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In This Issue:
Gold Bugs Are Boomer Bitcoiners
Bitcoin Thoughts And Analysis
Altcoin Charts
Legacy Markets
Gary Gensler Believes Ethereum Is A Security
Hong Kong ETFs Launch Today
The EigenLayer Airdrop Is Here
You Can Bet On CZ’s Sentencing
This Is The Worst Possible Scenario For The US | Is Bitcoin An Answer? | Macro Monday
Gold Bugs Are Boomer Bitcoiners
If you lined up Bitcoin enthusiasts and gold investors side by side, it would be surprisingly easy to spot who's who. Bitcoiners tend to be quirky, tech-savvy, risk-seeking, often libertarian, lovers of memes, and typically younger. Gold investors, in contrast, might seem old-fashioned, more risk-averse, less tech-savvy, and could be perceived as lacking in style, often belonging to an older generation.
Yet, despite these apparent differences, the two groups align closely in their fundamental investment philosophies. Both communities seek assets that serve as a hedge against inflation—this realization has dawned on Bitcoiners perhaps more quickly than on their gold-investing counterparts. After a recent conversation with Peter Schiff, a prominent figure among gold investors who often engages with the crypto community, I'm even more convinced that our core beliefs are not just similar but virtually the same. We only diverge when it comes to choosing which asset we believe is the superior inflation hedge.
Following my interview, I visited Peter Schiff’s website, Schiffgold.com, and discovered a striking similarity on his investment philosophy page. His entire thesis could be mistaken for an endorsement of Bitcoin, if only 'gold' were replaced by 'Bitcoin'.
Schiff's argument for gold focuses on familiar themes: "Paper Currencies Increasingly Shaky, A Failed Experiment (fiat), The Global Debt Bomb, and The Ultimate Insurance Policy" - these points should resonate with any Bitcoin enthusiast.
Reflecting on our discussion and reviewing his content, I find myself puzzled over Schiff's reluctance to see the parallels between Bitcoin and gold. Is he overlooking the obvious, or are we the ones skewing reality? I’m inclined to think he’s the one missing the connection, and here are some quotes from our podcast that may shed some light. At times, it's difficult to discern whether Schiff fully believes his own criticisms of Bitcoin or if he's simply playing a role, or perhaps a bit of both.
“I don't tell people to only own gold, or I don't even consider gold an investment; I consider it an alternative form of savings.” – This applies equally to Bitcoin.
“I think that gold is going to do a much better job of retaining its purchasing power over time than any of those fiat currencies, even if you earn interest on them. I don't think the interest that you earn in the bank will offset the purchasing power that you lose to inflation.” – Also true for Bitcoin.
“Bitcoin doesn't have any actual use. There's nothing you can do with your Bitcoin. So, there's no value there that you could store because you can't do anything with it today. So, you won't be able to do anything with it a 100 years from now.” – FUD.
“I think that the ETFs are going to be a big problem for Bitcoin. I think the money that's in these ETFs is not your Bitcoin Maxi type guys. I think it's more traditional people, investors who took a shot at Bitcoin. I mean, they've never bought Bitcoin before, so clearly, if they were philosophically in line, they would have figured out how to open up a wallet and buy themselves some Bitcoin. They wouldn't have had to wait all these years to buy it in their Schwab account.” – FUD.
“I just think this could be the next collapse. If it's driven by the ETFs, it's going to be one of the largest Bitcoin crashes we've ever seen, maybe the biggest one.” – FUD.
“If advisors don't even want to recommend gold, why are they going to recommend Bitcoin? If they think it's digital gold, they won't even recommend actual gold.” – FUD.
“I don't think long-term bonds should be in anybody's portfolio. I just think they're going to get wiped out through inflation. I mean, it's either going to be default or inflation.” – Bitcoiners would agree.
