Today’s edition is brought to you by ZKX – the OG Perps Exchange on Starknet.
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GM. This is Milk Road, we serve crypto insights like a pizza delivery guy on game day – hot, fresh, and right to your inbox.
Here’s what we got for you today:
- The path to altseason 📊
- How to stay ahead of the flow of the crowd 🧐
- Dumb money vs. smart money ⚖️
- Reddit bought some crypto 🍪
Prices as of 12:30 PM ET. Click here for our Fear & Greed Index
THE PATH TO ALTSEASON
Yesterday was a slower news day and prices have been playing financial tennis all week…
It looks like Wimbledon out here in the crypto markets.
So, we decided to do something we haven’t done in a while…
We visited the Milk Road “Wisdom Warehouse” - a bank of old tweets, blogs, videos, and explainers we’ve saved over the years.
While dusting off the cobwebs, we found a hidden gem from 2021. (Old, but gold baby!)
It’s from the SecretsOfCrypto Twitter account. Btw - they don’t post much nowadays (probably retired and sipping Piña Coladas on a beach), but the account is still a goldmine.
They created a thread on some of their biggest lessons learned.
There are 12 of ‘em. We’ll save you some time and give you our 3 favorite ones:
1/ THE PATH TO ALTSEASON
To do well in crypto, you need to understand how money flows.
This can be split into 4 phases…
Here are some things to remember:
- The duration of the phases is parabolic. Phase 1 takes the longest and Phase 4 goes the fastest.
- Phases overlap & can temporarily reverse before continuing. But it always ends up at… altseason.
- Altseason is a result of new investors flooding into crypto around the same time. This is usually triggered by events like prices hitting all-time highs, the BTC halving, banks collapsing, etc.
- There can be multiple altseasons per crypto bull cycle. The biggest ones are usually after the end of BTC’s run (when the largest number of new investors enter the markets).
Once you understand the flow of the crowd, you can create some strategies…
2/ HOW TO STAY AHEAD OF THE FLOW OF THE CROWD
Here’s an example game plan from SecretsOfCrypto:
The key is to try to stay 1 step ahead of the crowd. (I.e the stuff in the green above).
While others are zigging, you need to be zagging.
**static noise**
We interrupt your regularly scheduled programming to bring you a quick word from our sponsor…
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**static noise**
And now back to your regularly scheduled programming…
3/ DUMB MONEY VS. SMART MONEY
Pop Quiz: What’s the difference between ‘dumb money’ and ‘smart money’?
Spoiler alert… it has nothing to do with your IQ level. Or where you went to school. Or what your grades were. (phew)
Ironically, it doesn’t even have to do with how “smart” or “dumb” someone is.
It has to do with one big thing… emotions. Specifically, how to control them.
You see, human behavior is driven by emotional impulses. And we all feel emotions - whether we want to, or not.
The big difference is: Dumb money trades on emotions…
…while smart money, recognizes emotions but, doesn't let them dictate their strategy.
They stick to the plan.
BITE-SIZED COOKIES FOR THE ROAD 🍪
Get your hands on the Milk Man’s On-chain Crypto Toolkit. There are a ton of tools out there, and it is impossible to know and cover them all but these are some tools that are free to use and we have experience with personally.
Reddit says it invested a small amount of cash reserves into BTC and ETH. The social media giant also held $MATIC “as a form of payment for sales of certain virtual goods.”
CashApp made $66M in gross profit on its BTC sales last quarter. That’s a 90% year-over-year growth for the mobile payment app.
Paris Saint-Germain (PSG) has become a validator on the Chiliz Chain. The French soccer club has also pledged to pour the revenue earned from validating the Chiliz Chain into fan token buybacks.
Valkyrie launched a new BTC-leveraged product for investors. It’s a leveraged bitcoin futures ETF that aims to provide "2x the daily performance of the S&P CME Bitcoin Futures Index.”
Farcaster has added support for Solana. This allows Solana users to verify their addresses using the decentralized social media platform.
a16z invested $100M into EigenLayer. This is the “cherry on top” for the restaking protocol, whose total value locked (TVL) has jumped from $2B → $7.7B in less than a month.
MILKY MEMES 🤣
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ROADER REVIEW OF THE DAY
VITALIK PIC OF THE DAY
my net worth is in this man's hands
— Milk Road Images (@MilkRoadImages)5:19 PM • Feb 23, 2024
DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.
