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- 🥜 Where is the 'Banana Zone'?
🥜 Where is the 'Banana Zone'?
PLUS: Dell bull posts Bitcoin?
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GM to all you crypto nuts. Crypto Nutshell #364 climbin’ hierarchies.. 🦞🥜
We’re the crypto newsletter that’s more thrilling than surviving an alien invasion in a post-apocalyptic world... 👽🌍
What we’ve cooked up for you today…
🏦 Here come the big dogs
🍌 Where is the banana zone?
📈 Is demand for Crypto rising?
💰 And more…
MARKET WATCH ⚖️
Prices as at 7:40am ET
Only the top 20 coins measured by market cap feature in this section
HERE COME THE BIG DOGS 🏦
BREAKING: Billionaire Tech CEO Michael Dell Signals Bitcoin Interest
Michael Dell, the CEO of Dell Technologies, just showed some major interest in Bitcoin.
It started with Dell posting “Scarcity creates value” to Twitter.
Which Michael Saylor responded with “Bitcoin is Digital Scarcity”
Dell then reposted this comment from Saylor.
Then, Dell posted a picture of the Cookie Monster gobbling Bitcoin. 😂
This Cookie Monster picture was also originally posted by Saylor.
Even though these are just Twitter comments…
Make no mistake, this is a MAJOR development.
Michael Dell has a net worth of ~$110 billion. (25x Saylor)
He’s also the 14th richest man in the world…
From a recent filing, we can see that Dell (the company) currently has $5.8 billion in cash and cash equivalents.
Could Dell be gearing up for a monster Bitcoin buy?
Or perhaps the’ve already bought?
No official statement has been made from Dell clarifying their position on Bitcoin.
But - Dell Technologies does have an annual shareholder meeting coming up June 27th…
Here’s an interesting stat for you as well:
Dell is 78.6x larger than MicroStrategy was when they first began buying Bitcoin in 2020.
It would be HUGE if Dell announced that they have adopted a Bitcoin strategy.
As always we’ll keep you updated on any major developments. 👀
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WHERE IS THE BANANA ZONE? 🍌
If you’ve been in the crypto space for any length of time, you would be familiar with the ‘Banana Zone’.
It’s a term coined by macroeconomic expert, Raoul Pal.
The ‘Banana Zone’ is the point in the crypto cycle in which global liquidity picks up, sending crypto prices parabolic.
In May, Raoul announced we were on the verge of the ‘Banana Zone’.
Yet over the last month, prices have fallen or remained largely the same.
That begs the question…
Where is this ‘Banana Zone’?
In Raoul’s latest livestream, he gave some answers.
First off, Raoul addressed everyone freaking out about recent price action:
“This space is so f*cking dumb. The moment it trades sideways: ‘It’s all over!’ I get it. Everybody’s hopes and dreams are in the ‘Banana Zone’. It’s a representation of everyone’s hopes and dreams.”
If you’re invested in crypto, when there’s periods of sideways or downwards price action, you start to second guess everything:
“I get it. I know it matters to people a lot. It matters to me a lot. When it doesn’t happen, you get that conflicting voice in your head: ‘What if it doesn’t happen?’”
However, Raoul still has full conviction that the ‘Banana Zone’ is coming. He shared 3 charts, showing why:
First off, using his GMI Overbought / Oversold indicator, we can see that the crypto rally is nowhere near overbought.
In fact, the bull-run is only just warming up:
Overbought / Oversold Indicator
Secondly, the ISM survey (a good measure of the business cycle) is closely correlated with the altcoin market.
All forward looking indicators suggest ISM will continue rising.
This suggests that the altcoin market will too:
ISM x Altcoin Market Cap
Finally, when the Federal Reserve increases liquidity (prints money) risky assets out-perform. This means crypto.
Fed Net Liquidity leads the altcoin market by ~12 months. This means we can already see what will likely happen.
Spoiler alert: It’s suggests crypto goes higher.
Fed Net Liquidity x Altcoin Market Cap
According to all three of Raoul’s indicators, the ‘Banana Zone’ is still coming.
When exactly will it begin?
No one truly knows, but it will be sometime between now & the end of the year:
“It’s [the ‘Banana Zone’] very, very likely to play out again. And I stick to that. Whether it starts next week, next month, or even September… I don’t know and I don’t care.”
All in all, fret not.
Sooner or later, we will have our bananas. 🍌 📈
IS DEMAND FOR CRYPTO RISING? 📈
Is demand for crypto actually rising?
Well, why don’t we take a look at the stablecoin supply and find out.
Stablecoins are often used on exchanges to purchase other digital assets.
This means, by taking a look at the stablecoin supply, we can see if demand for crypto is increasing or decreasing.
The chart below tracks how much the stablecoin supply has changed.
🟢 Increasing stablecoin supply: demand for crypto is increasing. Money is flowing into the space - a bullish signal 🐂
🔴 Contracting stablecoin supply: demand for crypto is decreasing. Money is flowing out of the space - a bearish signal 🧸
When we checked in on this metric two weeks ago, the stablecoin market cap was ~$150.80 billion.
Today the aggregate stablecoin market cap is ~$151.37 billion. 📈
We’re still not at all-time levels, but we’re pretty close…
Only ~$11 billion short…
The stablecoin supply has been consistently increasing since October 2023.
Let’s also take a quick look at the stablecoin supply dominance:
🟩 USDT: 74.52%
🟦 USDC: 21.57%
🟪 DAI: 3.53%
And as you can see from the chart above, USDT absolutely dominates the stablecoin market with 74.52% dominance.
(This isn’t likely to change anytime soon)
There’s a 1 simple takeaway from this data:
Every week since October 2023, money is pouring back into crypto.
In other words, demand is rising…
We’ll let you work out what that means for future prices… 😉
CRACKING CRYPTO 🥜
Binance CEO welcomes Standard Chartered move to launch Bitcoin trading desk. Banking giant Standard Chartered to launch Bitcoin and Ethereum trading desk, could challenge Binance's dominance.
RFK Jr. promises to pardon Silk Road’s Ross Ulbricht if elected. Third-party Presidential candidate Robert F. Kennedy Jr. re-iterated promises made at the libertarian convention to free Silk Road founder Ross Ulbricht.
This is why altcoin investors struggle despite Bitcoin, Ether sitting near yearly highs. Constantly diluting supply with token unlocks, selling pressure from venture funds.
Bitcoin ETFs Post $900M in Net Outflows This Week. Thursday marked the fifth straight day of net outflows for the U.S.-listed ETFs in their worst performance since mid April.
WHAT WE’RE READING 📚
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CAN YOU CRACK THIS NUT? ✍️
Select your answer below and you’ll be redirected to the results page. (answer explanation can be found after “Meme Corner”)
What type of network is the Bitcoin network? |
MEME CORNER 😂
Because what would the crypto world be without its share of memes?
Trivia Answer: D) Peer-to-Peer network 🥳
One of the core components of the Bitcoin system is the peer-to-peer network that it runs on.
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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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