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GM. This is Milk Road. The daily newsletter that serves crypto insights that are so fresh, they make a farmer's market look like leftovers.
Today we’re bringing you the second part of a 2-part special:
The Bear Case: why the crypto market could bleed a little longer
The Bull Case: why the crypto market could bounce back soon
Yesterday we covered The Bear Case.
Today, we’re rinsing that nasty ass taste out of our mouths with some of the good stuff – The Bull Case.
Btw – here are some of our favorite comments from Roaders asking for it:
Etienne: “I need some kisses on my booboo after you rub salt in my wounds”
SND: “Give it to us dirty then some sweet pillow talk afterward”
Mewert: “Just tell me – this is like medicine. Tastes like crap but it will save my life”
Alright, let’s get into the good stuff.
[P.S. – Your heart rate and excitement may rise during today’s edition. If it lasts for more than 90 minutes, please consult a medical professional.]
3 REASONS THE BEAR MARKET COULD END SOON
Today, we’re gonna talk about 3 reasons the crypto markets could explode soon.
(I’m talking about a Mentos-In-Coca-Cola-type explosion)
We’ll explain why we’re excited and rate each reason on the Milk Road Hype-Meter.
1 = “It’s as exciting as ‘Picture Day’ in middle school”
10 = “Holy sh*t, it feels like Christmas morning”
Okay, let’s dive in.
REASON #3: BITCOIN HALVING EVENT
What’s happening: Every 4 years a big crypto event happens…
It’s called the Bitcoin Halving. It’s where mining rewards get cut in half to slow down inflation from the new Bitcoin being mined.
This will keep happening until all 21M Bitcoin have been mined. (expected sometime in 2140)
The next Bitcoin Halving is set to happen sometime in April 2024.
Why this is good: There have been 3 Bitcoin Halvings so far – each one has been a catalyst for big crypto rallies.
Just take a look 👇(post-halving is shaded in pink)
The interesting part is that Bitcoin has seen price increases before and after the halving.
In 2012, BTC rose 365% leading up to the halving, and +8,000% in the year following it.
In 2016, BTC rose 142% leading up to the halving, and +284% in the year following it.
In 2020, BTC rose 17% leading up to the halving, and +559% in the year following it.
In a nutshell, Bitcoin halvings → 50 Shades of Green for Bitcoin → A LOT of happy investors.
REASON #2: ETF APPROVAL
What’s happening: Big financial firms have been lining up to file for Bitcoin ETFs.
BlackRock: $9T in assets under management (AUM)
Fidelity: $4.5T in AUM
Franklin Templeton: $1.5T in AUM
Invesco: $1.5T in AUM
WisdomTree: $87B in AUM
VanEck: $77.8B in AUM
ProShares: $65B in AUM
GlobalX: $51B in AUM
Grayscale: $50B in AUM
Bitwise: $1B+ in AUM
Roundhill: $1B+ in AUM
Side note: It’s funny how a lot of these firms said they wouldn’t touch crypto with a 10-foot pole a few years ago.
Now, they’re all doing that thing where you throw an invisible rope on someone and try to pull them in.
Why this is good: ETFs have historically led to price rallies for assets.
For example, let’s take a look at what happened to Gold.
The first gold ETF (SPDR Gold Shares) was listed on the New York Stock Exchange back in November 2004.
Within the first few days…the ETF saw $1B+ in inflows.
Within a few years…
the price of Gold hit a record high.
The SPDR Gold Shares briefly surpassed the S&P500 Trust ETF to become the world’s biggest ETF.
Source: World Gold Charts
With all the institutions rushing to file for a Bitcoin ETF it’s becoming a matter of when one gets approved to launch, not if.
The best bet? BlackRock.
The king of financial firms has a record of 575-1 when it comes to getting its ETFs approved by the SEC.
(BlackRock is like the Undertaker at WrestleMania – damn near unbeatable)
So, it’s only a matter of time.
Trading tools are kinda like a new pair of shoes: There’s no shortage of them, but you want to make sure you’re getting the perfect fit. (The Milk Man is a Jordan guy)
Well, when it comes to the perfect fit in trading, look no further than Kraken Pro.
Their customizable dashboard allows every trader to lean into their strengths and trade like a pro in minutes.
It’s not just the top-tier design that gets us excited. Traders have access to advanced trading tools and analytics, putting you ahead of the competition.
And with a competitive fee schedule that rewards high volume traders, you won’t want to be trading anywhere else.
Not investment advice. Crypto trading involves risk of loss. Kraken does not offer services to residents of Washington or New York.
And now back to your regularly scheduled programming…
REASON #1: CRYPTO’S FUNDAMENTALS HAVE GOTTEN STRONGER DURING THE BEAR MARKET
What’s happening: While prices have decreased, the overall value of crypto has increased.
I know that might sound confusing so let me try to explain with a quote…
“Valuation oscillates up and down around value” – Dharmesh Shah (billionaire and founder of Hubspot)
You see, value is often associated with the “valuation” (aka prices) of an asset.
The problem? Prices are subject to lots of different variables like economic crashes, high interest rates, forced liquidations, etc.
So although value and valuation are related, they aren’t the same thing.
For example, let’s take a look at ETH’s price.
The price of ETH is down. But does that mean ETH has become less valuable?
Short answer: No.
Long answer: Hell no.
If anything, ETH’s value has increased!
Okay, now back to the overall crypto market. How can we tell if the true value of crypto has gone up?
To answer, we created a simple formula last year.
(The number of people on earth who believe crypto is valuable) x (the intensity of that belief)
While the bear market has scared a lot of people away, there have been plenty of new (and familiar) faces that joined the party…
Shopify integrated stablecoin payments into its platform.
Visa partnered with Solana to make cross-border payments easier.
Telegram (800M monthly users) launched a whole crypto ecosystem including a blockchain, a crypto wallet, etc. – they’re going the whole 9 yards.
Grab (the Uber of Asia) created a new web3 wallet that lets users pay for stuff in crypto.
Twitter added NFT features to its app, and there are rumors that crypto payments could be integrated next.
Musicians and artists around the world have launched their work on the blockchain.
The list can go on and on and on.
Once you take a step back, it becomes clear as day… crypto’s fundamentals are at an all-time high.
And it’s only a matter of time before prices catch up.
Well, that’s a wrap for today’s edition and our 2-part special has officially come to a close.
With all that being said, we’re curious what you think….
A/ We’ll be in the bear market for another 6+ months.
B/ We’ll be in the bull market within the next 6 months.
Hit “reply” to this email with a simple A or B!
BITE-SIZED COOKIES 🍪
Deutsche Bank is teaming up with Taurus to establish crypto custody and tokenization services. The plan is to develop digital asset custody services for a wide variety of digital asset types for corporate and institutional clients.
Binance.US’ Head of Legal and Chief Risk Officer have both quit the company. The moves come after the U.S.-based exchange also had its CEO resign earlier this week. When it rains, it pours.
Genesis has ceased all trading operations. News broke that the company's U.S. operations were shutting down last week, but now it's reported that its international trade operations will also close down. R.I.P.
Grab is partnering with Circle to pilot a new Web3 wallet within the app. Grab has ~180M users and is one of the most popular apps in Southeast Asia.
MILKY MEMES 🤣
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Sep 15, 2023
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.