BTC Sessions - NEWS ROUNDUP: Crypto Holders Bleeding Bitcoin ep264

Episode Date: June 16, 2022

Looking at the (poor) performance of altcoins vs Bitcoin from cycle to cycle, chaos in global macro, Terra contagion hits other firms and much more on today's show. 💪 SUPPORT THE SHOW: Shakepay is the easiest way to buy Bitcoin in Canada Sign up now and get $30 free after your first $100 purchase! https://shakepay.me/r/BTCSESSIONS ALSO search/subscribe to Shakepay on YouTube! LEDN Bitcoin backed loans –  get $10 free with a savings balance of $75 or more for 15 consecutive days! https://start.ledn.io/btcsessions Keystone Wallet: secure your Bitcoin! http://bit.ly/KeyStoneSessions BillFodl: get your wallet backups in solid steel. https://privacypros.io/btcsessions Bitrefill: use Bitcoin to purchase gift cards https://www.bitrefill.com/buy/?code=O04UMic9 Like what you see? BITCOIN TIPS: https://strike.me/btcsessions

What is going on, everybody? Welcome to this show. We've got plenty to talk about today, whether it be Bitcoin versus alt coins, the predictability of them getting crushed versus Bitcoin as the cycle rounds the corner. We're going to talk a little bit about some global macro stuff. We're going to talk a little bit about the quote-unquote crypto contagion from Terra Luna imploding and the Celsius debacle and everything else that's going on. and how that's impacting a lot of things. Of course, this is live. Anything can happen. So I defer to my friend Bill here. We'll do it live. Okay.

We'll do it live. Do it live. I'll write it and we'll do it live. The thing sucks. If you have not already, like, subscribe, share. All those things really do help. And thank you to those of you that have been doing them regularly. I am Ben with the BTC sessions.

This is your daily session. Before we dive in, let's take a look at where we are in the markets right now. We're sitting at $20,430-some-odd dollars. Could we see sub-20K Bitcoin coming up? Very possible. We're pretty close. We're pretty close there. Cheap sats, though.

Speaking of which, a single U.S. dollar can pick you up. 4,898 sats getting pretty close to that 5,000 sat per dollar level. So keep an eye out for that. 90.81% of all Bitcoin have been mined. And in terms of fees, a little bit of a push right now, next block looking like 20 sats per byte. But if you're willing to wait just a little bit, one sat per bite should be okay,

although that may be a sudden influx. So you might want to set it to a few sats per byte. if you're in a rush or used replaced by fee. Shout out to sponsors of the show, shakepay.com. If you're in Canada, a super easy way to stack sats. You can fund your account with e-transfers in and out. No deposit or withdrawal fees, by the way. After you purchase your first $100 worth of Bitcoin using the link down below,

they'll give you $30 for free. You get the exact same deal when you refer friends and family through your link. And you can also shake your phone every single day for $3. free sats. They've also got a sats back Visa card. Plenty of ways to stack sats. So be sure to check them out in a link down below. Next, we have ledden.io. Love these guys. Lifesaver, whenever you're in a pinch and you don't want to sell your

Bitcoin, but you need some dollars. You can always deposit Bitcoin here, get a loan of dollars to your bank account within 24 hours. When you pay back those dollars, you get back the same amount of Bitcoin. Of course, they do have savings accounts for Bitcoin and USDC. if you're looking for a little bit of interest, they're for the B2X offering, if you're feeling a little bullish with these low price levels.

And beyond that, they are starting to roll out Bitcoin-backed mortgages first across Canada and then to some select US states. So if you want to check that out, head over to start. Letton.io slash BTC sessions. On next way of bit refill.com, super easy way to help you live on Bitcoin

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they are rolling out bill payments so you can pay your everyday bills with Bitcoin. So be sure to check them out, bit refill.com. Keystone, one of my most used hardware wallets. It is 100% air-gapped, meaning you never plug it into anything internet-connected. Everything is done offline via Q1. code, it just keeps the keys to your money safe and away from internet connection.

