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- 🥜 Crypto has 2 major problems...
🥜 Crypto has 2 major problems...
PLUS: Gary Gensler claps back
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Today, we’ll be going over:
👊 Gary Gensler claps back
🦈 Crypto has 2 problems
💸 Short-term holders are once again back in the green
🤑 And more…
MARKET WATCH ⚖️
Prices as at 5:30am ET
Only the top 20 coins measured by market cap feature in this section
GARY GENSLER CLAPS BACK 👊
BREAKING: Gensler remarks: ‘don’t get me started on crypto’ reaffirming most digital assets are securities
Following on from Coinbase’s court filing yesterday. SEC Chair Gary Gensler doubled down on his stance regarding crypto assets.
To him: crypto assets are securities. Annnd it looks like he won’t be changing his mind anytime soon…
“Without prejudging any one asset, the vast majority of crypto assets likely meet the investment contract test, making them subject to the securities laws.”
Coinbase has been vocal in claiming that the exchange of crypto assets does not imply an "investment contract". Gensler strongly disagrees and believes crypto exchanges are violating securities laws.
“Further, it follows that most crypto intermediaries—transacting in these crypto asset securities—are subject to the securities laws as well.”
However it appears that the SEC is divided on it’s decisions regarding crypto. Just 3 days ago SEC commissioner, Hester Peirce had this say regarding the Bitcoin ETF’s:
“I’ve been thinking we should approve one (Bitcoin ETF) for the last 5 years. The logic for why we haven’t has always mystified me.”
This seemingly goes against exactly what Gary Gensler’s been saying…
Has ol’ Gary Gensler completely lost the plot? 🤔
For the full article click here.
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CRYPTO HAS 2 PROBLEMS🦈
Mark Cuban believes that crypto has 2 problems it needs to address.
In a Wired interview just yesterday, the Shark Tank star was asked:
“Do you think crypto is dead? Yes or no?”
Mark’s answer?
“No. Hell No.”
However, crypto has 2 problems:
Mark argues that most people are in crypto for the money. The space is entirely about speculation. That’s not what crypto is really about.
Crypto hasn’t had its ‘Instagram’ moment.
Mark believes crypto is missing that one killer application.
The iPhone came out in 2007. But it wasn’t until apps like Instagram, Snapchat and Facebook that the iPhone really took off.
The good news?
Because the use cases of crypto are so wide reaching, that ‘killer app’ could come from anywhere.
Whether it comes from DeFi, NFT’s, layer 2’s or crypto gaming…
It could come from anywhere, anytime. 🔮
SHORT-TERM HOLDERS IN THE GREEN 💸
With Bitcoin’s recent price rally to $34,000, short-term holders (STH) found themselves back in the green.
Today we’ll be taking a look at two related metrics (focusing on STH’s):
Market Value to Realized Value (MVRV): looks at the difference between the current value of the supply and the cost basis of the supply. Used to identify unrealized profit or loss.
Spent Output Profit Ratio (SOPR): similar to MVRV but only looks at coins that have actually transacted. Used to identify realized profit or loss.
🟢 Profit: larger numbers mean larger profits
🔴 Loss: lower numbers mean larger losses
MVRV
It’s been a great week for STH’s.
Their cost basis is currently at $28,284, meaning they are now sitting on unrealized profits of ~20%. 🤑
Take a look at the chart below, in particular do you see how deep the losses of the 2022 bear market were?
Comparatively the price dip of August 2023 was shallow, only reaching a low of -10%.
This just goes to show the resilience of the current market (Bitcoin’s price hovered around $26,000 - $27,000 for so long).
SOPR
While MVRV looks at the unrealized profit or loss of STH’s, let’s see what actually happened.
You’ll notice that the chart below looks very similar to the one above. This is because MVRV and SOPR are heavily linked.
The August price dip saw minimal panic selling. Compared to the bear market of 2022 these realized losses are tiny.
Another sign of STH resilience. 💪
With this metric once again moving back into the green, STH’s are locking in profits on average.
Bottom Line: Bitcoin’s price rally to $34,000 has put the market in a much better position (obviously…).
In particular, STH’s are now holding and realizing profits on average. As STH’s are the primary driver of the market, increased positive price action is more likely. 😎
CRACKING CRYPTO 🥜
WHAT WE’RE READING ✍️
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CAN YOU CRACK THIS NUT? ✍️
Have you been paying attention?
Yesterday we discussed a certain Ethereum bull who has changed his mind and has a new favourite coin (Solana). Who are we talking about?
A) Vitalik Buterin
B) Raoul Pal
C) Michael Saylor
D) John Blockchain
Find out the answer at the bottom of “Meme Corner” below 😀
MEME CORNER 😂
Because what would the crypto world be without its share of memes?
Trivia Answer: B) Raoul Pal 🥳
That’s right. Revealed on twitter, Raoul’s new largest holding is now Solana.
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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.
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