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In This Issue:
Don’t Lose Sight
Bitcoin Thoughts And Analysis
Legacy Markets
Trump May Announce Bitcoin As A Strategic Reserve
Elizabeth Warren’s Days Are Limited
Grayscale Mini Updates Its Fee Structure
PolyMarket Is A Mind Of Its Own
Jamie Dimon’s SHOCKING U-Turn on Bitcoin: What It Means for Crypto's Future!
Don’t Lose Sight
On Tuesday of this week, I penned a newsletter titled, “Bitcoin Doesn't Need Heroes.” My thought process was simple: the more we rest on the laurels of figures like Trump, the more we unravel the safety net we've spent years weaving together.
This newsletter wasn't a criticism of Trump; how could it be when he is the first presidential candidate willing to take this space seriously? That would be ungrateful and shortsighted. It was, however, my concern for the idea that a politician or anyone could be heralded as a savior in this space.
I was fairly satisfied with that newsletter, considering how much has already been said about politics permeating into our space. But then Vitalik Buterin dropped a blog, adding much more to the conversation.
Today, I am going to expand on that original idea and present Vitalik's commentary. This is neither an endorsement nor a critique, but rather an amplification and analysis of his perspective. Without further ado, let’s dive in.
My concern about the political crossover into crypto was that we might attribute too much significance to individual figures. Vitalik's concern, however, is that we are placing excessive political emphasis solely on the issue of crypto. For instance, “There is a rising trend in the crypto space towards increased political activism, with preferences for political parties and candidates largely based on their stance towards ‘crypto.’”
Is it odd that Vitalik, the creator of Ethereum, the #2 crypto, is advocating against choosing our allegiances solely based on who is pro-crypto? Not really.
“What originally created crypto was the cypherpunk movement, a much broader techno-libertarian ethos which argued for free and open technology as a way of protecting and enhancing individual freedoms generally.”
“The point of all this is to contextualize the mentality that created blockchains and cryptocurrency in the first place: freedom is important, decentralized networks are good at protecting freedom, and money is an important sphere where such networks can be applied - but it's one important sphere among several.”
History is important to understand Vitalik’s argument.
From Wikipedia, “A cypherpunk is any individual advocating widespread use of strong cryptography and privacy-enhancing technologies as a route to social and political change. Originally communicating through the Cypherpunks electronic mailing list, informal groups aimed to achieve privacy and security through proactive use of cryptography. Cypherpunks have been engaged in an active movement since at least the late 1980s and early 1990s.”
The following quote is from the first mainstream discussion of cypherpunks dating back to 1993 in the American magazine Wired, written by Steven Levy, titled “Crypto Rebels.”
“The outcome of this struggle may determine the amount of freedom our society will grant us in the 21st century. To the Cypherpunks, freedom is an issue worth some risk.”
The core issues of this movement include privacy, decentralization, individual empowerment, freedom of expression, and security—concerns Vitalik is deeply engaged with within the Ethereum ecosystem.
Below are the technological freedoms Vitalik lists in his blog that he argues are, “just as ‘foundational’ as the freedom to do things with crypto tokens:”
Freedom and privacy of communication: this covers encrypted messaging, as well as pseudonymity.
Freedom and privacy-friendly digital identity
Freedom and privacy of thought
High-quality access to information
The above list is just referencing issues in technology, but the mission of freedom, Vitalik’s mission, goes beyond that. Here’s where things become controversial.
“My underlying point is: if you're the type of person who's willing to read this article past the first paragraph, you're not in crypto just because it's crypto, you're in crypto because of deeper underlying goals. Don't stand with crypto-as-in-cryptocurrency, stand with those underlying goals, and the whole set of policy implications that they imply.”
This may be true for some of you, while others might feel differently—I’m not here to judge, as these are complex issues. I’ll provide one more example from Vitalik’s article before pivoting to my own thoughts.
“While recently attending EthCC, I received messages from multiple friends who told me that they were not able to come because it has become much more difficult for them to get a Schengen visa. Visa accessibility is a key concern when deciding locations for events like Devcon; the USA also scores poorly on this metric. The crypto industry is uniquely international, and so immigration law is crypto law. Which politicians, and which countries, recognize this?”
I assume many of you are already aware, but Vitalik was born in Russia, which naturally provides him with a unique perspective on freedom. He and his family emigrated to Canada when Vitalik was six, “seeking better employment opportunities,” according to most sources, though I imagine there were additional reasons as well.
In the U.S., hailed as 'the land of the free,' it’s easy to overlook the freedoms we are restricted from enjoying, simply because the concept of freedom is constantly presented to us everywhere we look. For clarification, I am not dunking on the U.S.; I am aware of how extremely privileged I am to live here.