“As the national debt becomes a bigger and bigger burden on the US economy, what is going to be done, right? Because we can't pay it, and so we either have to default, honestly, or we have to inflate.” – Nearly a Bitcoiner’s viewpoint.
“I'd like to see the private sector remonetize gold and using gold as a means of exchange, as a unit of account, reintroducing it in commerce. And the way to do that is through the internet, through blockchain, and, you know, through tokenization.” – Almost advocating for Bitcoin.
Despite these similarities, many in the older generation struggle to embrace new technology. This often represents the thin line separating Bitcoiners and gold investors. However, as younger, forward-thinking investors recognize these parallels, the gap narrows, reinforcing the idea that tradition only lasts as long as there are advocates to sustain it.
Bitcoin stands distinct from traditional asset classes, operating outside conventional financial mechanisms. It serves multiple purposes, accessible to everyone, and is not controlled by any single entity or government, embodying the future of investment.
If you enjoyed this insight, feel free to share it. Thanks for reading!
Bitcoin Thoughts And Analysis
RSI has once again given amazing signal. Clear bullish divergence for the entry. Confirmed hidden bearish divergence for the exit. Easy trade. Will we run it back with bullish divergence again here? We need to see a clear elbow up in RSI if we get the lower low on price.
Regardless, this price action is disgusting and utterly avoidable.
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.
The altcoin market looks exceptionally weak. I ran through a ton of charts on YouTube yesterday, and the summary was there’s no reason to be buying for now…
Legacy Markets
Stock markets are set to close the month lower as traders anticipate that the Federal Reserve might maintain its hawkish stance on interest rates during its upcoming meeting. This speculation has contributed to a stronger dollar and stable Treasury yields. In Europe, shares in major carmakers like Volkswagen, Mercedes-Benz, and Stellantis fell, negating the positive impact of favorable economic data. The S&P 500 is down 2.6% for April, marking its first monthly decline in 2024.
In corporate news, HSBC saw its shares rise after solid earnings and the unexpected resignation of its CEO, which analysts believe could signal a new phase of growth for the bank. Meanwhile, global equities could see a rebound supported by commodity trading advisers holding substantial long positions.
On the earnings front, major companies such as Amazon, McDonald’s, and Coca-Cola are set to report their results. Although recent earnings have shown minimal outperformance, the market's reaction has been muted. In other news, discussions of a ceasefire in the Middle East have led to a significant drop in oil prices, impacting energy stocks.
Key events this week:
US employment cost index, Conf. Board consumer confidence, Tuesday
Amazon, Samsung, HSBC earnings, Tuesday
Labour Day holiday across much of Europe, Wednesday
Treasury’s quarterly refunding announcement, Wednesday
US ADP employment change, JOLTS job openings, ISM Manufacturing, Wednesday
Federal Reserve rate decision, Wednesday
Eurozone S&P Global Manufacturing PMI, Thursday
US factory orders, initial jobless claims, trade, Thursday
Apple earnings, Thursday
Eurozone unemployment, Friday
US unemployment, nonfarm payrolls, ISM Services, Friday
Chicago Fed President Austan Goolsbee speaks, Friday
Some of the main moves in markets:
Stocks
S&P 500 futures fell 0.2% as of 5:55 a.m. New York time
Nasdaq 100 futures fell 0.2%
Futures on the Dow Jones Industrial Average were little changed
The Stoxx Europe 600 fell 0.4%
The MSCI World index was little changed
Currencies
The Bloomberg Dollar Spot Index rose 0.1%
The euro was little changed at $1.0727
The British pound fell 0.1% to $1.2547
The Japanese yen fell 0.4% to 156.91 per dollar
Cryptocurrencies
Bitcoin fell 1.9% to $61,765.6
Ether fell 3.9% to $3,052.11
Bonds
The yield on 10-year Treasuries advanced one basis point to 4.63%
Germany’s 10-year yield advanced two basis points to 2.55%
Britain’s 10-year yield advanced two basis points to 4.31%
Commodities
West Texas Intermediate crude rose 0.2% to $82.82 a barrel
Spot gold fell 0.9% to $2,315.24 an ounce
Gary Gensler Believes Ethereum Is A Security
A new set of documents filed yesterday morning, which has not been made public yet, reportedly reveals that the SEC has been secretly considering Ethereum as a security for over a year. According to the complaint, Gurbir Grewal, the SEC's Director of the Division of Enforcement, issued a Formal Order on March 28, 2023, initiating an investigation into Ethereum 2.0 and explicitly categorizing the asset as a security.
