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In This Issue:
There’s A Gold Rush Happening
Bitcoin Thoughts And Analysis
Altcoin Charts
Legacy Markets
Crypto Organizations Fight Back
ETH ETF Filers Are Not Giving Up
Standard Chartered Changed Its Mind
This Multi-Trillion Dollar Industry Is Just Getting Started
There Won't Be Enough Bitcoin | Buy Bitcoin Now!
There’s A Gold Rush Happening
On a typical Wednesday morning beneath the expansive roof of Costco, shoppers can find an eclectic array of items—everything from a warm rotisserie chicken and an inflatable hot tub, to a 60-pound tub of honey, a casket, and even a 1-ounce gold bar—all at reasonable prices. Not to forget the classic Hotdog Combo for just $1.50 on your way out.
For those who may not be aware, the gold bars in question are the "1 oz Gold Bar PAMP Suisse Lady Fortuna Veriscan (New In Assay)" and the "1 oz Gold Bar Rand Refinery (New in Assay)." These are simply two popular types of 24-karat, 1-ounce gold bars. True to the spirit of American consumerism, these items are a hot commodity among shoppers.
Originally, these gold bars were available in-store, but now they are only sold online, possibly due to safety concerns or the hassle of frequent customer calls.
On a recent investor call, Costco’s Chief Financial Officer Richard Galanti said, "I've gotten a couple of calls that people have seen online that we've been selling one-ounce gold bars. Yes, but when we load them on the site, they're typically gone within a few hours and we limit two per member."
The success of these gold bars for Costco is undeniable. A CNBC article recently reported that a Wells Fargo analyst estimated that Costco is making between $100 million and $200 million a month from these sales. To put this into perspective, consider that China’s Central Bank purchased about $400 million worth of gold in March alone.
While the $100 million to $200 million represents a gross profit range, it's noted that Costco sells these bars at about a 2% premium—considered a good deal compared to other market alternatives.
So, should you buy the Costco gold bar? This is purely an opinion for educational and entertainment purposes only, as I am not a financial advisor or a gold expert. If you’re already a Costco member and see the gold bars available online, it could be a reasonable purchase. However, buying a gold bar simply because it's the current trend seems impractical.
Online forums have discussed the benefits of purchasing these bars to earn Costco rewards and credit card points, though it's unlikely to offset the difference since Costco does not sell them at spot price, and taxes applied may not be refundable in your state.
Moreover, the popularity and scarcity of these bars do not enhance their resale value. These are standard gold bars without historical or limited-edition significance, readily available on the market.
Potential sellers might face tough negotiations with savvy buyers in the secondary market, possibly ending up with less than a fair price. Selling online also involves shipping costs and potential capital gains taxes if sold at a profit.
Owning physical gold is costly, impacting your finances both at the point of purchase and sale. This highlights a significant point of comparison with Bitcoin, where transaction fees, such as those on Coinbase’s Advanced platform for buying spot Bitcoin, are substantially lower than the premiums and taxes associated with buying and selling physical gold.
Whenever I consider an investment, especially gold, I naturally compare it to the potential returns of Bitcoin. Personally, I don't see any 5-year period ahead where gold outperforms Bitcoin, so for that reason, I'm out. I would much prefer to pass down Bitcoin rather than gold to my children.
Regarding the global macro gold market, I'll refrain from delving deep as many of my readers are likely more knowledgeable on this subject. Despite reports of central banks purchasing gold, my preference leans heavily towards Bitcoin.
Gold has an established historical significance, but it's either tied with or falling behind Bitcoin in nearly every other aspect. I'm more inclined to invest in an asset that recently underwent a programmed supply cut and is just 15 years into its existence, rather than an ancient one with an uncertain total supply.
Everyone has their own investment preferences, but for me, the digital gold rush is far more compelling than what's happening at Costco; if anything, it seems like a distraction. Physical gold may currently attract uninformed investors, doomsday preppers, and casual Costco shoppers, but in my view, Bitcoin is poised for global ascendancy.
For me, it's simple: a Hotdog Combo and Bitcoin are all I need.
Bitcoin Thoughts And Analysis
Bitcoin is “boring” and ranging sideways. This is a decent time to take a look at altcoins, if you are actively trading. No clear signal on Bitcoin for now.
