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In This Issue:
We Dreamt Of A "Superchain"
The Bitcoin 4-Year Cycle Remains Intact
Is PEPE Dead? The Team Is Selling
Markets Hold Breath For Powell
Arthur Hayes On Bitcoin
Over 54 Major Crypto SIM Swaps In 2023
Pantera Predicts $148,000 For Bitcoin
Nvidia Skyrockets | Bitcoin Bounces, But Bear Risks Are Still High | Next Crypto Boom Not To Miss!
We Dreamt Of A "Superchain"
In the depths of a Coinbase blog, I happened upon a brief quote that deeply struck a chord with me.
We dreamt of a "Superchain" future…
The quote carried on further than just these six words, but before I share the rest, I am going to briefly backpedal to set the stage. I promise there will be a point to my rambling.
The blog I'm referring to as the "Coinbase blog" is actually by Base, Coinbase's Layer 2, which went live to the public a little over two weeks ago. For those who haven't been following the news closely, Base has entered the scene with vigor since its debut. Its two most notable developments, $BALD and Friend.tech, have been flops. But setting jokes aside, the technology and vision still hold significant promise, and that's why I've directed my attention to this blog.
The blog began with a TLDR, I’ll share it here so we are on the same page.
TL;DR: Base is an open, permissionless Ethereum L2 incubated at Coinbase with a commitment to decentralization. Base was built on the open source OP Stack in collaboration with the Optimism Collective, and together, we are working toward improved decentralization using the Law of Chains as our guide. This commitment includes routing a portion of Base sequencer revenue to the Optimism Collective and actively participating in governance.
The opening sentence features a familiar catchphrase we all recognize: "We launched Base with a grand vision—bringing the next million developers and a billion users onto the blockchain."
All of what Base is saying, I have internalized many times before, but my thought process completely changed when I read the following:
We dreamt of a "Superchain" future: a web of rollups and L2s, all working together to jointly scale Ethereum. Chains that are part of the Superchain will allow builders and users to transact and move across chains easily and affordably, creating a consistent user experience and laying the groundwork for teams everywhere to build a decentralized future.
We have known all along that both Coinbase and Base are committed to Ethereum, but reading about the “Dream of a Superchain” really hammered the point home for me. There isn't another layer 1 close to receiving the attention, focus, and commitment from the top players that Ethereum is receiving.
It’s not even close.
The topic of yesterday’s Crypto Town Hall was the same - can anything be an ETH killer? Ben Zhou, the CEO of Bybit dismissed this notion outright. He went as far as to say that the other chains are not even needed.
Strong words.
Coinbase is undeniably one of the most powerful companies in crypto and their dream is to build a decentralized future on Ethereum. How could I not be bullish? The blog continues to discuss the technical promises needed to make the superchain dream a reality, but I will spare you the technical parts and quote the juicy stuff below. If you do wish to read the blog, which I recommend, you can do so HERE.
These initiatives will not only strengthen Base, but the foundation on which the Superchain and the global, open, onchain economy can be built.
We believe Base must be an open, neutral ecosystem to enable a global onchain economy that unlocks economic freedom around the world. And we’re not alone: as the number of chains in the Superchain grows, it becomes crucial to establish a shared set of standards for these protocols.
We are excited for others to join the Superchain vision to help bring the next million builders and billion users onchain.
Even during times of sluggish news, there's usually a silver lining that reignites conviction and excitement if you are willing to look hard enough. I hope that's the sentiment you gleaned from both yesterday's and today's newsletters. Wishing you a fantastic weekend ahead. Wolf out.
The Bitcoin 4-Year Cycle Remains Intact
When in doubt, zoom out. I have shared this chart countless times and want to remind you that you could have fallen asleep for the past few years, missed all of the macro, Evergrande, the Fed etc., woken up, looked at this chart and said “yes, we are in the right place.” There may be more chop, another shakeout coming, but this is exactly where Bitcoin should be in the halving cycle. This is not the time to get cute, but rather the time to brace for turbulence and hold on for about a year until the next true bull trend likely strikes.
Is PEPE Dead? The Team Is Selling
In case you missed it, the story of what is happening with PEPE is detailed above, courtesy of Miles Deutcher from Crypto Banter. I align with his thoughts, so there is no point adding much more. I would not be surprised to see a valueless meme coin rug pull, obviously, although I cannot say that is what is happening.
Here is the chart.
I would not touch this, personally, but people who are gamblers probably like this zone as support.
I never cheer for anyone to lose money, but I would love to see an end to the meme coin craze, which I believe is damaging to our space,
Markets Hold Breath For Powell
Stocks remained mostly stagnant on Friday, with European indices showing a positive trend for the week while investors await a speech from Federal Reserve Chair Jerome Powell at Jackson Hole. Europe's Stoxx 600 was up, supported by gains in commodity shares like oil and iron ore. Asian stocks fell, in line with Wall Street's previous losses.
The market has been erratic this week, with significant gains followed by sharp declines as attention shifted from corporate earnings to interest rate trends. Treasury yields inched up, especially those sensitive to immediate policy changes.
The speech by Powell, due at 10:05 a.m. Washington time, may offer insights into the Federal Reserve's thoughts on rate hikes and when to cut them. This has prompted caution among investors, who are watching for signs of hawkishness that could trigger broader market declines.
