The Wolf Den #810 - Trillions Will Pour Into Bitcoin
Discover more from The Wolf Den
The Wolf Den #810 - Trillions Will Pour Into Bitcoin
Franklin Templeton, We Welcome You
Welcome to The Wolf Den! This is where I share the news, my ideas about the market, technical analysis, education and my random musings. The newsletter is released every weekday and is completely FREE. Subscribe!
Sign up for my other newsletter, THE DAILY CLOSE!
I built The Daily Close to give you the same institutional-grade indicators and signals that I use to trade the market on a daily basis. It's automatically generated and delivered to your inbox at the daily close everyday.
1 Week FREE for all subscribers
17% discount if you subscribe for a year
$25 a month, or $250 a year
In This Issue:
Trillions Will Pour Into Bitcoin
Legacy Markets
Hashdex Files An Ethereum Spot ETF
CoinEX Hacked For Millions
Tether Gets A Small Win In Court
Buy More Bitcoin | Michael Saylor, CEO Of MicroStrategy
Trillions Will Pour Into Bitcoin
In the heart of New York City in 1947, two visionaries embarked on a journey that would redefine the landscape of investment management in profound ways. A father and son duo, Rupert H. Johnson Sr. and Charles B. Johnson joined forces to create a what would eventually become known as Franklin Templeton, a financial titan steeped in history and wisdom.
Franklin Templeton, for those who don't know the origin of the name, pays homage to Benjamin Franklin, a Founding Father celebrated for his technical ingenuity, entreprenurial pioneering, and of course financial acumen. The name “Franklin” symbolizes trust and economic progress + leadership, virtues central to the company's ethos.
"Templeton," on the other hand, was a tribute to Sir John Templeton, an iconic American-born British investor renowned for his contrarian approach and the legendary Templeton Growth Fund. His investment philosophy and remarkable success inspired the founders and set the stage for what was to come.
In the early years, Franklin Templeton focused on providing investment services to individuals and institutions, finding its footing with a conservative investment approach that emphasized long-term value and diversified portfolios. However, it didn't take long for the company to find its stride in taking progressive risks in areas where other, more conservative industry players, wouldn't dare go.
For starters, at the helm of Franklin Templeton is CEO Jenny Johnson, the daughter of Rupert H. Johnson Jr., a woman in a field predominantly led by men. Second, on the list is that Franklin Templeton is known to expand into ‘higher risk’ regions, i.e. China, the Middle East, Africa, and Eastern Europe that individually face unique geopolitical, economic, or regulatory concerns in order to maintain their commitment to true global expansion and servicing a diverse client base.
Aside from its mission to expand where others aren't willing to, Franklin Templeton has also been committed to offering a comprehensive range of investment products and services that others usually take longer to adopt. I could delve further into the company's history and tech explorations, however, I think you know where this is going. In keeping with its bold and progressive financial ethos, Franklin Templeton remains true to its roots and is now embracing Bitcoin - we are winning.
Yesterday morning, Franklin Templeton took a leap of faith and joined the growing list of spot Bitcoin ETF filers seeking SEC approval, now 12 in total. There has been no official comment on the filing, but what we do know so far is that the ETF’s shares would be held by Coinbase Custody, the fund would be listed on the Cboe BZX Exchange, and the ETF would be a “series” within the Franklin Templeton Digital Holdings Trust.
My takeaway from this news is that Franklin Templeton serves as proof that the effects of an ETF are going to steadily flow in our favor over time. The initial wave of filers was strong, but the reality of Bitcoin making its way into traditional finance is going to be a multi-year journey. Filers will submit applications when it makes sense for them, the SEC may approve ETFs one by one, and capital will flow in overtime, not overnight. How can you be bearish on Bitcoin when another trillion-dollar asset manager is putting its reputation on the line with a large step toward digital asset expansion and innovation?
Assuming the ETFs are approved, every asset manager is going to hire an army of advisors to sell their product to their clients. Billions of dollars will flow into Bitcoin from each asset manager and eventually, trillions as the Bitcoin ETF is viewed with the same acceptance as the GLD ETF. Bitcoin is an exciting journey and now we get to share it with traditional finance, there is no reason to not be bullish.
Legacy Markets
European markets saw a significant decline as signs of stagflation emerged, with the Stoxx 600 Index falling 0.9%. This was accompanied by a weakening pound and euro. There is growing speculation that price pressures will lead to a rate hike by the European Central Bank, even as Germany anticipates an economic contraction this year, and the UK economy experienced its sharpest decline in seven months.
In the US, S&P 500 and Nasdaq 100 futures dipped as Apple Inc. faced a potential second day of declines due to iPhone security concerns in China. Crude oil prices rose following warnings from the International Energy Agency about supply cuts by Saudi Arabia and Russia.