Altcoin Charts
For those who are new here, I share SETUPS and not SIGNALS. These are ideas that I am watching - if a certain thing happens, then the trade triggers. I am not telling you what to buy or when. I am showing you how I am watching certain charts and what has to happen for me to take a trade.
This is an interesting chart, on one of the most hyped projects of the past few months. As you can see, this coin effectively pulled a 10X in 2024 before pulling back, which always happens after a massive run.
It appears that CORE is forming an inverse head and shoulders of sorts (usually more clear at a bottom than in consolidation like this). More importantly, whether it is an IHS or not, this has a clear resistance around $2.91. A break above that should send price back to the all time high. If that happens, we can talk about blue skies above. The “safest” trade is a retest of resistance as support - although this opportunity does not always present.
This also looks great on Trading Alpha. As you can see on the daily, price is trading above the trackline with grey dots. The weekly (not pictured) looks amazing as well.
More information on CORE from CMC:
Core (CORE) is built as an L1 blockchain that is compatible with Ethereum Virtual Machine (EVM), therefore it can run Ethereum smart contracts and decentralized applications (dApps). The Core network is powered by the “Satoshi Plus” consensus mechanism, which secures the network through a combination of delegated Bitcoin's mining hash and delegated Proof-of-Stake (DPoS). The protocol is backed by its native token, CORE.
The developers of the project strive to create an infrastructure that operates at the core of web 3.0, offering revolutionary ideas to solve the blockchain trilemma.
The mainnet was launched in January 2023. The blockchain is governed by a decentralized autonomous organization (DAO), where the Core DAO is responsible for the development of the Satoshi Plus ecosystem.
*I own this token.
Legacy Markets
European stock markets experienced mixed results as a technology sector rally barely offset poor performances in the banking and luxury sectors. The Stoxx Europe 600 index saw a slight increase of 0.1% following significant advances earlier in the week, primarily driven by a 2.3% rise in the technology sub-index. Key contributors to this rise included ASM International NV, which surged after exceeding order expectations, and a positive industry outlook from U.S. peer Texas Instruments.
Conversely, the banking sector faced downturns, with notable declines from Lloyds Banking Group Plc and Svenska Handelsbanken AB due to disappointing earnings. The luxury sector also struggled, particularly Kering SA, which saw a significant drop after a profit warning due to slowing sales at Gucci.
In the U.S., equity futures, especially for the Nasdaq 100, showed gains largely influenced by Tesla Inc., which soared over 10% in premarket trading following the announcement of launching less expensive cars.
Other significant movements included a drop in Evotec SE shares by up to 31% after projecting weak guidance, and Volvo Car AB which fell by 8.8% after missing first-quarter earnings estimates. Meanwhile, companies like Reckitt Benckiser Group Plc and Heineken NV saw stock increases due to positive earnings reports.
Overall, the global markets remained watchful, with upcoming earnings reports from major tech companies like Microsoft Corp., Meta Platforms Inc., and Alphabet Inc., potentially influencing future market directions.
Key events this week:
IBM, Boeing, Meta Platforms earnings, Wednesday
Malaysia CPI, Thursday
South Korea GDP, Thursday
Turkey rate decision, Thursday
US GDP, wholesale inventories, initial jobless claims, Thursday
Microsoft, Alphabet, Airbus, Caterpillar earnings, Thursday
Japan rate decision, Tokyo CPI, inflation and GDP forecasts, Friday
US personal income and spending, University of Michigan consumer sentiment, Friday
Exxon Mobil, Chevron earnings, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.1% as of 9:41 a.m. London time
S&P 500 futures rose 0.2%
Nasdaq 100 futures rose 0.6%
Futures on the Dow Jones Industrial Average were little changed
The MSCI Asia Pacific Index rose 1.7%
The MSCI Emerging Markets Index rose 1.6%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro fell 0.2% to $1.0684
The Japanese yen was little changed at 154.89 per dollar
The offshore yuan was little changed at 7.2661 per dollar
The British pound fell 0.2% to $1.2426
Cryptocurrencies
Bitcoin rose 0.3% to $66,556.51
Ether rose 1.3% to $3,249.9
Bonds
The yield on 10-year Treasuries advanced three basis points to 4.63%
Germany’s 10-year yield advanced three basis points to 2.53%
Britain’s 10-year yield advanced five basis points to 4.29%
Commodities
Brent crude fell 0.1% to $88.32 a barrel
Spot gold fell 0.2% to $2,317.67 an ounce
Crypto Organizations Fight Back
The Blockchain Association and the Crypto Freedom Alliance of Texas (CFAT) have jointly filed a lawsuit against the SEC in the Northern District of Texas. This legal action challenges the SEC's recent expansion of the "Dealer Rule," which they argue is a tactic aimed at stifling the U.S. digital asset market.
