovereign to start stacking sats but you definitely don't want to be the last.
I CAUGHT UP with a big #bitcoin -er & investor in bitcoin infrastructure cos who said he doesn't think this rally is all about the spot ETF. He thinks it's abt this👇too. I missed this at the time--but looking into it this morning, it seems there wasn't much coverage at the time. https://t.co/g7Pg2y69Eq
— Caitlin Long 🔑⚡️🟠 (@CaitlinLong_) December 6, 2023
I'll leave it here for now, this is going to be a WILD ride. Managing your emotions will be key and being comfortable with your custody and investment thesis will be critically important. You know where to find me if you need help.
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Bitcoin News
Hodling
El Salvador produced a great explainer of why they're holding on to their Bitcoin for the long term.
Write it down why you are hodling and how long you plan to hodl for. You will use this as a reminder more than once this cycle
Why we don’t sell our #Bitcoin?
— Nayib Bukele (@nayibbukele) December 8, 2023
¿Por qué no vendemos nuestros #Bitcoin? pic.twitter.com/2QW0dUU6np
Oceanic Drama
Ocean, a new mining pool that was launched only last month has been generating wave after wave of Drama.
The short story is: it's a pool that aims to reduce centralization in mining pools which is great, but the way they build blocks filters out inscriptions and Whirlpool transactions, which sucks.
There are decent arguments on both sides but unfortunately it comes down to picking between two bad choices. I hope this gets resolved, but the personalities involved make this seem unlikely.
It's amazing how much mud people are slinging at OCEAN.
— Mechanic #Nuremberg2 (@GrassFedBitcoin) December 6, 2023
It's permissionless. >51% of mining is with fully KYC pools.
Maybe fight that battle instead of insisting we include OP FALSE spam?
Ben Carman wrote a piece on the situation which I'm in general agreement with, I'll summarize the main points below:
Inscriptions: the cure is worse than the diseasehttps://t.co/Z7n0jafVVs
— Carman (@benthecarman) December 10, 2023
- There are good arguments to consider Inscriptions —which "hijack" a feature in Bitcoin script— as an attack on Bitcoin
- Most proposals to stop inscriptions boil down to preventing them from getting into the mempool
- The mempool should be preserved as THE vehicle for miners to find the most profitable transactions to mine
- Filtering transactions based on arbitrary "spam criteria" can lead down a dark, regulatory path
- We should patiently wait for Inscriptions to be priced out
Tracking
Ledger Live has been found to use extensive tracking, Apparently so do most web wallets (Trezor and Metamask included). Solution use your hardware wallet with a desktop wallet like Sparrow, instead of web-based wallet software.
GM frens!!!
— REKTBuildr 🔺🔺🔺 (@rektbuildr) December 7, 2023
Past few hours I've been working on a clean version of Ledger Live
The amount of user tracking code in it is overwhelming. They track everything. There's tracking even when you look at parts of the screen.
I want a Ledger Live that'll simply install and uninstall… pic.twitter.com/NEFKJljRVS
Not Thrilling, But Nice
Bitkey, a new wallet slution by Square was just released. The design seems clever in terms of making it unlikely users will lose their keys, but has fairly significant flaws like not having a screen on the hardware component —I won't dig down into why this is a weakness here, but it is.
Block opens preorders for its new hardware wallet, Bitkey. Expected to ship early 2024.
— TFTC (@TFTC21) December 7, 2023
Bitkey is a 2-of-3 multisignature design. One key is held on a mobile app, one is held on a hardware device, and the third key is held on Bitkey's server. pic.twitter.com/yCO6uAm7VP
First impression seems to be it may be a decent option for non-technical and non-privacy minded folks who don't yet understand why KYC can be dangerous. We'll keep an eye on this one.
Hard Life of a Troll
Eric Wall is one of the few "Bitcoin Trolls" I recommend following. I don't always agree with him by any stretch, but he has a deep understanding of Bitcoin and often forces uncomfortable but important discussions. If you are new-ish here you may not always understand what he's talking about. I hope it motivates you to level-up.
I didn’t intend for it to be this way. I want us all to work together. If you’ll bare with me a few moments, I’ll explain how we ended up here.
— Eric Wall | CVE-2023-50428 (@ercwl) December 10, 2023
It all started when I tried to bring up the idea of zkrollups as a scaling layer to Bitcoin: https://t.co/8PiGST2h0X
Real Measure
When someone asks me "What is a Bitcoiner?" my answer is "they measure their wealth in Bitcoin"
After lamenting not pulling the trigger on $36k #Bitcoin while waiting for a 10% pullback, Gary Cardone now uses #Bitcoin as a unit of account 👀
— Bitcoin News (@BitcoinNewsCom) December 6, 2023
pic.twitter.com/TwJdZf3tNF
Please Comment
If you are a US citizen, please take 5 minutes to comment on these proposed regulations (the link explains what they are), your future self will thank you
This took weekS to put together.
— Preston Pysh (@PrestonPysh) December 6, 2023
If you’re in #Bitcoin please read and take ACTION.https://t.co/RbSNqUzwjm
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"Crypto" News
The jokes often write themselves
Stable Game
Calling Coinbase's wallet decentralized is hilarious but OK.
Coinbase's decentralized wallet now lets you send USDC for free using iMessage, WhatsApp, etc
— Jeff Roberts (@jeffjohnroberts) December 5, 2023
This is a potentially big development as it removes complexity for cross-border paymentshttps://t.co/XaPHcaHWW6
Speaking of stables, Tether is now being a model citizen and freezing OFAC-censored wallets.
