Today’s edition is brought to you by Own - an Ethereum L2 dedicated entirely to Real World Assets (RWAs).
GM. This is Milk Road, the newsletter that’s more satisfying than the obligatory slap you give to the bags of soil when cruising Home Depot.
Here’s what we got for you today:
- ✍️ Has the market bottomed?
- ✍️ The White House Crypto Summit recap
- 🎙️ The Milk Road Show: Is the Crypto Bull Market Over? The Signals You Can’t Ignore
- 🍪 Saylor says Bitcoin can solve the US debt problem
Prices as of 2:00 PM ET. Click here for our Fear & Greed Index.
HAVE WE BOTTOMED? THIS DATA SUGGESTS WE HAVE 💪
“Fear Leads to Anger, Anger Leads to Hate, and Hate Leads to Suffering Lowered Returns.” Yoda The Milk Man
Why’re we bastardizing a quote from our second favorite swamp-dwelling fictional character?
(Shrek is #1)
‘Cause right now, there’s a whole lot of fear in the market, and it’s only growing.
But here’s the thing: while it may not feel like it, as it stands today, the good outweighs the bad!
Not feeling what we’re putting down? Lemme change your mind real quick! Starting with: the bad…
1/ Markets = down bad
Since Jan 20th, Bitcoin (leader of markets, bringer of gains) is down ~28%
2/ Vibes = down worse
The Fear & Greed index (F&G) recently bottomed out at 10, marking the highest amount of fear in the crypto market since the Terra Luna crash (and resulting fallout) back in 2022.
And while F&G has since rebounded to 20 – anything between 0-20 is considered ‘Extreme Fear’.
3/ Layoffs are spiking
US layoffs just hit their 4th largest spike in 25 years – an increase that has never been seen to this degree outside of recessions.
Feeling anxious? Let’s fix that with: the good news…
4/ Layoffs are likely spiking because of DOGE
In 2024, ~50% of new jobs were federal positions – and as we all know, Elon Musk has recently been set loose on government jobs, cutting in the hundreds of thousands.
So this sudden spike in layoffs is likely due to DOGE’s cuts more than anything else.
5/ Open Interest (OI) is down
In short: high OI can indicate that the market is overheated, and due for a pullback. Low OI can indicate that the market has cooled, and is due for a bounce.
Bitcoin’s OI has taken a nice little dive of late, indicating that we may well have found (or at least be close to finding) our bottom. 👇
6/ Onchain fundamentals are holding strong!
Sustained use = strength.
7/ Softening inflation could be on the way
On Wednesday, February’s Consumer Price Index data will be released (gauging lagging inflation rates).
This release, along with the next two (tracking March and April’s inflation) will hold extra weight, because lower-than-expected inflation would give the Federal Reserve an excuse to cut rates and pump fresh cash (aka: liquidity) into the system.
And right now, Trueflation’s real-time inflation tracking is telling us that trailing rates are set to fall off a cliff over the coming months!
8/ History could be rhyming…
As the saying goes: history doesn’t repeat itself, but it often rhymes.
And so far, Bitcoin’s price chart for 2024 & 2025 seems to be in harmony – and if it continues, we could be in for a helluva good year!
- A 20-30% pullback in Jan/Feb ✅
- A run up to all-time highs in March ❓
- Yearly peak in Q4 ❓
Here’s the final tally:
Bad news – 3 points
Good news – 5 points
The takeaway: as grim as everything feels right now, the good news still outweighs the bad.
We do not believe this is the end of the current bull run (as many are saying), and expect markets to turn around in the coming weeks/months. 🤝
Stay strong. Stay patient. 🫡
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EVERYTHING YOU MISSED FROM THE WHITE HOUSE CRYPTO SUMMIT 🏛️
When I was in my early twenties and saving up to go backpacking, I worked at a toy store, earning ~$30k per year.
It was nothing notable – and definitely not a “Holy hell, I’ve made it” moment.
But had you gone back in time and told 6-year old me that he would one day work at a toy store and earn 288x his weekly allowance – he would have flipped!
Point is: time affects our reactions.
And the same thing applies to this past Friday’s White House Crypto Summit, where:
- Favorable legislation and minimized regulation for the crypto sector were reaffirmed
- Trump highlighted his commitment to making the US the "crypto capital of the world”
- Brian Armstrong (Coinbase), Michael Saylor (MicroStrategy), the Winklevoss twins (Gemini), were in attendance along with a slew of other big names.
(All of which followed the announcement of a US-based Bitcoin Strategic Reserve and Crypto Stockpile the day before.)
Now, this time last year, this series of events would probably have resulted in the mother of all god candles – ripping markets up and to the right!
…but as we covered at the top: time affects our reactions.
So the most talked about announcement from the event ended up being this:
The President of FIFA unveiled a gaudy trophy, voiced the organization’s intentions to launch a memecoin, and got laughed at by the big-dogs in the room.
Outside of that – all of the announcements had either long been expected or already made (and largely priced in by the market, at least in the short term).
Resulting in a collective reaction that was more “Nothing notable” than “Holy hell, we’ve made it!”
But don’t let the short term sentiment fool you (earmuffs) – last week’s events were still monumental for the industry.
The positive effects will be felt. It’s just going to take time.
WANT A CONTRASTING OPINION ON THE CURRENT MARKET? 🤔
A balanced range of opinions and takes is always healthy.
We’re still bullish on the current crypto market – but what about the other side of the argument?
We just sat down with Michael Nadeau, founder of the DeFi Report, on today’s episode of The Milk Road Show.
In this discussion, he explained his bearish stance on the current crypto market cycle – pointing to things like:
- Solana’s decreased DEX volumes
- Concerns about the impact of Trump's economic policies
- The relative decline in Bitcoin's Market Value to Realized Value charts
Good news is: while bearish short-term, Michael remains long-term bullish on crypto.
Ready to balance out your information diet? Click below to watch the episode! 👇
YouTube | Spotify | Apple Podcasts
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Saylor says Bitcoin can solve the US debt problem. Of course Saylor believes that but to his credit, he’s outlined a detailed plan. - DL News
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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.