In other news, China eased mortgage policies to bolster its economy, but the positive effect on stocks was brief. Commodities like iron ore are set for significant weekly gains, and oil prices have trimmed their weekly loss.
Key events this week:
US University of Michigan consumer sentiment, Friday
Fed Chair Jerome Powell, ECB President Christine Lagarde to address Jackson Hole conference, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.3% as of 9:59 a.m. London time
S&P 500 futures rose 0.2%
Nasdaq 100 futures rose 0.1%
Futures on the Dow Jones Industrial Average rose 0.2%
The MSCI Asia Pacific Index fell 1.2%
The MSCI Emerging Markets Index fell 1%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro fell 0.2% to $1.0786
The Japanese yen fell 0.1% to 146.02 per dollar
The offshore yuan fell 0.1% to 7.2913 per dollar
The British pound fell 0.1% to $1.2586
Cryptocurrencies
Bitcoin rose 0.3% to $26,082.51
Ether rose 0.3% to $1,654.06
Bonds
The yield on 10-year Treasuries was little changed at 4.25%
Germany’s 10-year yield advanced three basis points to 2.54%
Britain’s 10-year yield advanced two basis points to 4.45%
Commodities
Brent crude rose 1.2% to $84.35 a barrel
Spot gold was little changed
Arthur Hayes on Bitcoin
It's been around a month since our last update from Arthur Hayes, and once again, we are treated to another epic piece of content. In his latest piece titled "Kite or Board," Hayes kicks off by recounting his recent kitesurfing challenges in the Canary Islands. Hayes then skillfully ties this adventure into a broader discussion about the Federal Reserve's battle against inflation. Hayes truly possesses a unique talent for blending seemingly unrelated topics seamlessly. Personally, I've always found his blogs worth sharing here, and this time is no exception. To give you a glimpse, here are some of the best highlights - yes, these are definitely spoilers!
One of Bitcoin’s value propositions is that it is the antidote for a broken, corrupt and parasitic fiat banking system. Therefore, as the banking system falters, Bitcoin’s value proposition grows stronger. Also, Bitcoin benefits from increased fiat liquidity. Rich people don’t need real stuff; they need financial assets so they can effortlessly consume to their hearts desire. Bitcoin has a finite supply, and therefore as the denominator of fiat toilet paper grows, so will Bitcoin’s value in fiat currency terms. This is why Bitcoin is up 18% since March.
As long as the Fed is committed to its current path, tech stocks and crypto will continue rising. Apart from big tech and crypto, nothing else returns more than just parking your money with the Fed earning close to 6%.
The ongoing crypto crackdown in the US and West in general is focused on making it hard to do business for operators who don’t power lunch at The Racquet & Tennis Club on Park Ave in New York. Ponder this: how is it that the Winklevii – two tall, handsome,Harvard-educated, cis-gendered, tech billionaire men – couldn’t get their Bitcoin ETF approved in America, but it appears it’s going to be smooth sailing for crusty old Larry Fink over at BlackRock? Maybe it’s because BlackRock’s ESG policies are more evolved, LOLZ… The 50 Shades of Beige, Midtown Manhattan Edition. What I’m trying to say is that crypto itself was never the problem – this issue is who owns it.
Over 54 Major Crypto SIM Swaps In 2023
One might think by 2023 phone carriers would have taken measures to reduce SIM Swaps from frequently occurring, but nope, 2023 has been a terrible year for victims of these ruthless attacks. What makes it worse is that the majority of those who are targeted are involved in crypto, which means we have to take this subject seriously.
Some of the notable attacks this year have included the Stellar Development Foundation, Bryan Pellegrino (CEO of LayerZero), Garry Tan (CEO of Y Combinator), Pleasr DAO, CoinList, Peter Brandt and Peter Schiff, among others. Not mentioned above is Bart Stephens, who underwent the worst SIM Swap of the year. Read below.
The largest of these attacks involved Bart Stephens, the founder of Blockchain Capital, an early investor in Coinbase, Kraken, and Worldcoin. Last week, Stephens filed a lawsuit against an anonymous hacker who stole $6.3 million from him in May through a SIM swap scam.
I've mentioned Efani a million times over the years, but I can't recommend the service enough if you want protection against SIM Swaps.
Pantera Predicts $148,000 For Bitcoin
Pantera Capital just tossed their hat in the ring of Bitcoin predictions, throwing out the number $148,000 for after the halving. “The 2020 halving reduced the supply of new bitcoins by 43% relative to the previous halving. It had a 23% as big an impact on price. If history were to repeat itself, the next halving would see bitcoin rising to $35k before the halving and $148k after.”
Pantera’s price prediction is high, but it isn't far off many of the others we have seen this year, namely: Fundstrat at $180,000, Blockware Solutions at $400,000, Matrixport at $125,000 and Standard Chartered at $120,000. According to Dan Morehead, the founder behind the firm, the prediction was based off S2F and that, “a whole year had transpired since the Terra Luna and SBF downturns… so the rally can start now.”
Nvidia Skyrockets | Bitcoin Bounces, But Bear Risks Are Still High | Next Crypto Boom Not To Miss!
David Duong, Head of Institutional Research at Coinbase, and Charting Man Dan joined my show to discuss what's happening in stocks and crypto.
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.