Today's edition is brought to you by Gain powered by Kelp DAO, a one-stop-shop to diversify L2 airdrops and DeFi rewards for $ETH holders.
GM. This is Milk Road, delivering crypto insights so fresh, you’ll want to slap 'em on a sandwich.
Here’s what we got for you today:
- ✍️ USD weakening = crypto strengthening
- 📊 COTD: Weekly crypto fund flows
- 🥛 PRO “Where are we in the cycle?” indicators
- 🎙️ The Milk Road Show: Why Most Investors Miss Out on the Banana Zone Opportunity?
- 🍪 Base reached 4M active addresses during its “Onchain Summer” campaign.
Prices as of 9:30AM ET. Click here for our Fear & Greed Index
$USD WEAKENING = CRYPTO STRENGTHENING 💪
Oh god…
We’re becoming our fathers (send help!).
We just read a headline that said “The DXY Is Breaking Down” and our brains rewarded us with a big ol’ dopamine spike.
And we’re sorry to tell you, we’re about to drag you down with us into this pit of geriatric excitement…
ICYMI: the ‘DXY’ is nerd talk for “the value of the US dollar.”
When the dollar is strong and interest rates are high (returning greater yields), investors tend to keep more of their wealth in USD (who doesn’t love safe/easy returns?).
On the flip side, when the dollar weakens and rates drop, investors often opt to put their cash into (riskier) higher yield assets.
…including, but not limited to: crypto.
And this relationship between dollar value and risk assets is way more important than you might think!
Check out how a weakening dollar has correlated with massive crypto pumps over the years:
…ok, so why all the new excitement?
Well, yesterday the DXY broke to the downside against a long held trend line – all while the M2 Supply (the amount of money sloshing around in financial markets) broke to the upside.
Here’s the math on that:
The US dollar starting to break down (pushing investors to move cash into riskier assets)
+
An increase in money supply (aka: dry powder for investors to put into the market)
= The potential for a boom in risk assets (like crypto) – often referred to as ‘The Banana Zone.’ 🍌
(Feels good right – that dopamine dump?)
The tough part of this is, most investors will miss the opportunity to enter before the Banana Zone breaks out – cause they don’t know which catalysts to look for in the lead up…
Good news is: We dedicated an entire episode of The Milk Road Show to this very issue, where guest host, Lark Davis covered:
- Which indicators to look out for
- When it's expected to hit
- How long it will run for
Click below and get it while it’s hot! 👇️
YouTube | Spotify | Apple Podcasts
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COTD: WEEKLY CRYPTO FUND FLOWS 📊
Judging from current sentiments, you might get the impression that there’s something wrong with the crypto market (that’s it’s sick in some way).
But we just stuck a thermometer in its mouth, and judging by the fund flows from the past week, everything seems… fine.
A little tired, sure. But – if you’ll indulge the metaphor – nothing that warrants “a day off from school” just yet.
Here’re the headlines:
- Crypto asset funds experienced minor net-inflows of $30M. (potentially softened by new macro data that indicated the FED was less likely to cut rates by 50 basis points in Sep.)
- Bitcoin saw the most significant inflows, totalling $42M.
- Ethereum slowed to $4.2M, thanks mostly to Grayscale outflows.
- While Solana saw outflows of $39M – the largest on record. (likely due to a sharp decline in memecoin trading)
Here’s who’s leading the buying:
- The US gobbled up $62M worth of crypto. 🇺🇲
- Canada came in with a $9.2M check. 🇨🇦
- While Brazil took $7.2M. 🇧🇷
Here’s what you might have missed:
Sure, Grayscale’s high fees continue to push investors out of its $ETH ETF – to the tune of $118M this past week...
But it hid an impressive amount of activity in other competing $ETH ETFs, which saw inflows of $104M.
I.e. Grayscale’s trying to hold the thermometer over the stove, but it seems the market is aware of it (no sick note for crypto this week).
PRO “WHERE ARE WE IN THE CYCLE?” INDICATORS 🤔
Crypto moves in cycles, and knowing where we are in the current cycle is crucial for capturing the best opportunities.
The goal is to spot the bull market peak before the inevitable bear market hits your bags hard.
Since timing the top perfectly is almost impossible, we use various indicators to give us a better shot at taking profits before it's too late.
Below are the 5 indicators we track, with a color-coded system to show how close they are to signalling the market peak:
🟢 Plenty of room to run 🏄
🟡 Getting closer to the top signal, but haven’t yet reached the mark ⚠️
🔴 We’ve hit the market top indicator 🚨
Every Tuesday, we update these 5 indicators exclusively for PRO members.
Our advice? Don't wait for all of them to hit 🔴. It's better to take profits as they get closer to that point.
Let's dive in and see if we're anywhere near the top of this bull market. 👇
GO PRO AND UNLOCK:
- Full access to the 5 bull market peak indicators above. 👆
- Full access to the Milk Road PRO Portfolio. 📈
- Our weekly reports that help you invest successfully in crypto. 💰
- Full access to the Milk Road PRO community. 🫂
- 50% off Milk Road's NEW crypto investing masterclass.
PRO REVIEW OF THE WEEK
BITE-SIZED COOKIES FOR THE ROAD 🍪
Blockscout is your next-level block explorer. Multi-chain, highly configurable, and open-source, this essential DeFi tool gives access to all chain data and dApp functionalities. *
Base, Coinbase’s layer-2 solution, reached 4M active addresses during its “Onchain Summer” campaign. The event encourages developers to build on the network, with $2 million in rewards up for grabs. Base previously saw strong adoption, including 268,000 wallets minting over 700,000 NFTs.
State Street has partnered with Taurus to offer tokenization services and plans to launch digital asset custody when U.S. regulations become more favorable. This move highlights State Street's ongoing push into the digital assets space despite regulatory challenges.
Tether has minted $1B USDT on the Tron network, adding to the $33B it has created in the past year. This mint follows a similar $1B issuance on Ethereum just days earlier. Tether uses these mintings as inventory replenishments to ensure liquidity.
Floki has secured sponsorship deals with English Premier League teams, featuring its FLOKI token and Valhalla game on stadium screens and uniforms. This partnership aims to enhance the visibility of FLOKI's ecosystem, which includes a metaverse game and asset tokenization platform. The one-year deal is expected to increase brand recognition and boost community engagement.
*this is sponsored content
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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.