Definitely upgrade to the Bitcoin-only firmware. It works beautifully with things like Blue Wallet, Sparrow, Specter, awesome and a multi-sig. Links are down below. And I also do have a full tutorial on how to use the thing. So check that out. And finally, if you are backing up any important Bitcoin wallet, be sure to get it in solid steel with the bill foddle over at privacyprose.io. steel is just a much more secure way to store your seed phrase, your backups to your Bitcoin,

because paper just doesn't cut it, fire damage, water damage. I've heard of people discarding it because it's just a piece of paper sitting around the office. So get yourself that piece of mind with Bill Fottle. This is how I'm backing up all of my seed phrases. So be sure to check them out. And with that, let's dive into the news. I wanted to highlight, given kind of where we are in the market, obviously getting into a bit of a bear market here.

I wanted to highlight this article dropped a couple days ago by Sam Callahan over at Swan Bitcoin. And it's called Bitcoin and the one hit wonder altcoins. And he goes through basically detailing what historically has happened and seems to be repeating itself with all coins from basically from cycle to cycle. whenever an alt coin drops, it tends to perhaps initially hit an all-time high against Bitcoin. So how many sats is that all-kind worth at some point in its first cycle? It tends to hit an all-time high and then never reattain it moving forward in the subsequent cycles. Now, there are exceptions to the rule, but as of yet, there hasn't been a single alt-coin that has reattained new all-time high more than a second time.

So let's take a look at what we mean here. So he says, bear markets have a way of separating the cream from the crop. And he has a warm Buffett quote here. When the tide goes out, you see who is swimming naked. He says, this phrase has never been more true than it is today. When it comes to the broader cryptocurrency industry, everything was going great for alt coins when liquidity was flowing like water due to the ultra low borrowing costs and stimulus checks, causing speculation to run rampant.

It's easy to sell a narrative in good times, but it's not so easy in hard times. Now the Federal Reserve is starting tightening, so on and so forth. And it basically goes on and he says, no matter how fervent a believer in a project or token, people tend to question their investment decisions when they see a bright red number, staring back at them of negative 70, 80 or 90%. So he goes on and he says, for this analysis, we'll be looking close. closely at how the top 20 coins by market cap and each major Bitcoin bull cycle have performed against Bitcoin in the following cycle.

There are three major bull cycles that have occurred so far in Bitcoin's history. These are from 2011 to 2013. Bitcoin ran up 56,700 percent from around $2 to $1,100 at a peak. Number two would be 2016 and 2017. Bitcoin ran up 8,595% from $1,000 to $1,500 at peak. around $230 to $200,000 at its peak. And then 2020 and 2021, Bitcoin ran up 1,625% from around $4,000 to $69,000 at its peak. And you can see those runs on the chart here if you're watching as opposed to listening.

All right. He said for this piece, I obtained historical snapshots of the top 20 all coins each week when Bitcoin made its cycle all time high. I analyzed when the top 20 alt coins each made their all time high exchange rate against Bitcoin. I then revisited these same coins in the next bull cycle and looked at the highest exchange rate they made against Bitcoin in the subsequent cycle. Because I decided to use the highest exchange rate these altcoins made against Bitcoin in each cycle, you can consider this analysis as being generous to alt coins due to their low liquidity. Many altcoins briefly made higher Bitcoin exchange rates and subsequent cycles when being pumped with low trading volume,

only to significantly fall lower when priced against Bitcoin. Keep this in mind as we dig further into the data. So he goes into the 2013 cycle, the peak at a little over $1,100 coin, and he snapshoted the top 20 coins. So many of these all coins gain popularity for a brief moment, then slowly faded into obscurity. after making an all-time high against Bitcoin in 2013, here's how the top 20 altcoins of 2013 performed against Bitcoin in the next bull cycle.