This revelation is particularly troubling given the evasiveness of SEC Chair Gary Gensler when asked directly if he considers Ethereum a security. Despite multiple inquiries, Gensler has consistently provided non-committal and vague answers, avoiding a clear stance. Meanwhile, his agency has approved Ethereum futures ETFs but is expected to deny a spot ETF soon—a conflicting stance that raises significant legal and ethical questions.
In the midst of this regulatory uncertainty, Ethereum has achieved a noteworthy milestone, reaching 1 million validators worldwide. These validators contribute to the network’s decentralization and play a vital role in data storage, transaction processing, and block addition, ensuring the network's functionality and security. Furthermore, 26% of the supply, amounting to 32 million Ether, is staked. This level of participation and staking not only underscores Ethereum's utility but also highlights the global confidence in its future, despite ongoing regulatory challenges.
The Hong Kong ETFs Launch Today
The highly anticipated Hong Kong spot Bitcoin and spot Ethereum ETFs are finally launching today after months of talks, and reports are suggesting that the ETFs may double the size the U.S. saw on its first day of launch. Adding to this good news, the Asian market boasts more participants than the U.S. and Europe combined, and there isn't a Grayscale equivalent that needs to be dumped on the market to counteract the inflows. The thread above includes a transcribed press briefing of two major figures in the Hong Kong ETF scene, with some of the most important Q&A’s copied below.
This one below is partially interesting because investors are showing interest from around the world.
The EigenLayer Airdrop Is Here
EigenLayer has officially launched a countdown to their airdrop, set to begin on May 10th. Accompanying this announcement was a detailed 40-page whitepaper, which dives deep into the technicalities of the platform—a level of detail that surpasses my expertise. Unfortunately, when I attempted to access the airdrop page, I encountered a popup indicating that the site is not available in my region. It turns out the airdrop explicitly excludes the US, Canada, parts of Asia, Africa, and also VPN users.
Thanks, Gary.
This restriction has led to significant disappointment and controversy, especially among those in the crypto community known as 'point farmers,' who had their Ethereum accepted but are now ineligible for rewards. The complexity of the whitepaper has also sparked concerns, as it seems out of reach for the average crypto enthusiast, potentially undermining EigenLayer's public relations efforts. Additionally, there are ongoing frustrations about what some see as another greedy approach to token distribution, though not as severe as others recently observed. A lingering question remains: Why block the airdrop in the U.S. and Canada if the token is claimed not to be a security? This adds a layer of suspicion and confusion to the entire affair.
Here’s the tokenomics TLDR:
Total Supply: 1.67b tokens
Airdrop/Stakedrop: 15% (across multiple seasons, 5% in the first season)
Community Initiatives: 15%
Ecosystem: 15%
Investors: 29.5%
Early Contributors: 25.5%
(1y lock, followed by 4% per month over next two years)
You Can Bet On CZ’s Sentencing
Today, the focus is on the sentencing of CZ, with Polymarket bettors anticipating a lighter sentence than the three years recommended by the DOJ. They predict that he might serve only about six months. Meanwhile, in related news, Bloomberg has reported that the CFTC is contemplating actions against prediction markets. This would particularly affect their operations related to betting on elections and other political events, signaling potential regulatory changes ahead.
This Is The Worst Possible Scenario For The US | Is Bitcoin An Answer? | Macro Monday
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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.