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Veterans Day is here. This is also known as the first day that bitcoin rose above $86,000.
Ah, yeah, the crypto exchange that filed for bankruptcy two years prior. FTX was the name, I believe. It is worth mentioning that US bitcoin spot ETFs were launched today, 10 months after they were first introduced.
First, let’s talk about bitcoin. Donald Trump’s crypto promises and his ultimate election victory (alongside pro-crypto Congressmen) have certainly sparked an additional euphoria in the industry.
Matt Hougan of Bitwise had predicted that BTC would reach $100,000 before the end this year, and then continue to rise in 2025. Aside from the expected general crypto regulatory clarity, he and others continue to point out the possibility of BTC becoming a US reserve asset — an idea floated by US Sen. Cynthia Lummis.
“I think it makes it a harder market to short because we could wake up at any moment and the US could be establishing a strategic bitcoin reserve or another country could be front-running the US establishing a strategic bitcoin reserve,” Hougan explained. “That was just a wild idea that you couldn’t consider [before].”
Rumors suggested that a nation-state was behind the latest price hike. We found out that the company known for hoarding BTC has made another large purchase (more about that later).
Blockworks’ co-founder Jason Yanowitz summarized crypto market vibes in a screenshot taken from a Bernstein research note on Monday:
“We recommend investors who have so far remained shy of any crypto exposure due to regulatory concerns invert their mental model,” The analysts wrote. “We are in a regulatory tailwind zone now.”
Some have warned against short-term gains “retrenchments,” BTC can go up or down, we all know that.
Copper.co Research Head Fadi Abualfa cautioned also that securities laws wouldn’t change over night, and that BTC remains tightly tied to broader economy forces.
“Inflation is still elevated, interest rates haven’t eased, and the US dollar remains strong; these forces are not sustainable in tandem,” He sent an email. “One will eventually weaken. The real question is: Which one, and why?”
It’s amazing that BTC reached a new high exactly two years after FTX declared bankruptcy. Re-reading a piece I wrote on Nov. 11, 2022 — titled “What’s next for FTX and its customers after bankruptcy filing?” — was a bit surreal.
Bitcoin’s value had fallen to around $16,000 during that particular month. It’s about one-fifth the value of bitcoin today.
BlackRock’s entry into the race to launch an ETF that would track bitcoin in June 2023 seemed to change sentiment. Less than seven months later, the SEC greenlit those products; BTC eclipsed $73,000 a couple months after that — a high that would stand until election night last week.
The US BTC spot ETFs have been available for exactly 10 months. On November 7, net flows into these products reached a record-breaking $1.4 billion in a single day. The category now has a total of more than $28,8 billion after raking in an additional $293 million in November 8.
These vehicles will play a major role in helping institutions that want to be exposed to bitcoin (especially in an environment more friendly) to easily achieve their desire.
Other spot crypto ETFs are also planned. According to industry watchers, they would be approved more quickly in the short-term if Trump won and the SEC had new leadership.
Dare I say: What can go wrong?
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