GM to all of you nutcases. It’s Crypto Nutshell #829 lookin’ for alpha… 🔍🥜

We're the crypto newsletter that's more paranoid than a detective realising the conspiracy goes all the way to the top… 🕵️🌊

What we’ve cooked up for you today…

What’s in the Crypto Nutshell Portfolio?

BREAKING: Morgan Stanley just filed for a crypto bank charter — and it's not the only giant making moves.

Morgan Stanley just applied to custody crypto under a federal bank charter.

The $2 trillion investment bank filed with the OCC to create "Morgan Stanley Digital Trust" - a new entity built specifically to hold digital assets for clients. It would also handle purchases, sales, swaps, transfers, and staking.

This isn't just a side project…

Morgan Stanley has hired a dedicated crypto unit lead, posted multiple digital asset job listings, and filed for spot Bitcoin, Solana, and staked Ether ETFs - all since January.

And they're joining a growing line.

Circle, Ripple, BitGo, Fidelity, Paxos, Bridge, Crypto.com, and Payoneer have all filed for or received conditional OCC charter approvals in recent months. The race to build regulated crypto infrastructure on Wall Street is accelerating fast.

Meanwhile, JPMorgan is looking further ahead.

In a new report, JPMorgan analysts said the CLARITY Act - a major crypto market structure bill - could be approved by mid-year. And if it passes, they see it becoming a key catalyst for the second half of 2026.

The bill would create a clear framework to classify tokens as either commodities or securities. It would let new projects raise up to $75 million without full SEC registration.

It would open the door for institutions like BNY Mellon and State Street to directly custody digital assets. And it would set clearer rules for tokenisation of real-world assets.

JPMorgan's team put it simply: the legislation would end "regulation by enforcement" and promote greater institutional participation. They also reiterated their long-term Bitcoin price target of $266,000.

The conference circuit tells the same story.

At this week's iConnections event in Miami - one of the largest capital introduction conferences globally - more than 75 digital asset funds held roughly 750 meetings with allocators.

Nearly a quarter of limited partners on the platform now express interest in crypto strategies. Family offices are leading the charge.

iConnections CEO Ron Biscardi said the tone has shifted completely.

In 2022, some investors still called crypto a Ponzi scheme. "I don't hear any of that anymore," he said.

Bitcoin is still down big from the highs. Crypto stocks are beaten up. Sentiment is weak.

But behind the scenes, the biggest names in finance are building - not leaving. 🚀

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Every week there's a new reason as to why crypto has been so lousy.

First it was Binance. Then Wintermute. Then some unknown offshore macro hedge fund. Then paper Bitcoin. Last week it was Jane Street. Next week it'll be someone else.

Matt Hougan is tired of it. And he just said what needed to be said.

Hougan is the Chief Investment Officer at Bitwise, one of the largest crypto asset managers in the world. He's been institutional crypto's calm voice throughout this entire downturn. And this week, he called out the conspiracy theories for what they are: noise.

The real reason Bitcoin is down? It's boring.

Here’s the truth about this crypto winter: A bunch of people who were long Bitcoin sold their Bitcoin exposure. They sold spot. They unwound leveraged positions. They wrote calls against their holdings. That's it.

Why did they sell? The 4-year cycle narrative. Quantum computing fears. Rotating capital into A.I startups. And a dozen other reasons that have nothing to do with some shadowy cabal manipulating the market.

And here's the part that matters most:

Hougan says the selling is mostly done. We are in the process of bottoming. And new all-time highs are coming.

This is a classic crypto winter. Not a conspiracy. Not a coordinated attack. Just a normal, painful, cyclical drawdown that has happened every single time before.

And every single time before, it was followed by a classic crypto spring.

People want someone to blame. Hougan gets it. But the reality is far more boring than that.

And far more bullish. 🌱

Let’s kick off the week with a look at the Bitcoin HODL Waves - one of the clearest snapshots of market conviction.

Each coloured band represents the percentage of Bitcoin that last moved within a specific time frame.

The warmer the colour, the younger the coins - with red showing Bitcoin that has been held for less than one day.

Today, we’re focusing on short-term holders (STHs) - defined as coins held for less than six months.

Here’s how the Bitcoin supply breakdown looks today:

TL;DR: 29.94% of all Bitcoin is in the hands of short-term holders.

That's down from 30.85% two weeks ago. Short-term supply is shrinking.

But the movement within the bands is telling.

The youngest cohort (<1 day) dropped as fresh buying slowed. The 1 day to 1 week band ticked down too. And the 1 week to 1 month group shed nearly a full percent.

Where did all that supply go?

The 1-3 month band contracted sharply - down 3.76% - while the 3-6 month cohort surged by 4.26%.

Translation: a lot of coins are aging, not selling.

Supply is migrating up the ladder from the most impatient hands into longer holding periods. If these coins survive the chop and cross into the 6+ month bands, they become long-term holders.

Magic Eden Pulls Plug on Bitcoin and Ethereum Support, Doubles Down on Solana. Magic Eden is pulling support for Ethereum-compatible and Bitcoin-based assets, marking an end to its multi-chain approach to user adoption.

Buying Bitcoin? Hold BTC for at Least Three Years to Avoid Losses. Traders who bought Bitcoin 3–5 years ago are still up 90% on average, even after the latest correction.

Vitalik Buterin lays out a two-part plan to overhaul Ethereum's execution layer from the ground up. The binary tree proposal is a concrete, in-progress effort, while the VM transition remains more speculative and lacks broad consensus among developers.

Iran is using a $7.8 billion crypto shadow economy to bypass global sanctions. The government relies on this crypto infrastructure for international trade, while ordinary Iranians use it as a financial lifeline during protests and economic crises.

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

Trivia Answer: Ethereum 🥳

Launched in 2015 by Vitalik Buterin, Ethereum was the first blockchain designed to support programmable smart contracts, enabling decentralised applications beyond simple value transfer.

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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.