The Wolf Den #502 - A Missed Opportunity
Get up to a $4,163 bonus in USDT when you sign up using my link to Bitget! Bitget is the best crypto exchange for both spot and leverage, world’s largest crypto copy trading platform, and the official partner of Juventus Football Club. They are also offering a 15% discount on trading fees!
In This Issue:
A Missed Opportunity
On-Chain Shows Dip Buying - IntoTheBlock
Bitcoin Thoughts And Analysis
Legacy Markets
The U.S. Leads In Mining
Powerful Documentary On El Salvador From Peter McCormack
Terra Community Tells Do Kwon To Go Fork Himself
My Recommended Platforms And Tools
A Missed Opportunity
Do you ever have a conversation with someone and then instantly regret all of the things that you failed to say?
That happened to me yesterday, on live national TV. I had the opportunity to spend 5 minutes (it ended up less than 3) with Stuart Varney on one of the highest rated prime time business shows on the planet.
And I have my regrets.
Here is the full interview:
'The Wolf of All Streets Podcast' host Scott Melker on growing calls for cryptocurrency regulations.
It's not that I think I did a "bad job." I had no idea what the topic would be, and gave my best, honest, off the cuff answers to his questions. I did not stumble over my words or say anything that I regret. Further, I was expecting a followup and a few more minutes to finish my thoughts.
I even dressed up. (Ok, I was also wearing sweat pants and sandals.)
I feel that I gave perfectly sufficient answers.
But when Stuart Varney presented me with the usual criticisms about Bitcoin, I failed to give the best possible answer. I had the chance to make the case for Bitcoin on the largest possible stage and left out the most important parts.
I was Kirk Gibson in Game 1 of the 1988 World Series, and instead of hitting a walk off 2 run homer in the bottom of the 9th against Dennis Eckersley (with 2 injured legs), I hit a casual double to left field. Nice hit, not a game winner.
Varney said that Bitcoin was a poor hedge against inflation, that it did not protect us from a stock market drop, that it was a poor means of exchange. He called it gambling chips.
In response, I discussed the fact that Bitcoin rose alongside inflation, making it a good hedge. Great. I discussed the power of stablecoins as a means of exchange, especially for cross border payments. Fair. I spoke about how USDT was able to handle $7B in redemptions in 48 hours, something that no bank would come close to managing. Cool.
What I have been kicking myself over since the interview is that I did not flat out tell him that he was wrong... but that it was ok to be wrong because he was viewing Bitcoin through the lens of a privileged American.
Of course a host on a national financial news show in the United States would approach Bitcoin as an investor with a well balanced portfolio, conditioned to the movements and nuances of other asset classes. Context is everything, and for him (and most of us in the US), it is just another potential asset to invest in that needs to be measured against the stock market.
I don't blame him.
All of his criticisms are understandable if you live in a country where the currency is the global reserve, and if you already have countless investments and generational wealth.
What I should have said was that people in Venezuela see Bitcoin as the ideal hedge against their hyper-inflating currency. They immediately move into Bitcoin or stablecoins when they receive money, because it is instantly losing value. Their relatives can easily get Bitcoin to them instantly from other countries. Bitcoin saves lives.
I should have explained to him that the people of El Salvador use Bitcoin every day for remittances, helping them to store value and also to avoid being robbed instantly when they leave Western Union with their dollars, which were sent at a tremendous fee to a predatory middle man.
I should have discussed how the youth in Nigeria have created an entire financial system with Bitcoin as the sole means of payment, exchanging value without ever touching fiat currency. They buy and sell things daily with Bitcoin.
I should have reminded him that the vast majority of the world's population is unbanked or underbanked and that crypto is often their only option. All a person needs is a cell phone and a willing counterparty, and crypto becomes their personal bank.
I should have told him that 44% of Americans have zero exposure to the stock market and live check to check, so worrying about Bitcoin's performance vs. your equity portfolio is a rich man's problem.
There are so many things that I should have said in that moment.
Shoulda, woulda, coulda.
