GM and welcome to The Crypto Nutshell! 🫶 🥜 

The crypto newsletter that's less dramatic than waking up as a mob boss managing a family and a criminal empire... 👔🚬 

Today, we’ll discuss:

• BlackRock secretly buying Bitcoin? 🪨 

• Two Bitcoin catalysts on the horizon 🌅 

• Short-term holder’s in loss 📉 

• And more…

MARKET WATCH ⚖️

Only the top 20 coins measured by market cap feature in this section

BLACKROCK SECRETLY BUYING BTC 🤫 

JUST IN: Blackrock’s Investments In Bitcoin Mining Companies Revealed

While everyone is eagerly awaiting the decision on the spot Bitcoin ETFs, it’s come to light that BlackRock has been secretly accumulating significant holdings in Bitcoin mining companies.

The world’s largest asset manager is said to now hold approximately $600 million dollars worth of shares in 4 of the 5 largest Bitcoin mining companies.

Greenpeace International reported it’s findings from research on BlackRock investments:

“Greenpeace USA research finds that BlackRock controls nearly $600 million worth of shares in Bitcoin mining companies and has shares in most of the large publicly traded miners. These investments are vital for mining companies to access funding for their energy-intensive facilities.”

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EXPERT OF THE DAY 💰

Cathie Wood believes that Crypto has two major tailwinds that not many people are talking about. 👻

If this is your first time hearing about Cathie Wood, here’s a quick rundown of her resume:

• CEO & Founder of ARK Invest, an investment management firm famous for their on innovation

• Has over $14 billion in assets under management

• Was the first public fund manager to invest in Bitcoin, back in 2015

• Has a bull case price target for Bitcoin of: $1.48 Million by 2030

• Has price target for Ethereum of $165,000+ 🤯

This week, she was interviewed by Barron’s. Within it she broke down two catalysts for Crypto that are on the horizon.

These are:

1. Crypto has become a bipartisan issue. Both republicans and democrats are in favour of crypto & the innovation it brings.

With 2024 being an election year, Crypto is going to become a larger issue and it has support from both sides.

Cathie is confident that despite the SEC’s attack on Crypto, it will be overruled by the Supreme court. (This is a large part of the reason why Cathie & ARK invest are buying up more shares in Coinbase. They are confident they will win their lawsuit against the SEC.) 🧑‍⚖️ 

2. At the end of the day, crypto & the blockchain technology it uses is just better. It's a more efficient way of transacting value.

Financial transactions today, on average, go through 7 intermediaries between a consumer & merchant. All of which take a percentage of the transaction. 🏦 

Crypto cuts out all these middlemen, allowing the costs of transactions to collapse.

Cathie argues as crypto is such a better alternative, it is inevitable. 

Nutty’s takeaway: Cathie brings up a good point in highlighting 2024 as an election year and what that means for Crypto.

For the first time, Bitcoin & crypto will be an issue that needs to be addressed. As Cathie points out, Bitcoin & crypto is widely supported by both the republicans and the democrats.

Many nominees are openly supporting or holding crypto. Ex-president Donald Trump even released an entire NFT project & is a holder of Ethereum!

Another thing to be wary of, election years generally see interest rate cuts & an increase of money printing. Monetary stimulus is often used as a tool to sway votes.

A higher liquidity environment = higher prices in crypto. 😎 

ON CHAIN DATA DIVE 📊

About 10 days ago Bitcoin suddenly crashed and has been trading at around the $26,000 mark ever since.

This crash hit short term holders the hardest. Lets jump into the Net Unrealized Profit/Loss Ratio (NUPL) and see the impact for ourselves.

Before we go any further, we need to know how this metric works.

NUPL looks at the difference between the price when a coin last moved vs the current market price, from this we can determine if each coin is in a state of unrealized profit (price has gone up) or unrealized loss (price has gone down).

The chart below focuses on short-term holders. This allows us to see if investors who have held Bitcoin for less than 155 days are in profit or loss.

Values above 0 mean that we are in a state of net profit 🤑 

Values below 0 mean that we are in a state of net loss 😢 

Glassnode colour codes this chart to help investors make informed decisions. The further NUPL is away from zero, the closer we are to market tops and bottoms. Blue is the optimal time to take profits (closest to 1) and red is the optimal time to re-enter the market (less than 0).

So taking a look at the chart above you’ll notice that the NUPL has been in the red zone ever since the price of Bitcoin dipped on 16th August. This means that short-term holders are currently in a state of unrealized loss… ouch.

The short-term NUPL is currently at -0.085. 📉 

Don’t be alarmed though. It’s not all doom and gloom.

If we extend the NUPL and include long-term holders into the equation you’ll notice that it’s currently in the yellow/orange zone (profit…yay). 📈

The overall NUPL is currently at 0.24 and indicates that as a whole the Bitcoin Network is still in a state of profit. 💰️ 

Nutty’s Takeaway: Short-term holders are more sensitive to sharp price movements in Bitcoin. This is why looking at the short-term NUPL can often make the current market situation appear worse than it actually is.

Always remember to zoom out when you can. It’ll put things like this “crash” into context.

CRACKING CRYPTO 🥜

TRIVIA TIME ✍️

In 2022, the Ethereum Merge shifted the Ethereum blockchain from a proof-of-work consensus mechanism to a ______ model.

• A) Proof-of-steak

• B) Proof-of-importance

• C) Proof-of-stake

• D) Proof-of-capacity

Find out the answer at the bottom of this newsletter 😀

MEME CORNER 😂

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

Trivia Answer: C) Proof-of-stake 🎉

The “Merge” shifted the Ethereum blockchain from the proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) model intended to be faster and more energy efficient. For further reading click here.

NUTCASE REVIEW OF THE DAY 🔍

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.