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GM. This is Milk Road, the crypto newsletter that’s as delightful as getting the last piece of pizza.
Here’s what we got for you today:
- ✍️ Japan says no more rate hikes (for now)
- ✍️ Trading platforms crash
- 🎙 The Milk Road Show: Lessons From This Weekend's Crypto Sell Off
- 🍪 Ethena integrates to Solana
Prices as of 9:30AM ET. Click here for our Fear & Greed Index
JAPAN SAYS NO MORE RATE HIKES (FOR NOW) 🇯🇵
That's right—BOJ Deputy Governor Uchida announced yesterday that the Bank of Japan is halting its plan to continue raising interest rates.
This statement reverses last week's comments about more potential rate hikes. 👏
If you remember (how could we forget), the big sell off last weekend was triggered by Japan deciding to raise rates to 0.25% on July 31st.
That created the deleveraging event from funds who were taking out debt in Japan at 0% and investing it elsewhere. 🌎
The more Japan raised rates, the worse the markets were likely going to get.
But yesterday they were playing Uno with the Milk Man and pulled out one of these.
To put it a different way, the Bank of Japan has been in a game of monetary policy hot potato the last few days, trying to juggle interest rates like a circus performer on a unicycle. 🤹 🎪
SO, is it safe to say that markets overreacted recently?
Well according to the VIX (the volatility index of the S&P 500), the worst market days in the last 20 years were the 2008 financial crisis, COVID and the bank of Japan raising rates by .25%... 😰
🥛 Milk Road Take: It’s looking like all that red from the other day may have been prime time dip real estate, considering Japan has backed off. As we said yesterday, plus many times before, market dips are rarely as bad as they seem and this was a prime example. Of course, Japan could always change its mind again, nothing is for certain… but at the moment, it appears the bull run will continue on! With every big event that occurs in markets, there are many lessons to be learned. It’s valuable to take a second and evaluate what happened to figure out what you could have done better. Kyle Reidhead, head of research at Milk Road PRO joins The Milk Road Show to share his lessons from this weekend's crypto sell off.
One of the main talking points is how to re-evaluate your investment thesis during a pullback and avoid making emotional decisions. 🤬
Make sure to check it out because this likely won't be the last pullback we see this cycle. 😉
Tune in nerds 🫵
YouTube | Spotify | Apple Podcasts
And before you move on to the story below, the Milk Man needs to know...
DID YOU BUY THE F'IN DIP!!??
A/ Yes
B/ No
C/ Tried to but there wasn’t enough cash in the wife’s wallet
Click reply and hit us with your milky thoughts!
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TRADING PLATFORMS CRASH ❌
Struggling to explain to your friends why crypto is the future of finance? Monday’s market madness served up the perfect example.
As Monday morning rolled in hot and heavy, with traders flocking to their screens as recession fears sent markets spiralling. 😵💫
But just 15 minutes after Wall Street's opening bell, the unthinkable happened…
Users from the most popular trading platforms were left hanging—locked out of their accounts like it was some cruel joke. 🤡
They couldn't log in, couldn't sell their stocks, and were basically left to scream at their screens. 💻️
The Charles Schwab site went completely dark, greeting users with a cold note: "experiencing technical difficulties."
Vanguard, Ameritrade, Fidelity, Robinhood, and E-Trade didn’t fare much better…
While they didn’t crash entirely, users reported a frustrating inability to log in,with servers seemingly on strike. ❌
At its peak, Schwab left nearly 14,500 users in the dark, while more than 3,600 Fidelity users found themselves equally stranded, according to Downdetector.com.
This is the stuff of nightmares for retail users—when you can't even see what your portfolio is doing, let alone make any moves. 🙈
Panic mode: engaged. 😱
🥛Milk Road Take: When TradFi fails, Crypto Twitter loves to shout from the rooftops, “blockchain fixes this!” But is that really the case here?
After all, server failures can happen to anyone—even Uniswap.
And while Uniswap's protocol would continue to chug along, everyday users wouldn’t be able to trade their tokens on Uniswap’s website during a server crash.
But here’s the kicker: in crypto, we have a thing called self-custody.
When you custody your own funds, you can just connect your wallet to another DEX and keep on trading. 😎
But your Uncle Jim has his entire net worth in an account with Charles Schwab.
And when their servers go down Jimmy can’t just log in to Robinhood to sell his shares in Intel before they go to 0.
Jimmy is f*cked… 🖕
That’s the beauty of DeFi—anywhere, anytime finance.
TradFi can't touch that kind of freedom—you're shackled to whatever platform you signed up for, for better or worse… 👰
BITE-SIZED COOKIES FOR THE ROAD 🍪
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Hong Kong's crypto ETFs hit $31M in volume during a selloff, a record day since their debut. Despite the surge, volumes tapered off the next day, highlighting ongoing challenges in gaining consistent traction.
The IMF is working with El Salvador on strategies to manage the risks associated with Bitcoin as legal tender. Discussions also include stabilizing the country's public debt and improving financial system reserve buffers.
PlusToken Ponzi wallets, dormant for over three years, moved 789,533 ETH recently. These funds had been stagnant since April 2021 and the reason for the movement is currently unknown.
Ethena has integrated Solana to increase adoption of its USDe stablecoin and added SOL as a backing asset. This integration aims to unlock $2B-$3B in additional open interest in the $SOL futures market.
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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.
