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What’s in the Crypto Nutshell Portfolio?

BREAKING: US Bitcoin ETFs shed $485M in biggest daily outflow since June

The money that's supposed to buy Bitcoin's dips sold this one instead.

Investors pulled $485 million out of US spot Bitcoin ETFs on Wednesday, the biggest one-day exit since June, led by $208 million from BlackRock's IBIT.

That one day wiped out October's inflows, and another $244 million left on Thursday, putting the funds about $407 million down for the month.

Bitcoin kept sliding on Thursday and dipped under $81,000, its lowest in almost three weeks and about 7% below the $87,000 it reached on Monday.

That's the first real test for the idea that the ETFs buy weakness by design, and the sellers won it.

The theory runs that funds holding a fixed slice of Bitcoin have to buy more whenever the price falls, to keep the slice the same size.

Decrypt pins the selling on bonds and oil rather than anything inside crypto, with the 30-year Treasury yield up around 5.7%, its highest since 2002, and Brent crude near $100 a barrel after tanker attacks around Hormuz.

When a government bond pays 5.7% for doing nothing, it gets harder to justify holding an asset that pays no interest at all.

Leverage made it worse, with about $1.2 billion of positions liquidated across crypto in 24 hours, more than $1 billion of it bets on a rise.

Oil fell after Trump said the US won't attack Iran before the November midterms, and Bitcoin has since climbed back to about $82,000.

The flow data shows which funds shrank but can't say who sold, and a share dumped by a hedge fund looks exactly like one sold by an adviser trimming a client's portfolio.

JPMorgan reckons the bigger picture is healthier, estimating about $50 billion has flowed into crypto this year, with ETF flows and futures positioning both climbing in the third quarter.

Saturday marks a year since the October 10 crash, when Bitcoin fell from about $122,000 to $105,000, much of it in a few minutes.

Measured from that night, JPMorgan counts more cash leaving crypto ETFs than arriving, so the funds expected to catch the dips have been net sellers ever since… 🚀

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Larry Lepard got asked to prove his call that more money printing is coming, so he answered with a chart.

Lepard is a veteran investor and author of "The Big Print", one of the most articulate voices on monetary debasement.

Here's what he posted:

His argument starts with base money (the dollars the Fed creates itself, the foundation every bank loan gets stacked on).

Debt needs that base underneath it to keep getting serviced and rolled over, and when debt outgrows it by too much, something gives…

On his chart, US debt across every sector sits around $120 trillion, against a Fed balance sheet of roughly $6.7 trillion.

Lepard marks the two times the gap snapped, 2008 and 2020, when the Fed's balance sheet jumped by more than $1 trillion and then about $3 trillion, each time within months.

Since its 2022 peak near $9 trillion, the Fed has let that balance sheet shrink by more than $2 trillion while total debt kept climbing.

That's the same divergence he flags before each of the last two prints, and in a follow-up reply he wrote, "I have seen this movie twice before."

To be fair, he isn't calling a date, and the Fed raised rates only last month, so nothing's printing yet.

But if the only way out of a debt pile that size is new money, every one of those new dollars ends up chasing the same fixed 21 million Bitcoin.

A rough week for the price doesn't touch the arithmetic, since debt keeps compounding and Bitcoin's supply doesn't budge. 🖨️

Today we'll be taking a look at the amount of Bitcoin available for sale on exchanges.

Here's how to interpret this metric:

2.684 million BTC on exchanges. Down from 2.727 million two weeks ago.

Last time the coins came back onto exchanges while the price was falling, and this fortnight they left again in bigger numbers.

Roughly 43,000 Bitcoin moved off exchanges, almost double the 23,000 that arrived the print before.

Coins leaving exchanges usually head into cold storage rather than a sell order, so this is the bullish direction for the metric.

At current prices that's about $3.5 billion of Bitcoin taken off the shelf.

The balance now sits below where it was a month ago, 2.704 million, so the refill has been fully undone.

The coins that came back two weeks ago didn't stay long. 📥

Over 6 million bitcoin sit behind exposed public keys as AI warnings mount. Glassnode puts that at about 31.2% of circulating supply, up 222,000 BTC since May, though no practical attack on wallet keys has been shown.

Securitize Brings Nvidia, Apple and Amazon Onchain With Tokenized Stocks on Solana. The first 12 tokens are each backed one-to-one by a real share, keep dividend rights and settle in USDC.

Samsung Wallet to add USDC transfers for US Galaxy users in October. The feature reaches 82 million US devices in the last week of October, with free transfers to outside crypto wallets.

NFL tells Supreme Court prediction market sports contracts are gambling, not swaps. The league says nearly $2 billion of the $3.3 billion traded on prediction markets on the season's first Sunday was tied to NFL games.

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

Trivia Answer: Unspent outputs from past transactions sent to your addresses 🥳

Bitcoin tracks coins as unspent transaction outputs (UTXOs), chunks of BTC from past transactions locked to your keys. Your wallet adds them up, and when you spend, it uses whole outputs and sends the change back to you.

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