🥜 Monumental day for Bitcoin

PLUS: Volatility is coming

August 30, 2023

GM and welcome to The Crypto Nutshell! 🫶 🥜 

The crypto newsletter that's less challenging than leading a group of survivors through a zombie-infested wasteland... 🧟‍♂️🚗

Today, we’ll discuss:

  • Grayscale wins vs the SEC 🧑‍⚖️

  • Crypto expert: volatility is coming🌅 

  • Short-term HODL waves reveal something interesting 🌊

  • And more…

MARKET WATCH ⚖️

Price data as at 7:30am ET

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

BITCOIN’S WORST MONTH 😱 

JUST IN: Grayscale wins SEC lawsuit for Bitcoin ETF review 🧑‍⚖️ 

This is a MASSIVE day for Bitcoin.

Crypto asset manager Grayscale Investments just won their court case against the U.S. Securities and Exchange Commission (SEC) regarding the conversion of it’s Grayscale Bitcoin Trust (GBTC) into a spot Bitcoin ETF.

Back in June 2022 the SEC rejected this proposal from Grayscale. Grayscale then argued that the SEC acted “arbitrarily and capriciously” (aka. unfair and unreasonable) in rejecting spot Bitcoin ETF applications.

What made this decision even more puzzling was that multiple Bitcoin futures ETF applications were being approved.

Grayscale further argued that the SEC violated the Securities Exchange Act with “unfair discrimination” against spot Bitcoin ETF applications.

And here we are today, the decision from the SEC has now been overturned. It’s looking like spot Bitcoin ETFs are now a matter of “when” not “if”

As a result the price of Bitcoin shot up more than 6% (God candle), checkout the price chart below 🤣

This ruling is not only a major WIN for Grayscale but for all institutions that have filed for spot Bitcoin ETFs. The courts decision paves the way for a wave of approvals, the first deadline for many applications is approaching. The most notable being BlackRocks on 2nd September.

Exciting times ahead for HODLers. 😎 

The CEO of Grayscale Michael Sonnenshein had this to say:

In other news (SO much happened overnight), X (Twitter) has secured a currency transmitter licence necessary for them to integrate cryptocurrencies into their platform.

This is a major step forward for Elon Musk’s “everything app”. However no word has been given on what cryptocurrencies X will utilise or how they’ll be integrated. We’ve got a sneaking suspicion DOGE will be one of them… 🐕️ 

Whether you love or hate Elon and X this is bullish news for crypto. A major mainstream platform like X becoming a crypto hub can only be good news for widespread crypto adoption.

TOGETHER WITH THE ROLLUP 💫

Sponsored
The Wall Street RollupYour new favorite Earnings, Finance News, and M&A Transactions Newsletter Blotter from Anonymous Wall Street Professionals

Do you like money? We do too. Obviously 😉 

If you want to make more money, we’re giving a shoutout today to our friends over at The Rollup. 

We’ve got you covered with all the news about Bitcoin, Ethereum & Crypto… but if you want some real juice & deep dives into stocks and investing content, you need to be reading The Roullup.

Every Thursday and Sunday (New York Time) they “rollup” all things investing into an easy to read, fun format. You’ll stay up to date with all the latest news and happenings from media sources like Substack, Twitter and YouTube.

The best part?

Just like us, they’re totally free.

Click that beautiful button and it’ll automatically subscribe you to their list.

If you’re not a fan, you can always unsub. Nothin’ to lose. 😎 

EXPERT OF THE DAY 💰

Today marks a watershed moment for crypto. As you've seen by now, the big news is Grayscale's win against the SEC. 🥳 

While a spot Bitcoin ETF hasn't received the green light just yet, the door is now open for Grayscale to convert their current futures Bitcoin ETF into a spot one.

Plus, the odds of other spot Bitcoin ETF applications getting approved just skyrocketed. 🚀 

Why does this matter?

This morning, Aya Kantorovich broke down what it all means for the crypto space.

If you haven’t heard of Aya, she’s the founder and CEO of Fractal - a company which provides institutional grade data & analytics for digital assets. She also worked at FalconX for years, which built Crypto trading platforms for institutions.

AKA. When it comes to institutions and crypto - she knows her stuff. 🤓 

In the interview, Aya discussed the recent negative sentiment towards crypto. However, today's announcement took the market by surprise and pulled a 180 on global crypto sentiment.

Why? 🤷 

This is a clear sign that the crypto industry is growing up. Finally institutions are getting clear guidelines on how to approach the space.