Market participants are preparing for US inflation data, which could have a significant impact given economic worries in Europe. A faster-than-expected inflation reading could unsettle markets and support the case for the Federal Reserve to halt rate increases.
The situation in Europe remains a focal point, with increasing expectations of a rate hike by the European Central Bank as inflation forecasts for 2024 point above 3%. This has led to higher probabilities of policy rate increases. The German two-year yield, sensitive to monetary policy, reached its highest level since mid-August.
In the UK, the pound weakened as data revealed a significant contraction in the economy in July, potentially influencing upcoming interest rate decisions.
Meanwhile, Arm Holdings Plc's highly anticipated IPO is set to price higher than the initial target range, making it the largest listing of the year.
Overall, global markets are in a state of uncertainty, with a keen eye on inflation data and central bank decisions, particularly in Europe.
Key events this week:
Eurozone industrial production, Wednesday
UK industrial production, Wednesday
US CPI, Wednesday
Tech leaders including Tesla’s Elon Musk and Meta Platforms’ Mark Zuckerberg are set to attend a forum on the future of AI convened by Senator Chuck Schumer, Wednesday
Japan industrial production, Thursday
European Central Bank policy meeting and news conference by President Christine Lagarde, Thursday
US retail sales, PPI, business inventories, initial jobless claims, Thursday
China property prices, retail sales, industrial production, Friday
US industrial production, University of Michigan consumer sentiment, Empire Manufacturing index, Friday
Stocks
The Stoxx Europe 600 fell 0.9% as of 12:21 p.m. London time
S&P 500 futures fell 0.2%
Nasdaq 100 futures fell 0.2%
Futures on the Dow Jones Industrial Average fell 0.2%
The MSCI Asia Pacific Index fell 0.2%
The MSCI Emerging Markets Index fell 0.2%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro fell 0.2% to $1.0731
The Japanese yen fell 0.2% to 147.39 per dollar
The offshore yuan rose 0.3% to 7.2803 per dollar
The British pound fell 0.2% to $1.2471
Cryptocurrencies
Bitcoin rose 0.3% to $26,150.76
Ether was little changed at $1,599.44
Bonds
The yield on 10-year Treasuries advanced two basis points to 4.30%
Germany’s 10-year yield advanced four basis points to 2.68%
Britain’s 10-year yield was little changed at 4.41%
Commodities
Brent crude rose 0.7% to $92.68 a barrel
Spot gold was little changed
Hashdex Files An Ethereum Spot ETF
Franklin Templeton's spot ETF submission captured the spotlight today, but it's worth noting that Ethereum recorded its third spot ETH ETF filing, this time by Hashdex, a smaller player in the industry. When it comes to Ethereum ETFs, it's essential to consider that the SEC may have more grounds to deny applications there, given Ethereum's relative youth and lesser market maturity compared to Bitcoin. Nevertheless, Ethereum's swift entry into the spot ETF scene just a few months after Bitcoin is a promising sign. While I don't anticipate major gains on ETH from additional filers seeking approval, the Bitcoin ETF (if approved) could significantly boost Ethereum's chances, thus creating a potential strong uptick in its price and prospects.
Tether Gets A Small Win In Court
Chief Judge Laura Swain of the U.S. District Court for the Southern District Of New York has denied a request to amend a class action lawsuit against Tether and Bitfinex that claimed the two had falsely deceived investors into believing untrue statements regarding the reserves backing their USDT stablecoin. Although this news is positive for Tether and is being celebrated, it is still important to note that, “the New York Attorney General is still conducting investigations on Tether, and the Commodity Futures Trading Commission has registered a civil enforcement action against Tether and Bitfinex.”
CoinEX Hacked For Millions
Another day, another crypto exchange was hacked. Don’t leave your funds on an exchange, period. Unless you want your funds to belong to someone else, then there’s nothing more to say.
Buy More Bitcoin | Michael Saylor, CEO Of MicroStrategy
This Is Not A New Podcast Episode! I am traveling to Singapore for Token2049, so I am sharing an older episode that happens to be a favorite of mine.
“Last year, MicroStrategy publicly announced its decision to buy $425M worth of Bitcoin with its cash reserve. Since then, the trailblazer behind that company has continued to do what he believes in most - buy more Bitcoin. Michael Saylor believes that our inflationary macro environment can be arbitraged by taking on low-interest debt to acquire more Bitcoin and outpace interest payments. Ultimately, it is Michael Saylor’s die-hard belief that has thrust him into the spotlight as one of the most important figures in the crypto community.”
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.