Tether freezes all OFAC-sanctioned wallets in 'proactive' security measure https://t.co/Ojitj3L8Oh
— The Block (@TheBlock__) December 9, 2023
this is perhaps not all that surprising after witnessing the vigor with which Binance is being anal-probed by regulators.
Breaking News: A Binance Double Whammy. 1) Newly Unsealed US DOJ Filings Could Mean the End of Binance; and 2) SEC Files Supplemental Pleading Against Binance, Strengthening the SEC Binance Lawsuit Exponentially
— John Reed Stark (@JohnReedStark) December 9, 2023
There’s been a flurry of newly released Binance-related filings… pic.twitter.com/igN2I9Y7cP
Speaking Of
Maybe Logan Paul should take a hint and make haste with his promised restitutions.
In January, Logan Paul announced a $1.5 million plan to compensate investors after his crypto NFT project 'CryptoZoo' reportedly rugpulled.
— Watcher.Guru (@WatcherGuru) December 8, 2023
11 months later, no money has been returned. pic.twitter.com/1B2z3EIYi1
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Fiat News
US Banks
BTFP, the facility where the Fed offers banks loans against their underwater UST holdings keeps growing, signaling a need for liquidity from banks.
bank term funding program outstanding loans rose to $121B this week, up from $113B the week before
— Peruvian Bull (@peruvian_bull) December 8, 2023
but yes, there's definitely no issues with bond losses on bank balance sheets 🙃 pic.twitter.com/JgS39Ekyrk
and this "bank walk" is probably why.
This is now the longest continuous drop in bank deposits in US history.
— Joe Consorti ⚡ (@JoeConsorti) December 10, 2023
Banks have had a 0% reserve requirement since March 2020 so this hardly matters.
NORMALLY lending would grind to a halt due to loan collateral flight.
Now the party rages on, forever, and YOU are pillaged. pic.twitter.com/RsVtKnHveQ
CHAYNA
Chinese banks are also in pain, as is its stock market.
China is experiencing a full banking system collapse. With Local Government debts exceeding $13trillion USD equivalents (90% are in default) and $4 trillion in real estate losses, China only has $2trillion in bank equity. U.S. lost $800 billion in the GFC. #China #Collapse 1/3
— 🇺🇸 Kyle Bass 🇹🇼 (@Jkylebass) December 8, 2023
The Shanghai Composite fell nearly 2% after Moody's cut its outlook on China's credit rating.
— The Kobeissi Letter (@KobeissiLetter) December 9, 2023
Since June 2023, China has seen all of these events:
1. Evergrande files Chapter 15 bankruptcy
2. Largest tax cuts since 2008 announced
3. Interest rates lowered on $6 trillion of… pic.twitter.com/kAp6Nro272
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Dystopian News
The Cyber
China "has invaded" critical US infrastructure. Sounds like someone is preparing to blame someone else for a shitstorm
The cyber pandemic narrative is getting warmer in the bullpen. pic.twitter.com/7p0i7CpI2E
— TFTC (@TFTC21) December 11, 2023
Stay
The carbon passport will not apply to the rich. Bet.
You will own nothing, travel nowhere, and be an obedient tax-paying slave.
— Why Carnivore 🥩 (@WhyCarnivore) December 6, 2023
PS: when they say “we” what they really mean is “you”. They will continue to fly around in their private jets, dumping as much carbon as they please. pic.twitter.com/cuAlir700V
Thoughtcrime
Plenty of dystopian news coming out of Ireland lately, expecto more if this "Free Speech" bill goes through —don't you love how they always name bills the exact opposite of what they actually do? Almost funny.
It sounds like a "Black Mirror" episode: a small country announces a crackdown on hate speech to seize control over the entire Internet.
— Michael Shellenberger (@shellenberger) December 6, 2023
Except it's not a "Black Mirror" episode. It's real life. And it's happening right now in Ireland.
The so-called "Hate Speech" bill isn't… pic.twitter.com/YsqFJRVtGL
Syke
What was Google thinking?
They announced Gemini, an AI that looked like it could be a 5-year old's best friend and then it turned out the video was fake? The Simulation is definitely getting weird.
Google vs. Mistral: a tale of two AI launches and a case study in knowing your audience
— Lulu Cheng Meservey (@lulumeservey) December 9, 2023
Google announced their new model two days ago. It was named Gemini, and it wafted in with a blog post, brand guidelines, a press tour, and a polished sizzle reel that later turned out to be… pic.twitter.com/5v5EzOTDbB
Limitless
Here's a fun thought experiment (I think the number below is wrong): Find out what the daily ATM withdrawal limit is for your Bank, then calculate how long it'd take you to withdraw $1.6 Million
Hunter had $1,664,004 in “ATM/Cash Withdrawals”, spent $683,212 in payments to “various women” and $188,960 on “adult entertainment”.
— zerohedge (@zerohedge) December 8, 2023
How the hell do you withdraw 1.7 million from an ATM? That's like 4000 daily trips, or every day for 11 years
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Price News
Bitcoin Surfing
Bitcoin jumped hard last week, only to come back down (almost) just as hard. After crossing the $44k mark, it tumbled suddenly and currently sits near $41k, still above the Board ($38k)
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Dip Fishing
After crushing through the $42k Resistance BTC jumped to $44k before reversing suddenly back below $42k. If you're trying to trade this, don't.
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Calm Chart
Despite the price violence, December remains Green.
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