The Writing Is On The Wall

It seems that within a single week we’ve flipped from deep skepticism of all things crypto directly to good old fashioned irrational exuberance driven by what seems to be a viral outbreak of FOMO (fear of missing out).

Fauci has not yet made any announcement on whether N95 masks offer sufficient protection against the contagion, but it’s always better to be safe than sorry.

After nearly 18 months of repeatedly taking it up the rectum it’s obviously tempting to get swept up in the rush, especially if you decided against accumulation when the getting was good (i.e. back < BTC $20k).

However I’ve always considered it my duty as your humble host to keep you from extreme sentiment and clear of what might turn into a giant bull (or bear) trap.

That said, sometimes a rally is just that – specifically in this case what we are dealing with is a relief rally after months of frustrating sideways chop during which institutional players continued to accumulate positions at a steep discount (see yesterday’s post but bring your tinfoil hat).

Which is exactly why I must caution everyone against chasing this move up so late in the game. The right time to get positioned was a week ago near the lows. And no matter how good you are, it was a tough one to catch (albeit always clear in hindsight).

Similarly I should warn everyone against attempting to accumulate large short positions in anticipation of ‘bullish exhaustion’ or any other hare-brained theory based on a lack of understanding of what truly drives price action.

That said, at this point it’s fair to say that the writing is clearly on the wall.

Despite all the nay-sayer and the non-stop ridiculing throughout the 2022 bear market – crypto is here to stay, and you are now facing one of two choices:

Choice 1) Continue to demonize and ignore crypto and allow fiat currencies or such derivatives to define your financial future.

If that’s the case then let me ask you this: How’s that working out for you? Enjoying double digit (real) inflation and the never ending boom/bust cycle over the past 20 years?

Choice 2) Embrace the fact that crypto currencies are becoming an integral part of international finance, whether or not you like it, you agree with it, your spouse hates it, and even if you think you missed out and it’s already way too late.

Because nothing could be any further from the truth.

How would I know?

Simple: Actions speak louder than words.

Despite of what you may have been told, TradFi is now balls deep into crypto and at this stage there’s no pulling back out.

And take this one to the bank: the rapid slew of announcements over the past week is nothing but an overture of what will follow post summer and especially as we approach the next BTC halving in early 2024.

If you put aside all the FUD and all the toin-foil hat theories (including my own) there’s but one undisputed immutable constant that will always exist in the markets:

Financial institutions want to make money. It forms the basis of their very existence.

They don’t care what it is, who gets stomped in the process, what they may have done or said yesterday, and even if it encroaches on the current status quo.

Any hurdle preventing them from accomplishing this single goal will either be torn down or swiftly circumvented.

And offering a spot bitcoin ETF is nothing but a giant profit opportunity.

BlackRock, for example, has clients who are willing to pay for crypto exposure, and offering such exposure would generate massive fee$.

While the Securities and Exchange Commission (SEC) has rejected several spot bitcoin ETF applications in the past, I have a strong inkling that BlackRock’s latest filing will suddenly and miraculously ‘meet regulatory requirements.’

And once the new ETF has been approved it will pave the way for future crypto products from the company. Which in turn leads to additional crypto-related products and services.

For example a U.S. managed and regulated crypto based options exchange would be a complete game changer (yeah Deribit isn’t up to snuff, sorry), and huge opportunity for old school option traders like me.

If you think I’m full of bullpucky then take it directly from the horse’s mouth:

During a recent House Financial Services Committee hearing on monetary policy Fed Chair Jerome Powell stated that cryptocurrencies, including Bitcoin, have “staying power.”

He also emphasized the need for a strong federal oversight role in regulating stablecoins which constitute a significant portion of the crypto market.

Hate me for saying this but I completely agree. What’s mainly been holding back the entire crypto sector are fly-by-night operations such as FTX, BitConnect, BitClub, SushiSwap and many others.

Let’s face it. The Wild West days of crypto are over. It’s time to grow up and join the club.

Either that or ‘the club’ will do whatever it takes to wipe you out.

For me that’s an easy choice.

Anyway, it’s already a long post but there are literally exciting crypto related announcements crawling out of the woodwork. For anyone who cares I’ll tack them to the bottom of this post.

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Now here’s what else happened over the past 24 hours:

Crédit Agricole’s CACEIS Gains Crypto Custody Registration in France

CACEIS, the asset servicing arm of Crédit Agricole and Santander and which manages €4.6 trillion ($5.1 trillion) in assets, has received registration from French regulators to provide crypto custody services.

The bank serves asset managers like insurers and pension funds and was officially registered by France’s Financial Markets Authority (AMF) on June 20.

Valkyrie joins rush with BTC spot ETF application to go with its futures, miners ETFs

Valkyrie, which manages $80 billion in assets, has submitted an application for a Bitcoin spot exchange-traded fund (ETF) with the United States Securities and Exchange Commission (SEC).

The company already has experience in BTC futures ETFs, having launched the Valkyrie Bitcoin Strategy ETF (BTF) in October 2021 and the Valkyrie Balance Sheet Opportunities (VBB) in December of the same year. It also operates the Valkyrie Bitcoin Miners ETF (WGMI).

Bitcoin adoption in Mexico boosted by Lightning partnership with retail giant

Bitcoin 2023, the world’s largest Bitcoin conference, recently took place in Miami.

During the conference, a partnership between Ibex Mercado and Grupo Salinas was announced.

In short, the partnership would enable millions of Mexicans to pay their internet bills using the Bitcoin Lightning Network at Total Play, a popular telecoms company owned by Grupo Salinas.

As the conglomerate owns various businesses, this integration marks the beginning of Lightning functionality across Grupo Salinas, including soccer teams and retail outlets.

José Lemus, CEO of Ibex Mercado, believes that Mexico has the potential to become a prominent Bitcoin destination, following the country’s growing crypto adoption in recent years. Further partnerships and projects in Mexico are expected to unfold, contributing to the country’s Bitcoin adoption.

That’s all I got for today. Keep on stacking those coins!