The root of the lawsuit stems from the SEC's move to redefine the term "dealer" within the Securities Exchange Act of 1934. This redefinition broadens the scope of who must register as dealers, subjecting more participants in the crypto market to rigorous registration requirements, membership in self-regulatory organizations, and compliance with federal securities laws. The plaintiffs contend that this expansion imposes a vague and burdensome regulatory framework on digital asset trading businesses. They argue that the SEC has not sufficiently addressed public concerns or evaluated the rule's potential adverse effects.
ETH ETF Filers Are Not Giving Up
Yesterday afternoon, as anticipated, the SEC delayed Grayscale’s and Franklin Templeton’s ETH ETF applications. Despite this setback, Grayscale promptly proceeded by officially submitting its Form S-3—a standard procedure for registering securities with the SEC.
Additionally, the SEC has progressed with BlackRock's application by filing it and officially requesting public comments. Although the outlook remains challenging, BlackRock is a seasoned player in the ETF space and is likely to achieve its goals eventually. A denial, in this context, is viewed not as a setback but as a stepping stone towards eventual approval. Thus, the prospects for an ETH ETF appear promising in the long run.
Standard Chartered Changed Its Mind
Two days ago, I mentioned in the newsletter that Standard Chartered was optimistic about the Ethereum ETF being approved in the current round. However, the bank has since revised its outlook, now deeming it unlikely that the ETH ETF will receive approval in May. Despite this, Standard Chartered continues to hold a bullish stance on Ethereum, maintaining their price target of $8,000 by year-end and projecting it to reach $14,000 by 2025. Below are some notable excerpts from their most recent report.
“Bitcoin exchange-traded fund (ETF) inflows have stalled, and ether ETFs now look unlikely to be approved in May as expected. U.S. Securities and Exchange Commission (SEC) has targeted decentralized finance (DeFi) by suing Uniswap, U.S. Treasury yields have jumped, Federal Reserve rate cuts have been pushed back, and BTC and ETH – as risky assets – have been pulled lower by the escalation of the conflict in the Middle East. The bad news is already priced in for bitcoin and ether, and positive structural drivers are expected to take over again.”
This Multi-Trillion Dollar Industry Is Just Getting Started
I believe that Real World Assets (RWAs) are set to revolutionize the cryptocurrency space, similar to the impact stablecoins had when they first emerged in 2014. To understand why the RWA space is beginning to gain traction, Cointelegraph conducted an extensive interview with RWA experts and founders, Victor Sanchez and Alan Keegan. Their insights reveal the potential and the early-stage excitement surrounding RWAs, despite the nascent stage of this development.
“RWAs are a multitrillion-dollar opportunity, and these big institutions are aware that blockchain technologies can go from 0 to 100 in a single bull market.
Being able to transfer assets globally, 24/7, with T+0 settlement by itself is a huge benefit blockchains offer once the regulatory hurdles of using them to transfer securities are overcome.
It’s difficult to think of any transaction type that won’t be improved by being on-chain once we’ve done the regulatory work to actually use the blockchain as the financial infrastructure layer and unlock its potential.
Corporate treasuries could be held in on-chain assets, and corporate debt issuance could happen through a DApp. Any modern financial asset can be issued and traded on-chain, and any modern financial service can be provided on-chain.”
There Won't Be Enough Bitcoin | Buy Bitcoin Now!
I am joined by Jon Najarian, Co-Founder of Market Rebels, as we analyze the post-Bitcoin halving crypto trends. My friends from The Arch Public, Andrew Parish, and Tillman Holloway, are joining in the second part of the stream to provide an update on the $10K algorithmic portfolio (hint: it's been doing really well!).
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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.