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GM to all you crypto nuts. Crypto Nutshell #396 heatin’ up... 🔥🥜
We’re the crypto newsletter that's more hilarious than a talking teddy bear's misadventures... 🧸🤣
What we’ve cooked up for you today…
🚀 Here they come
🌊 We’re still early
🤔 Who’s HODLing?
💰 And more…
MARKET WATCH ⚖️
Prices as at 3:50am ET
Only the top 20 coins measured by market cap feature in this section
HERE THEY COME 🚀
BREAKING: Jersey City to invest in Bitcoin ETFs, the latest pension to dive into crypto
Here’s something we weren’t expecting.
Steven Fulop, mayor of Jersey City, announced that he plans to allocate part of the city’s pension fund to the Bitcoin ETFs. 👀
In a July 25 Twitter post, Mayor Fulop explained his reasoning for this decision:
“The question on whether Crypto/Bitcoin is here to stay is largely over + crypto/Bitcoin won. Jersey City pension fund is in process of updating paperwork to the SEC to allocate % of the fund to Bitcoin ETFs.”
Continuing on, Fulop mentions:
“I’ve been a long time believer (through ups/downs) in crypto but Broadly, beyond crypto I do believe blockchain is amongst the most important new technology innovations since the internet.”
Although Mayor Fulop did not explicitly state the exact percentage the fund would invest into Bitcoin, he did say it would be “similar to the Wisconsin Pension Fund (2%)”.
Now if you can remember all the way back to early May of this year, you would recall the big news surrounding the Wisconsin pension fund.
They were the first US pension fund to officially invest into the Bitcoin ETFs.
At the time, their investment totalled $164 million out of the funds $156 billion in assets.
Although this may not sound like much at first glance, make no mistake…
This is HUGE news.
And is only the beginning of institutional adoption.
BlackRock’s head of digital assets explains why we’re still early in the next section.
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WE’RE STILL EARLY 🌊
Despite the launch of the Ethereum ETFs this week…
We’re unlikely to see other crypto ETFs like Solana anytime soon. (at least from the likes of BlackRock)
That’s the latest out from Robert Mitchnick.
For those of you who don’t know Robert, he’s the Head of Digital Assets at BlackRock.
He’s also known on the streets as the man that orange-pilled Larry Fink. 👏
Speaking at Bitcoin 2024, Robert gave some insights into the Bitcoin ETFs.
And according to him, we’re still early…
BlackRock’s Bitcoin ETF has three main client segments:
Direct investors - small dollar retail to ultra high net worth investing on their own accord
Wealth advisory
Institutional
Out of those three, direct investors came storming out of the gates on launch day.
But we’re still waiting on the wealth advisory and institutional sectors to come online. (some have but it’s only a small percentage)
It takes a LONG time for these platforms to finish their due diligence.
Robert was asked when can expect these platforms to start offering the Bitcoin ETFs.
This is what he had to say:
“I won’t get into specific names and timelines obviously, but certainly this year is likely.”
Sounds like another wave of demand is coming. 🌊
Robert was then asked what are BlackRock’s clients currently interested in.
“Our client base today, their interest overwhelmingly is in Bitcoin first. And then somewhat in Ethereum, there’s definitely interest in ETH too. And there’s very little interest today beyond those two.”
Solana maxis, time to look away…
Robert expanded on the point he made above, stating that Bitcoin and Ethereum are the 2 dominant crypto assets.
Beyond that point, there really is nothing of considerable size.
“I don’t think we’re going to see a long list of crypto ETFs. If you look at Bitcoin today, it’s 55% of the market. Ethereum is at 18%. The next plausible investable asset is at like 3%. There’s just nothing close to being at that threshold of track record, maturity, liquidity etc that BTC and ETH have.”
It doesn’t sound like BlackRock is interested in launching a Solana ETF anytime soon.
Robert also explained how he differentiates BTC and ETH to clients:
“We don’t view BTC and ETH as competitors. Bitcoin is trying to be a global monetary alternative, as a potential global payment system. Ethereum isn’t really trying to be that. ETH is trying to do a bunch of different applications. So really they’re more compliments than they are competitors.”
It’s a ‘rising tide lifts all boats’ kind of situation.
At their core, Bitcoin and Ethereum aren’t competing with each other.
They serve completely different use cases.
The launch of the Ethereum ETFs has been a huge benefit to the crypto industry as a whole.
WHO’S HODLING? 🤔
Time for a check in on one of our favourite charts.
The supply last active 1+ years ago metric is super simple to understand and extremely useful.
It categorises coins based on how long it’s been since they last moved on-chain. (as a percentage of the circulating supply)
Metrics rising: long-term holders are accumulating coins 📈
Metrics declining: long-term holders are selling coins 📉
Taking a look at the chart below you’ll notice significant dips in these metrics when Bitcoin reaches new all-time highs. (especially from the 1+ year age band)
Here’s the breakdown for each cohort (compared to what it was 4 weeks ago):
🔴 Supply last active 1+ years ago: 65.21% (down from 65.31%)
🟠 Supply last active 2+ years ago: 54.05% (down from 54.19%)
🟢 Supply last active 3+ years ago: 45.84% (down from 45.99%)
🔵 Supply last active 5+ years ago: 30.78% (up from 30.63%)
Over the last four weeks the 1+, 2+ and 3+ ages bands experienced slight decreases. (we’re talking real small decreases of ~0.15%)
But the 5+ age band saw a minor increase of 0.15%
Is this anything to worry about?
The short answer is no.
During bull markets we expect some form of selling from long-term holders.
At the end of the day, it’s only natural for investors to take profits eventually…
And so far, this bull run hasn’t been any different. (in terms of long-term holders taking profits)
However, looking at the chart above, this selling from long-term holders has began slowing down considerably.
We only have to worry about this metric if we start seeing continuous selling from LTH’s - that signals a market top is forming.
All in all, long-term holders still have an extremely high conviction in Bitcoin.
Just take a look at the 5+ year age band.
It’s basically only ever trended upwards.
CRACKING CRYPTO 🥜
Bitcoin and Ethereum plunge after US tech sell-off, sparking $300 million in losses. Ethereum and Bitcoin lead crypto market into freefall following US shares record decline.
Direct client demand driving growth in BlackRock's Bitcoin ETF so far. BlackRock's Bitcoin ETF is gaining traction due to strong client demand and institutional interest is growing as adoption accelerates.
Staking in Ethereum ETFs Might Be a Question of When, Not If. The ETH ETFs had a largely successful launch on Tuesday, despite the missing staking feature that many investors had hoped to profit from.
There won’t be a ‘long list of crypto ETFs,’ BlackRock’s Robert Mitchnick says. Despite the launch of spot ETH funds, BlackRock’s head of digital assets is skeptical the SEC will approve other crypto funds.
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”)
In crypto, what does the term NFT stand for?
MEME CORNER 😂
Because what would the crypto world be without its share of memes?
Trivia Answer: C) Non-Fungible Token 🥳
NFT stands for 'non-fungible token'. Non-fungible means that something is unique and can't be replaced.
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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.