Bitcoin is all of the things that people say it is not... just not necessarily for those of us who live a privileged life. Most of us don't NEED Bitcoin to be a means of exchange in the United States, and we are not starved for access to dollars or even to basic banking services. Bitcoin is good for us, of course. But it is GREAT for the people that need it most.
I failed to say all of the things that I should have.
I won't make the same mistake next time.
QUICK NOTE ABOUT THE GIVEAWAY! All winners will receive an email by Friday, asking for your USDT (ERC-20) address. They are being chosen randomly from the list of subscribers. I will also share them in the newsletter on Friday, with some of the information blocked out so that I do not doxx anyone's email address.
On-Chain Shows Dip Buying - IntoTheBlock
In this report, we bring to you the latest in on-chain cryptocurrency analysis. We look at the blockchain directly and analyze balances, transactions, and the overall activity of market participants. This gives us a unique insight into the future of the market.
This section is written in conjunction with IntoTheBlock (ITB). ITB is an intelligence company that leverages machine learning and advanced statistics to extract intelligent signals tailored to crypto-assets. IntoTheBlock tackles one of the hardest problems in crypto: to provide investors with a view of a crypto asset that goes beyond price and volume data.
The Wolf Den research team uses IntoTheBlock to dig deeper and get the most important insights about the crypto market.
On-chain data still shows a buy the dip narrative
It goes without saying that we have experienced some of the hardest days in crypto history with the collapse of Terra, which led to the most significant crash since May 2021.
As Bitcoin dropped to $26k and is currently hovering around the $30k mark, it’s worth mentioning a couple of interesting on-chain data points that we spotted during the events of last week.
IntoTheBlock Bitcoin’s ownership insights
During this recent crash, we have experienced the largest volume by far since the 2020 and 2021 crashes.
For the first time since they started trading, hedge funds are massively long CME Futures.
The addresses that IntoTheBlock labels as traders - addresses holding for less than 1 month, have increased their balance considerably since May 8th.
This is quite interesting, as these addresses usually follow the price action of Bitcoin, but this past few days, they have been “buying the dip”.
Although the number of “traders” decreased from 3.43m addresses to 3.13m addresses yesterday, the balance held by these addresses increased to the highest number since March 29th.
Although this does not necessarily mean that the bottom is in, on-chain data reflects an increasing interest not only from long-term holders, but also from retail traders that historically sold at a loss. They have been accumulating at these prices, and of course, the CME futures are bullish for the first time ever.
Bitcoin Thoughts And Analysis
DAILY CHART
There is nothing to see here, and absolutely nothing new to update you on. We had the major spike in volume and aggressive buying at "the bottom." Now we wait for the next move. 30K all day, for now.
Legacy Markets
I have been sharing pre market data from Yahoo each day, as hopefully it helps gives some insight as to what to watch this week and what is currently happening in global markets.
What to watch this week:
G-7 finance ministers and central bankers meeting Wednesday
Eurozone, UK CPI Wednesday
Philadelphia Fed President Patrick Harker speaks Wednesday
China loan prime rates Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.2% as of 9:45 a.m. London time
Futures on the S&P 500 fell 0.4%
Futures on the Nasdaq 100 fell 0.7%
Futures on the Dow Jones Industrial Average fell 0.3%
The MSCI Asia Pacific Index rose 0.8%
The MSCI Emerging Markets Index rose 0.6%
Currencies
The Bloomberg Dollar Spot Index rose 0.2%
The euro fell 0.4% to $1.0505
The Japanese yen rose 0.1% to 129.20 per dollar
The offshore yuan fell 0.3% to 6.7617 per dollar
The British pound fell 0.9% to $1.2382
Bonds
The yield on 10-year Treasuries declined three basis points to 2.95%
Germany’s 10-year yield declined one basis point to 1.04%
Britain’s 10-year yield declined six basis points to 1.82%
Commodities
Brent crude rose 1.5% to $113.66 a barrel
Spot gold was little changed
The U.S. Leads In Mining
New research from Cambridge has established a firm picture of the distribution of Bitcoin mining around the world. The U.S. leads (37.84%), followed by China at (21.11%). Kazakhstan (13.22%), Canada (6.48%), and Russia (4.66%) round out the top 5. According to the report, the U.S. has retained its leading position since China’s crackdown and has maintained a leading pace in growth.