What Vitalik is warning us about is that the fight for freedom doesn’t end at Bitcoin or Ethereum. While his perspective might seem idealistic, I've always maintained that Bitcoin doesn’t solve all problems, despite what some Bitcoiners enjoy pedaling. Perhaps someday Bitcoin could become a world reserve currency and enable initiatives where individuals have a fair say in how global resources are allocated, but we are VERY far from that reality today.
Bitcoin does not address the border crisis; it does not facilitate the entry of qualified, well-intentioned individuals into the country, nor does it prevent those with harmful intentions from gaining access.
Bitcoin doesn’t solve the issue of access to information; it doesn’t make scientific research behind paywalls more accessible, nor does it address the broader challenges of information inequality.
Bitcoin doesn’t solve the issue of identity; it doesn’t make it easier to verify and manage personal identities securely, nor does it address the broader challenges of identity fraud and privacy protection.
You get the idea.
Bitcoin is solving a very important set of problems, as is Ethereum, but we have to be wary of any individual or entity who only considers freedom through a narrow lens.
That said, it would be foolish not to support a leader advocating for advancements in this space if there is one who’s value align with your others, but that doesn't mean the game is over—far from it. Furthermore, freedom will never be presented to us in a perfect, all-encompassing package to vote on. Instead, improvements will come gradually, in small, incremental steps. If a politician is giving us freedom in the form of money, we take it. If we want to make strides in other areas, we have to be just as loud as we are here.
Bitcoin catches on because there is a financial incentive, it’s that simple.
Additionally, Bitcoin reaching $100,000 or Ethereum hitting $10,000 doesn’t inherently advance our liberties. While these milestones might create the illusion of progress, the price itself is not the key factor.
Don’t lose sight of the forest for the trees, promote no one to savior status, and consider freedom from all possible angles. If the journey of a thousand miles begins with a single step, we should be grateful because we are on the brink of a massive leap.
Next week is going to be historic. Political conversations and ideas have evolved from merely circling in our minds to becoming deeply embedded in our discussions. Plus, both Bitcoin and Ethereum are entering the mainstream in unique and exciting ways.
I hope you aren’t sidelined and look forward to keeping up with all the news that is coming next week—it’s going to be A LOT.
Bitcoin Thoughts And Analysis
There is very little to see on the chart for the moment that I have not shared over the past few days.
After printing bearish divergence with overbought RSI on the 4-hour chart, we saw hidden bullish divergence and an RSI reset down to around 50, the bull/bear line.
Now we can take a look at both RSI and price, which are consolidating. Both have clear descending resistance that we will look to for a break - a signal of continuation up. Breakouts on RSI often precede the same breakout in price. So worth watching.
Legacy Markets
Global equities extended their declines as a pullback in megacap technology stocks worsened amid widespread technical outages that disrupted services across multiple sectors. The outages, notably affecting Microsoft Corp.'s online services, have added to the tech sector's woes.
Europe’s Stoxx 600 index lost 0.5%, marking its fifth consecutive day of losses and on track for its longest losing streak since October. LSE Group Plc, which operates the London Stock Exchange, fell 1% after reporting global technical issues that prevented news from being published, causing delays in opening trades across several bourses.
In US premarket trading, Microsoft shares dropped 2.8%, despite the company announcing it had resolved the cloud-services outage that had earlier disrupted flights and banking operations. Cybersecurity firm Crowdstrike Inc. slid as much as 14% after revealing it had been affected by the outage. Major airlines, including United Airlines Holdings and Delta Air Lines Inc., also saw their shares decline by more than 1%.
Contracts on the S&P 500 retreated about 0.2%, while those on the Nasdaq 100 slid 0.4%. These declines come at the end of a challenging week for the tech-heavy Nasdaq, which has shed 3.7%—its worst performance since April—as investors moved away from high-flying megacap tech names and rotated into smaller companies. Conversely, the Russell 2000 index has risen 2.3% this week.
The market moves were influenced by signs that the Federal Reserve might cut interest rates in September. This view was reinforced by data showing the largest increase in jobless claims since early May and the growing likelihood of more protectionism under a potential Donald Trump presidency. “From a big-picture perspective, both the Fed moving towards a rate cut and Trump odds increasing should be risk positive,” said Mohit Kumar, a strategist at Jefferies International Ltd. “But it also meant that investors reconsider their asset and sector allocation as we head into the summer months. Sectors with heavier positioning suffered in the adjustment.”
Goldman Sachs Group Inc. strategist Christian Mueller-Glissmann also sees a risk of a summer stock-market setback, citing the combination of weaker growth data, already dovish central bank expectations, and rising policy uncertainty ahead of the US elections.
