GM to all of you nutcases. It’s Crypto Nutshell #774 testin’ the waters… 🧪🥜

We’re the crypto newsletter that’s more suspenseful than a shark circling silently before the first scream… 🦈🌊

What we’ve cooked up for you today…

What’s in the Crypto Nutshell Portfolio?

BREAKING: Bitcoin Drops Below $89K Amid Fading Risk Appetite Ahead of Key Macro Events

Bitcoin slipped below $89,000 over the weekend as traders brace for what could be the next major macro risk.

The Bank of Japan meets on Thursday. And if history is any guide, a rate hike could send Bitcoin much lower.

Every time the BOJ has raised rates since 2024, Bitcoin has dropped over 20%.

Now the BOJ is widely expected to hike again, lifting rates to 0.75%.

And analysts are warning the pattern could repeat.

Why are Japan’s interest rates such a big deal?

Simple.

For years, traders borrowed yen at near-zero interest rates, converted it to dollars, and used that cash to buy Bitcoin, stocks, and other risk assets.

This "carry trade" flooded global markets with cheap liquidity.

But when the BOJ raises rates, borrowing yen gets more expensive. The yen strengthens. And suddenly those trades stop working.

Traders are forced to unwind: sell their Bitcoin, buy back yen, repay the loans.

That drains liquidity from the system fast. Leverage gets cut. Risk-off takes over.

And multiple analysts are now targeting $70,000 as the next downside level if the BOJ hikes as expected.

Markets are already positioning defensively.

Bitcoin is down roughly 7.6% over the past month and trading with subdued volume. Altcoins are bleeding harder - SOL, XRP, DOGE, and ADA all show double-digit monthly losses.

ETH is holding slightly better, outperforming Bitcoin on a weekly basis, but the broader market remains weak.

Crypto analyst Ali Martinez flagged $86,000 as a critical support level. If that breaks, a deeper pullback accelerates fast.

Meanwhile, the macro calendar is stacked this week.

U.S. unemployment data, ADP employment figures, November inflation numbers, and December flash PMI readings all drop before the BOJ decision on Thursday.

Fed Governors Stephen Miran and Christopher Waller are also scheduled to speak, adding more uncertainty around the rate path.

So where does that leave Bitcoin?

Short term: range-bound and fragile. Markets are in wait-and-see mode with thin liquidity and no conviction.

Medium term: the BOJ decision is the biggest risk on the board. If they hike and the yen surges, the carry trade unwind could drain liquidity fast.

And if $86,000 breaks, the path to $70,000 opens up.

Bitcoin doesn't care about Powell's words or Treasury purchases right now.

It cares about liquidity. And Thursday could determine how much of it disappears. 🚀

Markets don’t wait — and year-end waits even less.

In the final stretch, money rotates, funds window-dress, tax-loss selling meets bottom-fishing, and “Santa Rally” chatter turns into real tape. Most people notice after the move.

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That’s the question everyone asks at exactly the wrong time.

This week, Fred Krueger weighed in.

For newer readers:

Fred Krueger is a mathematician, serial entrepreneur, and long-time macro thinker.

He’s known for probability-based thinking and for staying calm when markets get chaotic. When Fred speaks, it’s usually worth listening.

Here’s what he tweeted:

That’s the uncomfortable truth.

Bitcoin can go lower.

But waiting for the perfect buy price has been the most reliable way to miss the move for 15 years straight.

Every cycle feels fragile while you’re inside it. Every major run only looks obvious in hindsight.

Fred’s point isn’t about price tomorrow.

It’s about behavior.

If you’re constantly asking “what if it goes lower,” history suggests one thing:

You’ll still be asking it when price is much higher.

Zoom out.

Think in probabilities, not emotions.

Will Bitcoin be higher in 5 years time? How about 10?

We think the answer is obvious. 🔍

Let’s kick off the week with a look at the Bitcoin HODL Waves - one of the clearest snapshots of market conviction.

Each coloured band represents the percentage of Bitcoin that last moved within a specific time frame.

The cooler the colour, the older the coins - with purple showing Bitcoin that hasn’t moved in 10+ years.

Today we’ll be focusing on long-term holders (LTHs) - defined as coins held for more than six months.

Here’s how the Bitcoin supply breakdown looks today compared to two weeks ago:

TL;DR: 65.39% of all Bitcoin has not moved in over six months. 🔒

That's up 0.06% from two weeks ago. Basically flat.

The story here is stability, not capitulation.

The youngest LTH cohort (6-12 months) ticked up slightly as coins continue aging into this band. The 1-2 year group is growing too - coins maturing into stronger hands rather than returning to exchanges.

Meanwhile, the mid-cycle bands (2-5 years) saw minor trimming.

And the deep storage bands? Still climbing. The 10+ year supply pushed higher again, now holding 9.17% of all Bitcoin.

This is what conviction looks like during a pullback. No exodus. No panic. Just coins quietly aging into dormancy whilst short-term traders do their thing.

Bottom line: supply is locked, long-term holders aren't flinching, and the base keeps strengthening. 💎

Firedancer is live, but Solana is violating the one safety rule Ethereum treats as non-negotiable. Firedancer could start a new wave of adoption for Solana, especially from institutions that see a mitigated centralization risk from its validators.

Bitcoin’s four-year cycle is intact, but driven by politics and liquidity: Analyst. Bitcoin’s four-year cycle is intact but no longer halving-driven, says 10x Research’s Markus Thielen, pointing to politics, liquidity and elections.

Barclays Sees ‘Down-Year’ for Crypto in 2026 Without Big Catalysts. Spot trading volumes are cooling, and investor enthusiasm is fading amid a lack of structural growth drivers, analysts wrote in a new report.

Brazil's largest bank recommends a 3% Bitcoin portfolio allocation: 'real diversification'. A partner at the investment arm of Itaú Unibanco, the largest private bank in Latin America, is urging investors to allocate a portion of their portfolios

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Select your answer below and you’ll be redirected to the results page. (answer explanation can be found after “Meme Corner”)

Because what would the crypto world be without its share of memes?

Trivia Answer: 10,000 BTC 🥳

On May 22, 2010, Hanyecz paid 10,000 BTC for two Papa John's pizzas. At today's prices, that's around $900 million worth of Bitcoin.

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DISCLAIMER: The content of this newsletter is not financial advice. This newsletter is strictly educational and is not investment advice. Please be careful and do your own research.