Aya believes this has set us up for a very volatile Q3 and Q4. Expect lots of activity and news flow coming out surrounding Bitcoin & crypto.

“Really - this is a huge push forward for us. We’ve always said: ‘The institutional wave is coming!’ But it cannot come until we have simple regulated products available in the market and this is a big push forward toward that.” 


Aya Kantorovich

The odds of a spot Bitcoin ETF approval have now sky-rocketed. Once approved, it opens the floodgates for institutions to enter. 🌊 

Aya argues that institutions have been waiting (with their giant bag of money) on the sidelines for regulated paths to Bitcoin and crypto exposure.

This hasn’t been available in the United States. Todays decision changes that.

So what happens now? 🤔 

The SEC has 45 days to reconsider the judges ruling on Grayscales application. They can approve their spot Bitcoin ETF or appeal it to be heard by the US Supreme Court.

What other dates should you look out for? Here’s a table of the upcoming decisions on a spot Bitcoin ETF:

The likelihood of any of these being approved have improved drastically. 📈

Although the SEC could continue to delay and appeal, with them losing court cases left & right, the more likely outcome is an approval.

Hold on tight. The next 6-12 months are going to be explosive. 💥 

Nutty’s takeaway: What should you expect after a spot Bitcoin ETF approval?

Nobody knows for sure, but a good comparison is what happened after the first spot gold ETF (GLD) got approved.

In the 8 years following its launch in 2004, the price of gold went up 359%.

Effect of a spot gold ETF on price of gold

Imagine that. Gold.

The mind boggles at what will happen to Bitcoin. 😉

ON CHAIN DATA DIVE 📊

Investors who have held Bitcoin for less than 155 days are beginning to increase.

Is this a market rejuvenation? Let’s find out.

The Realized Cap HODL Waves are a super useful chart for understanding investor sentiment and market dynamics. Here’s the rundown on how to understand this chart.

Realized Cap HODL Waves shows us the distribution of age and economic weight of the coin supply. It is calculated by taking the total realized value of the coins in each age band as a proportion of the Realized Cap. Today we’ll be focusing on coins held for less than 6 months.

  • Downtrends indicate that long term holders are accumulating (market bottom approaching)

  • Uptrends indicate the long term holders are selling (market top approaching)

  • Sideways trends indicate churn, day to day trading between short term holders

Taking a look at the chart above, we can identify periods where the market has bottomed and subsequently the amount of short term holders has increased. 🤔 

As of today short-term holders (less than 155 days) make up 29.77% of the total realized cap. This is an increase of 8.93% from January lows.

So what does this mean?

This trend of increasing short-term holders historically happens post cycle bottoms. Usually we’ll see a trend of FOMO (Fear of Missing Out) among investors and a rapid increase in interest and on-chain activity.

Nutty’s Takeaway: We love this chart. In fact it’s one of our favourites. You can clearly see when the market is peaking by how many short term holders there are (large red spikes).

We highly recommend any on-chain enthusiast check this chart out every once in a while to get a general idea where we are in the current market cycle.

Right now it’s looking like we’re in the very early stages of the bull market. Are you ready?

Bottom line: Technical indicator says: Good chance Bitcoin go up. 🍖 

CRACKING CRYPTO 🥜

Grayscale wins court battle against SEC; Bitcoin jumps 6% within first hour after ruling

In a landmark ruling on August 29, 2023, the United States Court of Appeals for the District of Columbia Circuit vacated an order from the Securities and Exchange Commission (SEC).

X Secures Rhode Island Currency Transmitter License, Paving Way To Crypto Services

X, formerly known as Twitter, has edged closer to its goal of integrating cryptocurrencies into its services by securing a currency transmitter license in Rhode Island.

USDC Will Launch Natively On Base Network ‘Next Week’ — Jeremy Allaire

Base launched on Aug. 9 without a native version of Circle’s stablecoin, which resulted in a bridged version having to be used instead.

TRIVIA TIME ✍️

What is the maximum amount of Bitcoin that can be created

  • A) 19 million

  • B) Unlimited

  • C) 21 million

  • D) 20 million

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) 21 million 🎉

The maximum supply of 21 million bitcoins will be reached around the year 2140, after which no new bitcoins can be mined.

What did you think of today's Newsletter?

don't worry, you won't hurt our feelings... 🥲

Login or Subscribe to participate in polls.

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.

Reply

or to participate.