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In This Issue:
Lessons From The Mooch
Bitcoin Thoughts And Analysis
Legacy Markets
The ETF Race Visualized
Nexo Rises From The Grave
Are They Learning or Did They Forget?
Bitwise Publishes Its Public Bitcoin Address
Bitcoin Will Hit $170,000 After The Halving | Anthony Scaramucci
Lessons From The Mooch
Anthony Scaramucci is a bonafide legend on Wall Street, in mainstream media, and in the realm of American politics. Affectionately nicknamed "The Mooch," he steers the ship at SkyBridge Capital, an alternative asset manager that’s known for making significant waves in the crypto industry. Scaramucci's captivating personality and fascinating stories make him a standout guest. Plus, he isn't afraid to make wild predictions.
I'm fortunate to have the Mooch as a semi-regular guest on my show. He was on yesterday, and shared some incredible insight.
Let’s hear what the Mooch had to say.
Our conversation commenced with me casually inquiring whether Anthony had crossed paths with Jim Cramer. As it turns out, he indeed had and shared a pretty entertaining story.
Anthony: I cold-called Jim Cramer, I was a first or second-year student at Harvard, and I told him I wanted to get a job on Wall Street. He asked me, do you read the WSJ? I admitted no. Do you read the business section of the NYT? I admitted no. Do you read Barrons on the weekend? I said no. He said go F yourself, you're not ready for a job on Wall Street and he hung up the phone.
People of his ilk and generation, don't understand the technology. You pick the person, Jamie Dimon, Jim Cramer, they haven't done the homework. The homework is a one-way ticket toward Bitcoin. I have yet to meet a person of my vintage or older and have drawn the conclusion that Bitcoin sucks, digital assets suck, or the blockchain sucks. It is a one-way ticket toward the asset class.
The moral of the story? Investing in Bitcoin demands doing the homework.
Next we discussed SkyBridge’s remarkable comeback from 2022 to 2023 and explored his predictions for 2024.
Anthony: In 2022, I could have been a monkey flipping coins and done better. Every financial decision I made went bad. I went from 1 to 0. By the end of 2022, I thought 2023 would be the worst year of my career. I was expecting Bitcoin to go to $8,000, anticipating the aftermath of Sam to deplete all of my assets. It turns out that when you think things are really bad, that's where the bottom is.
You mentioned my $170,000 predictions. That's a data-dependent prediction. Go back and look at Bitcoin halving cycles; the day it halves, multiply the price by 4, and 18 months later it's been uncanny — that's the price of Bitcoin. I'm using a $45,000 number at the halving; that's conservative. Let's say we use $50,000 in April; then it's a $200,000 handle. Suppose it's at $60,000; that's $240,000.
My long-term price target is that Bitcoin easily reaches half the market capitalization price of gold. With gold at $14.5 trillion, if Bitcoin reaches $7 or $8 trillion, that's a 10x from here — so $400,000 BTC. I think it would be ridiculous for people not to understand the asset and the dynamics of it as a store of value and not to have a position.
I then went on to ask Anthony the question on many of our minds - is Larry Fink really one of us now? Sometimes we question if someone is here because they are orange-pilled or if they are talking their book. What do you make of Larry Fink’s conversion?
I know him personally; I met with Larry Fink in November of 2021 in the lobby of the Four Seasons in Abu Dhabi. He asked me if I liked Bitcoin, and I said I did. He said Bitcoin sucks; it’s a stupid asset, but I made an investment in Circle, and I think blockchain is good, and stablecoins will be successful. I told him he was wrong and needed to do more homework. Larry was on the road to Damascus and did the homework. He took the orange pill and understands it.
It takes a very smart leader to pridefully say Bitcoin sucks and then 24 months later say, ‘I got this wrong, and BlackRock needs to be a part of this.’ He has admitted it’s a store of value and represents a flight to quality.
Finally, I asked him about the pain of the last cycle.
Me: Do you think we are done with the last cycle of contagion and bad actors?
Anthony: I don't believe we are finished because there is still an unwind of inventory that has to take place, such as with FTX and Genesis. There is still inventory remaining. By the halving, we will be done with the exogenous factors of the last cycle. We are now down to the remnants of the exogenous influences of the last cycle. When Cramer mentioned that Bitcoin can't find a floor, it marked the interim low. It's not inconceivable that Bitcoin could reach $55,000 by the halving. The demand is pooling, and the supply is decreasing.
After this point, my time with Anthony concluded, and we agreed to do another show when Bitcoin reaches the all-time high, which promises to be even more enjoyable than this one. The interview was exceptional, and Anthony stands out as one of the few elites in the crypto industry who can be trusted. It’s hard to come by someone like Anthony and the industry is lucky to have him.
It's remarkable how far Bitcoin and the industry have progressed, yet simultaneously, we find ourselves engaged in conversations about the ETF that are equivalent to the first swing of the first inning. There’s so much more to come, starting with the price of Bitcoin at the halving; and whatever it is, a 4x from there sounds good to me.
Bitcoin Thoughts And Analysis
I have showed a multitude of my own blue and grey charts of late, but want to revisit the Trading Alpha indicator that has become my go to way to screen and analyze the market.
As you can see, the daily chart is still all around bearish, showing red dots and price trading below the track line, which is also now red. As you can also see, Trading Alpha offered a nearly perfect short opportunity when the dots turned red near the top.
This remains the easiest way to quickly check any asset. If you are actively trading this market, I can’t recommend this indicator enough.
I will be waiting for the red dots to subside and for price to trade above the track line to start flipping more bullish.
