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Here’s what we got for you today:
- ✍️ Stocks up, crypto suffering. (Here’s why)
- ✍️ What to watch for this week
- 🎙️ The Milk Road Show: A Crypto VCs Inside Take On Adoption & How To Profit From It w/ Mike Dudas
- 🍪 Friend.tech locks smart contracts, no future updates
Prices as of 9:30AM ET. Click here for our Fear & Greed Index
STOCKS UP. CRYPTO SUFFERING. HERE’S WHY 🤕
Can you hear that?
That’s the sound of your frumpy, traditional asset-loving uncle laughing. 😂
Since mid-to-late April, the S&P 500 has been on an upward trajectory, while Bitcoin (and the rest of the crypto market) has been trending down.
So why the divergence?
Well, mostly for the same reason your frumpy uncle loves traditional assets/indexes like the S&P 500 – they’re lower risk.
And of late, the market’s appetite for risk has been waning – meaning investors have been happy to buy the S&P 500’s dips, and remained wary of doing the same in crypto.
So what’s it going to take to get them back on board the crypto train?
Money.
Like, lots of money.
(And it needs to be pumped into the system at high volumes).
The key to that: Rate cuts and quantitative easing (aka: QE).
Rate cuts lead to lower loan/credit repayments, which leads to more money in everyone's pockets, while giving everyone greater incentive to take out loans and start spending. 💸
While ‘quantitative easing’ is a needlessly technical term to describe what is essentially just a central bank shopping spree.
Central banks begin purchasing shares in major financial institutions → helping to bolster their stock prices → which helps to push the rest of the market up over time.
“Ok, so wen pump?” – you, probably.
The date to watch is September 18, 2024. 📅
That’s when the Federal Reserve meets next to discuss/decide upon a potential rate cut – a rate cut that Fed Chair Jerome Powell all-but confirmed a few weeks back.
Now – a cut won’t instantly fix crypto’s S&P divergence problem (it takes time for the market to psych itself into going risk-on).
But each rate cut gets us one step closer to the fabled ‘Banana Zone.’ 🍌
And once we’re there – we can all call our uncles and tell ‘em to stick it (respectfully).
But this price gap between Bitcoin and the S&P 500 isn’t the only divergence we’re seeing.
Across much of the crypto ecosystem revenues, adoption and general use of blockchain technology are hanging out around all-time highs. 🚀
…yet prices are still in the toilet (what gives)?
Today, on The Milk Road Show, Kyle Reidhead is joined by Mike Dudas (co-founder of 6thManVentures and previous founder of The Block and LinksDAO), to get an inside take on crypto’s growing adoption and how to profit from it.
In this episode, they discuss:
- Price vs. adoption
- What’s driving all this growth?
- What’s holding crypto back from going mainstream?
Click below to get the full 33 minutes and 15 seconds of insight 👇
YouTube | Spotify | Apple Podcasts
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WHAT TO WATCH FOR THIS WEEK 📅
Batten down the hatches and prepare for volatility, folks.
This week’s macro outlook is stacked with multiple (potentially) market moving events…
1/ Macro events 📊
Here’s what’s on the agenda this week:
- US Presidential Debate - Tuesday: Crypto/financial markets tend to react positively to signs that Trump will win in November. All eyes will be on this debate!
- August CPI Inflation data (YoY & MoM) - Wednesday: Is inflation continuing to taper? We’re about to find out…
- Initial/Continuing Jobless Claims data - Thursday: How many people are filing for unemployment for the first time (initial), along with those continuing to file/collect.
- August PPI Inflation data - Thursday: How much did the wholesale cost of goods increase in August?
- MI Consumer Sentiment data - Friday: A vibe check with consumers (are they ready to spend? Or tightening their purse strings?).
Here’s what we want to see:
CPI and PPI continuing to cool, jobless claims staying relatively flat, and consumer sentiment meeting or beating forecasts.
This should indicate that consumer earning/spending will continue, and help to reassure the Fed that lowering rates won’t risk further upticks in inflation.
The key metric to watch: Core CPI Inflation (as opposed to Headline). This is the metric the Fed relies upon the most when monitoring inflation. 👀
2/ Earnings 💣
Earnings Season (aka: the popularity contest measured in revenues, profits, and forward looking statements) continues!
Here’s who’s taking center stage this week:
We’ll mainly be focusing on Oracle this week – they sell cloud infrastructure and back-office apps across a range of US industries (including, but not limited to tech).
If Oracle can continue to perform as it hovers around all-time highs, this will help to reflect ongoing/increasing demand from the businesses it serves. 📈
3/ Token unlocks 🔓
This week we’re seeing $158.52M of unlocks from three well known projects:
- $APT: $69.89M (2.3% of circulating supply)
- $ARB: $47.67M (2.7% of circulating supply)
- $STRK: $26.66M (3.6% of circulating supply)
Watch for potential outflows! 👀
BITE-SIZED COOKIES FOR THE ROAD 🍪
Mastercard and Mercuryo have teamed up to launch a non-custodial crypto debit card called Spend. The card allows users to spend crypto directly from their wallets, avoiding intermediaries and integrating with Apple Pay and Google Pay. - DL News
Ether.Fi is launching a Visa card that lets users spend fiat while borrowing against their crypto. The card offers 3% cashback on all purchases and operates on Scroll's Layer 2 network to reduce transaction costs.
The Friend.Tech team has renounced control of their smart contracts, locking the system and preventing future updates. After initial success, the platform's growth stalled, and the team transferred control to a null address.
Tether has invested $100 million in Adecoagro, acquiring a 9.8% stake in the Latin American agricultural company. This marks Tether's first venture outside crypto, aiming for long-term returns in agriculture amid rising stablecoin competition.
Join forces with the Milk Man! We’re looking for a Twitter Specialist + Content Creator who can mix crypto knowledge with top-notch tweets. Think you’re the one? Apply today and let’s get this show on the road!
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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.
