Happy Labor Day to all my American friends!
Some commentators started talking about another bear flag on the weekly trading chart. That’s bad news for anybody who wants crypto prices to go up.
For my thoughts on that, catch the update from September 1, 2022.
Bitcoin finished green for the week. So did the DXY, a common measure of the US dollar’s price. Meanwhile, the S&P 500, Dow Jones Industrial Index, and NASDAQ 100 all finished down for the week. So did corn.
Is this a one-week divergence from well-established correlations or the start of a regression back to crypto as a non-correlated asset?
We’ll find out in many months, once the data people have a chance to run the numbers.
Since June’s market collapse, we have seen a surge in the number of wallets holding more than $2,000 worth of bitcoins. It’s still trending up, as you can see in my Accumulatoors chart.
That chart splits out separate bars that represent various sizes of wallets, from big to small, so you can make some inferences that you can’t make from the aggregate data.
We don’t see a small number of large holders dumping on a large number of small holders while the total amount of wallets goes up. Instead, people at all levels are stacking sats.
While that sounds nice, we still don’t see a lot of new money coming in. Just people like us padding our stash. Until that changes, the market can’t go up.
Story of 2022.
Poll: when will the bear market end?
Congressman flags rising crypto fraud, demands answers from regulators
Bottom line: a Congressional committee wants to know what actions regulators and crypto exchanges have taken to combat fraud and clarify confusing and overlapping authorities.
My take: this is a smart and balanced approach to lawmaking but it won’t matter for any committee hearings. Those are just opportunities for Congresspeople to use other people’s words to make their own points. For enemies of crypto, no response will be good enough. For friends of crypto, every response will seem reasonable. For the exchanges, they just need to show they’re doing good things. Hopefully, they get some good PR out of this, too. For us, this is irrelvant. All the important details will get sorted out privately among the members and their staffs.
Why we care: when you hear “Congress” and “crypto” you may get worried but the reality is more nuanced than that. We have a lot of allies, we just need to give them good reasons to advocate for us. Hopefully, the exchanges will do just that.
NFTs are not dead and neither are scams. @zachxbt has another thread on some shenanigans you may have missed.
Some think US regulators need to double their investigative staff, but they really just need to hire a few on-chain Twitter sleuths. The blockchain exposes all.
Speaking of NFTs and things that are dead, you may appreciate a video I recently posted.
As we go through the regulation/litigation phase of crypto’s development, keep this tweet handy as reference. You’ll need it once lawmakers and regulators hand crypto over to the institutions (not the 2020-2021 meme but actual legacy finance and the people who run it).
As I wrote in Bitcoin or Bust: Wall Street’s Entry Into Cryptocurrency, legacy finance will bring a deluge of money into this space but it will also fundamentally change the nature of the technology and the investment opportunity.
Plan accordingly.
BTW you get Bitcoin or Bust and my other ebooks for free when you move from free to paid membership.
Relax and enjoy the ride!
Weekly Rundown - September 4, 2022