In corporate earnings, Sartorius AG plunged 13% after the German electronics maker lowered its full-year guidance. Computer-games maker Ubisoft Entertainment SA slid more than 8% after releasing mixed full-year targets, while gaming firm Evolution AB also tumbled following earnings that missed estimates. In contrast, Netflix Inc. rose in extended trading after the streaming-video giant reported strong subscriber additions.
Earlier in the day, MSCI’s Asia Pacific Index declined more than 1%, marking its biggest weekly drop in three months. The rout in chip stocks continued amid concerns over new US restrictions on sales to China, with shares of Taiwan Semiconductor Manufacturing Co. falling for a third day.
Overall, the combination of technical outages, economic data, and geopolitical concerns has created a volatile environment for global markets, with significant impacts on both major and smaller stocks. As we move forward, these factors will continue to shape market dynamics, particularly as political and economic uncertainties evolve.
Key events this week:
Fed’s John Williams, Raphael Bostic speak, Friday
Canada retail sales
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.6% as of 9:08 a.m. London time
S&P 500 futures fell 0.2%
Nasdaq 100 futures fell 0.4%
Futures on the Dow Jones Industrial Average fell 0.3%
The MSCI Asia Pacific Index fell 1.3%
The MSCI Emerging Markets Index fell 1.5%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro fell 0.1% to $1.0882
The Japanese yen was little changed at 157.38 per dollar
The offshore yuan was little changed at 7.2806 per dollar
The British pound fell 0.1% to $1.2927
Cryptocurrencies
Bitcoin fell 0.3% to $63,632.26
Ether fell 0.9% to $3,382.05
Bonds
The yield on 10-year Treasuries was little changed at 4.20%
Germany’s 10-year yield was little changed at 2.43%
Britain’s 10-year yield advanced two basis points to 4.08%
Commodities
Brent crude fell 0.3% to $84.88 a barrel
Spot gold fell 1% to $2,420.48 an ounce
Trump May Announce Bitcoin As A Strategic Reserve
At this point, this is only a rumor and will likely remain so until any official announcement is made. Pun intended, this would Trump BlackRock announcing they are filing for a Bitcoin ETF and El Salvador adopting a Bitcoin standard. If the U.S. does buy Bitcoin, expect the floodgates for other countries to fly wide open. This would be the most important narrative ever created and would add time on the back end of the bull market.
Might I add, if Trump is considering appointing Jamie Dimon as Treasury Secretary and has ‘orange-pilled’ him, then such an announcement is not out of the question. I’m not putting odds on it, but I am not counting it out or dismissing the possibility of follow-through.
I have my doubts.
Elizabeth Warren’s Days Are Limited
Tyler and Cameron Winklevoss have combined donated a total of $1 million in Bitcoin to the campaign of John Deaton, who is attempting to unseat Senator Elizabeth Warren in Massachusetts.
“Elizabeth Warren is one of the single greatest threats to American prosperity. When it comes to crypto, she is public enemy number one. She’s the chief architect and driver of the Biden Administration’s war on crypto. She wages this unlawful war by weaponizing government agencies to attack our industry through a combination of debanking, bad faith enforcement actions, and other abuses of power.”
John Deaton isn’t just a potential replacement for Senator Warren; he is pro-Bitcoin, pro-crypto, and pro-business—stances that directly oppose Warren’s positions. Additionally, the Deaton campaign is supported by Ripple Labs, which has donated $1 million to a new super PAC aimed at boosting his campaign. It’s pretty impressive that both Bitcoiners and the Ripple army want John Deaton elected. Myself as well.
Grayscale Mini Updates Its Fee Structure
I’m not sure if it was the backlash that prompted Grayscale to change its fee structure, but the Grayscale Ethereum Mini Trust is now, “waiving the fee to 0% for the first six months, applicable up to a maximum of $2 billion in assets under management (AUM),” and will then set the fee at 0.15%, the lowest in the market. While this adjustment may help mitigate some outflow by bringing assets back into a Grayscale product, the damage has already been done due to Grayscale’s initial 2.5% fee for ETHE.
They are smoking crack.
PolyMarket Is A Mind Of Its Own
A staggering $135 million has been bet on the Democratic nominee for the upcoming election. Even more fascinating is that Kamala Harris is leading Joe Biden 2:1 in the odds. Curious about Joe Biden’s odds of dropping out? At the time of writing, they are at 89%! WOW.
Jamie Dimon’s SHOCKING U-Turn on Bitcoin: What It Means for Crypto's Future!
Jamie Dimon, the CEO of JPMorgan and a long-time Bitcoin critic has supposedly changed his stance on crypto. What does it mean for Bitcoin? I will discuss this and more with Dan Gunsberg, the Founder of Hxro Network. In the second part of the show, Dan from The Chart Guys will share his market analysis and some trades.
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.