Did you know that the state with the most mining in the U.S. is Georgia? I would have guessed Texas, but apparently Georgia accounts for 30% of the hash rate in the country. That is about three times more than Texas, which is in second place. Also notable in the study was China’s mining comeback. Immediately following the ban, the hash rate was close to zero, but now China is holding on strong for the silver medal.
We want to see these numbers distributed. It’s not about winning a race, it's about decentralizing the network as much as possible.
Robinhood To Embrace Web3
Robinhood is launching its own multi-purpose wallet application that will rival MetaMask and other major wallets. The new wallet will be designed for newcomers and will apparently cover gas fees on swaps.
“With our web3 wallet, we’re building a product that will satisfy the most advanced DeFi believers while creating a secure on-ramp for those who are just starting out in crypto to go deeper into the ecosystem.”
“We will give you access to everything, but we will show you warnings on things that are risky. But at the end of the day we are not making decisions for you.”
“We're making it not scary, easy to use.”
It will be interesting to see whether there is pushback or whether the crypto community embraces this wallet from Robinhood.
Powerful Documentary On El Salvador From Peter McCormack
Peter McCormack tweeted that he had completed a movie on Bitcion in El Salvador. I happened to be sitting at my computer and took the time to watch it in its entirety.
I found it riveting, honest and balanced.
For one, Peter has balls of steel - he asked Bukele directly if he is a dictator and addressed many of the criticisms of the young President.
More importantly, he showed both sides of the story, not just the Bitcoin-centric view that most of us expected to see.
Powerful and definitely worth watching.
Terra Community Tells Do Kwon To Go Fork Himself
The Lunatics (and everyone else everywhere) have seemingly had enough of Do Kwon after the collapse of Luna and UST. He proposed a fork, effectively starting from scratch with Luna and airdropping coins to Luna holders. The problem? This does nothing for those who lost everything on UST, primarily retail that were staking it for yield, trusting Do Kwon and his team. This would be another example of reimbursing the rich, like VCs and funds that were invested, and letting the poor suffer.
90% of respondents voted clearly against the proposal.
I think it's time for Do Kwon to step aside and take his monstrous ego and hubris with him. Luna can potentially survive with new leadership and a new mandate.
My Recommended Platforms, Tools And Podcast Sponsors
Proud sponsor of The Wolf Den Newsletter. The world's biggest crypto copy trading platform, up to a $3000 bonus for signing up.
Mining for everyone! You can buy an ASIC and have it set up at a destination of your choice by them, and you only pay the electricity cost. Absolutely awesome.
I use RoundlyX to buy small amounts of Bitcoin every single day. They automatically round up my credit card purchases (with 10x multiplier) and invest them in crypto. Absolutely brilliant. Passively invest money you don’t need without a thought.
Rewards Code: WOLF
Concierge Phone Service for Americans that protects your from SIM Swaps and other phone related hacks. I cannot stress enough how amazing this service is.
Subscribe to my YouTube channel for free daily content.
Follow me on Twitter at @scottmelker. This is where I am constantly updating my trades and sharing ideas.
On-chain and fundamental analysis, research, predictions and indicators, all in one place. Highly recommend.
The most comfortable clothing on the planet, so much so that I went out of my way to ask them to be a sponsor after pushing them endlessly on my YouTube streams! Seriously, these are my favorite clothes. Whatever you are wearing right now is less comfortable than Vuori.
I have chosen Bullish as a sponsor for both my podcast and livestreams! They are an awesome exchange that incorporates all of the benefits of both centralized and decentralized exchanges. Your keys, your coins, but with a robust order book, complex orders and deep liquidity.
Vauld are sponsoring both my podcast and livestreams and have become my personal platform of choice for holding coins and earning yield. I love their rates (12.68% on Stables and 6.7% on BTC and ETH) and their buy the dip feature that automatically buys for me when price drops.
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.
IF YOU HAVE ANY ISSUE WITH THE NEWSLETTER OR YOUR SUBSCRIPTION, PLEASE CONTACT: PREMIUMSUPPORT@GETREVUE.CO