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GM to all of you nutcases. It’s Crypto Nutshell #852 uncoverin' the angle… 🔦🥜

We're the crypto newsletter that's more dizzying than a staircase that loops back on itself no matter how far you climb… 🌀🪜

What we’ve cooked up for you today…

What’s in the Crypto Nutshell Portfolio?

BREAKING: Bitcoin posts worst first quarter since 2018, falling 24%

Bitcoin fell 24% in Q1 2026. That’s the worst first quarter in eight years.

From $87,500 on January 1 to $66,600 by the end of March.

Combined with Q4's 23% slide, that's a 42% decline in six months.

ETF outflows, sticky inflation, a cautious Fed, and the Iran war all played a part.

But something changed in March…

Bitcoin closed the month 2% higher, snapping a five-month losing streak. The last time BTC printed that many red monthly candles in a row was 2018.

What followed back then was a 300%+ rally over five months…

ETF flows flipped too.

March saw $1.32 billion in net inflows, the first positive month since October.

And despite a 50% drawdown from the highs, ETF holdings only dropped 7% at their lowest point before partially recovering.

Even the derivatives market is telling a similar story.

Funding rates, the cost traders pay to hold leveraged long positions, have been negative for 32 straight days.

That means shorts are paying to stay bearish. When that gets this crowded, it usually marks a bottoming phase, not the start of more downside.

K33 Research calls the current setup "aggressive caution."

Short ETF exposure just hit its second-highest level ever. Traders are piling into downside protection at a pace that historically precedes reversals.

But none of this guarantees a bounce.

ETF investors are still underwater with an average cost basis near $84,000. And K33 flagged that the Easter period typically brings lower volume and thinner liquidity, which could keep things choppy short term.

But the structure is changing.

Q1 was brutal. March was the first crack of light. 🚀

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3 words. That's all Raoul Pal needed to explain why Bitcoin is inevitably going higher.

Pal is a former Goldman Sachs macro trader and the founder of Real Vision.

He's spent his entire career tracking the one variable that drives every major asset class on the planet: global liquidity.

And in his latest appearance on Forward Guidance, he made the case as clearly as he ever has.

Think about what he's actually saying. The system cannot allow a sustained collapse.

The world is too indebted. The leverage is too deep.

The moment things start breaking, central banks and governments have no choice but to step in and flood the system with liquidity.

It's not a question of if. It's a when.

And Pal explained the mechanism behind it.

In a world drowning in debt, the only way to avoid a catastrophic collapse is to quietly debase the currency. Every year. Consistently.

That's the playbook. That's what governments have been doing. And that's what they will keep doing. Not because they want to. Because they have to.

And what happens when currencies get debased at 8% per year?

Cash loses purchasing power. Bonds lose real value. And hard assets, the ones that can't be printed, go up.

Gold knows this. It just hit all-time highs.

Bitcoin knows this too. It just hasn't caught up yet.

That's the entire thesis in 2 sentences. Liquidity always comes back.

And when it does, the assets with fixed supply and no counterparty risk are the ones that capture the most upside.

Pal has been saying this for years. The math hasn't changed. The direction hasn't changed.

The only thing that changes is the size of the opportunity for those paying attention. 🚀

Time for check in on Ethereum’s supply side dynamics.

To do that we’ll be focusing on the amount of Ethereum currently being staked.

Quick Note: Ethereum staking involves locking up ETH to support the blockchain’s security. In return, users earn rewards for staking.

If you’d like to learn more about staking, check out this article.

38.58 million ETH is now locked in staking. That's up 2.59 million ETH since the start of 2026.

Over 2.5 million ETH committed to staking in a few months - during one of the most punishing stretches for holders in recent memory.

31.97% of the entire supply is now staked.

And that number isn't plateauing. It's accelerating. The pace of staking has picked up even as price has trended lower - the exact opposite of what you'd expect if conviction was breaking.

Pair that with exchange balances still draining, and the maths gets stark. Nearly a third of all ETH is locked. And every week another chunk of supply gets pulled out of circulation.

The market is pricing in fear. The staking data is pricing in commitment. One of them is wrong. 🚀

These Three Altcoins Just Got Leveraged Crypto ETFs. The company that launched the first leveraged crypto fund in the U.S. is expanding its roster to include a few smaller digital assets.

Meta’s 2026 Stablecoin Plan: Why It’s Partnering, Not Issuing. Meta’s 2026 stablecoin push favors partnerships over issuing its own coin. Here is why the company is choosing infrastructure and distribution instead.

'Not an April Fools joke': Major Solana-based trading platform Drift exploited for at least $200 million. DRIFT is down nearly 5% to $0.064, according to The Block’s data.

Franklin Templeton launches crypto division with 250 Digital acquisition. The asset manager is creating a new “Franklin Crypto” unit to expand beyond ETFs and target institutional demand for active digital asset strategies.

Want to get even smarter? Check these out.

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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: 11 🥳

The SEC approved 11 spot Bitcoin ETFs simultaneously on January 10, 2024, including products from BlackRock, Fidelity, Grayscale, and others. It marked a watershed moment for institutional crypto access in the US.

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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.