Legacy Markets
Global stocks took a breather as Tesla's underwhelming results dampened the market's upbeat mood, while anticipation built around the European Central Bank meeting and forthcoming U.S. economic data. Tesla's shares plunged over 8% in premarket trading after the company reported earnings below expectations and hinted at slower growth, affecting Nasdaq 100 futures which showed little movement. The market's reaction wasn't uniformly negative, however; IBM's shares surged 7% in premarket trading following a positive revenue forecast.
In Europe, tech earnings painted a mixed picture. STMicroelectronics reported weaker customer demand and subdued sales guidance, while South Korea's SK Hynix also faced a decline after announcing its results. Despite these tech setbacks, Europe's Stoxx 600 index remained steady, and the Euro Stoxx 50 slightly increased, continuing its strong performance.
Investors, while digesting these corporate results, also awaited the ECB's rate decision and signals on future monetary policy, alongside U.S. economic data which is expected to show steady growth. Long-term U.S. Treasury yields drew attention too, slightly easing after reaching yearly highs, reflecting concerns over government debt levels and borrowing.
In Asia, Chinese and Hong Kong markets gained, driven by the People's Bank of China's decision to cut the reserve requirement ratio, although the effectiveness of such measures on stock performance remains uncertain.
In other news, Boeing faced a setback with a halt in the production increase of its 737 Max model. Meanwhile, other corporate entities like Wizz Air, Nokia, Swedbank, Comcast, and Las Vegas Sands reported mixed financial outcomes and strategic updates, indicating a complex and varied corporate landscape.
Key events this week:
Eurozone ECB rate decision, Thursday
Germany IFO business climate, Thursday
US GDP, initial jobless claims, durable goods, wholesale inventories, new home sales, Thursday
Japan Tokyo CPI, Friday
US personal income & spending, Friday
Bank of Japan issues minutes of policy meeting, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.2% as of 10:19 a.m. London time
S&P 500 futures were little changed
Nasdaq 100 futures were little changed
Futures on the Dow Jones Industrial Average rose 0.2%
The MSCI Asia Pacific Index rose 0.3%
The MSCI Emerging Markets Index rose 0.6%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0895
The Japanese yen was little changed at 147.62 per dollar
The offshore yuan fell 0.2% to 7.1760 per dollar
The British pound was little changed at $1.2736
Cryptocurrencies
Bitcoin rose 0.5% to $39,984.01
Ether rose 0.3% to $2,222.66
Bonds
The yield on 10-year Treasuries declined two basis points to 4.16%
Germany’s 10-year yield advanced three basis points to 2.37%
Britain’s 10-year yield advanced four basis points to 4.05%
Commodities
Brent crude rose 1.4% to $81.19 a barrel
Spot gold rose 0.2% to $2,018.04 an ounce
The ETF Race Visualized
Examining this graph today, compared to its state in six months or six years, is bound to be intriguing. Our close observation of daily changes will likely seem amusing in hindsight when Grayscale becomes just a minor detail in the larger picture. On another note, Blockworks' Bitcoin ETF tracker shows enhancements worth noting. I suggest checking it out when you get the chance, especially for its updated and precise details on 24-hour volume, assets under management (AUM), and current fees.
Nexo Rises From The Grave
Remember Nexo, the once prominent DeFi lending firm that hit a wall in late 2022, largely due to the FTX debacle? It's back in the spotlight, striving for a last-ditch effort to recoup some of its losses. Nexo is pointing fingers at Bulgaria, alleging the country's "wrongful and politically motivated actions," including what it describes as baseless and heavy-handed criminal investigations.
Nexo claims these actions have dealt a massive $3 billion blow to its operations. Just imagine the deluge of lawsuits that would hit the U.S. crypto landscape if every company, feeling the brunt of regulatory actions, chose to respond in kind. While our industry usually operates without being mired in legal wrangling, sometimes lawsuits are the only path to ensuring justice and equitable treatment. Here's hoping Nexo receives a fair hearing.
Are They Learning or Did They Forget?
Nasdaq recently unveiled its 2024 Global Financial Crime Report, and interestingly, there was no mention of crypto, Bitcoin, or blockchain. As hinted in the section title, it remains unclear whether Nasdaq unintentionally omitted crypto or is simply recognizing that the criminal activity associated with our technology is negligible compared to fiat currency. Regardless, this absence is a positive outcome in my view.
On this topic, in response to Senator Warren complaining about a cartel member who laundered $900,000 in crypto when the entire cartel is somewhere around $900M in years prior, Senator Cynthia Lummis aptly pointed out, “Crypto is clearly not the problem. Criminals and bad actors are. It would be a historic mistake to crush an entire emerging industry based on incorrect data.”
Bitwise Publishes Its Public Bitcoin Address
Bitwise made the decision to publicly share its Bitcoin address in the interest of transparency, garnering high praise from the crypto community. If the collective aim is to prevent the emergence of another FTX, this level of trust is crucial for holding major firms accountable. Hopefully, others will follow in Bitwise's footsteps and also disclose their addresses. I am confident that all issuers genuinely possess the funds they claim to have. However, we were similarly trusting of FTX's representations. Transparency matters.
Bitcoin Will Hit $170,000 After The Halving | Anthony Scaramucci
Anthony Scaramucci will share his thoughts about the ETF approval and its recent performance as well as his price predictions for Bitcoin. Chris Inks will analyze the recent market moves and will offer his best 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.
Thanks for sharing some detailed quotes from your conversation with Mooch. Don’t have any time to listen to a podcast today so really appreciate this