You can see there were two that in the subsequent bull cycle did better against Bitcoin. One was XRP, which was over 100% higher. So basically double its previous all-time high versus Bitcoin. And one was infinite coin, which made double digits. So it says the majority of alt coins in the top 20 never made another all time high against Bitcoin. Again, the average return against Bitcoin for these coins after making an all time high was negative 73.1% during the 2017 bull run. Only two of the top 20 in this time period made an all time high against Bitcoin.

That was XRP and infinite coin. Now, Infinite coin briefly made an all-time high against Bitcoin in 2017 when the illiquid coin randomly had a spike in trading volume on one single day. After that, Pump and Dump Infinite Coin went back down to negative 93.6% against Bitcoin since its first made all-time high in 2013. XRP was the only one from that bull cycle to make a subsequent Bitcoin all-time high in 2017. It found its second wind after the... Ripple, it's, Ripple is XRP. It's the same fucking thing. They, they changed it up and tried to basically say that it was separate from the Ripple

parent company because of the SEC. But anyways, I found a second wind when it made a round of false announcements about partnerships with global banks. Today, the corporation that runs at Ripple Labs and its top executives are being charged by the SEC for conducting an unregistered securities offering and the XRP token has been delisted from all American exchanges, living Americans who held it in the unfortunate position to sell up prices 80 to 90% down from its all-time highs against Bitcoin. Okay, let's move on to the next cycle, 2017 to 2021.

Next bull cycle in 2017 saw Bitcoin soared at $20,000 a coin, basically where it's right now after like we dove into our bear market. So we're basically at the all-time high of the previous cycle. Okay. And people are freaking out. So the all coins of this cycle market themselves as better options than Bitcoin because they were quote unquote faster, had things like smart contracts and so forth. So here's how all 20, all 20 of the top 20 coins versus Bitcoin fared from 2017 to 2021. That's a lot of red, my friends, double digit red. So this graph highlights how every single top 20 all-coin of 2017 has underperformed Bitcoin since making a Bitcoin all-time high back in 2017.

So the average drawdown of these alt-coins against Bitcoin since making their Bitcoin all-time high is negative 78.2% during the 2021 bull run. Now, not one of these alt coins made a new all-time high. This includes blue chip alt coins like Ethereum. Notice how XRP failed to replicate its magic from the 2013 to 2017 bull cycle. It's down 82.9% against Bitcoin since making its Bitcoin all-time high in 2017. Although it was able to achieve the second rare Bitcoin all-time high from 2013 to 2017, it's woefully underperformed it since then. 99% of these altcoins underperform Bitcoin from cycle to cycle, but there are always outliers given a data set.

After analyzing all the altcoins in the top 100 from 2017, he could find only two cryptocurrencies that went in to make another Bitcoin all-time high in the subsequent bull market, Dogecoin and Binance coin. Dogecoin became a meme in the spring of 2021. Celebrities, influencers, entrepreneurs like Elon Musk, Mark Cuban started promoting it. to retail investors. As a result, it spiked against Bitcoin to an all-time high in May. Since it's Bitcoin all-time high, Dogecoin has gone the way of most all-coins. It is currently down negative 77.1% against Bitcoin. Those retail investors would have been better off simply holding Bitcoin.

Binance coin was another cryptocurrency to make an all-time high in 2017. And again in 2021, it benefited from the rapid adoption of the broader centralized Binance smart chain ecosystem, along with being a centralized token of one of the largest cryptocurrency exchanges in the world. This helped pump the price of the token to new Bitcoin all-time highs. However, Binance is now under an investigation from the SEC for potentially BNB being an unregistered security. Since making its all-time high in the spring of May 2021, BNB is now down 15.2% against

Bitcoin, like XRP, we'll have to see if it again. is unable to reattain that trend. All right. And so what's next? Similar to the one in 2017, the 2020 and 2021 Bull Run came along. Many of the popular 2017 altcoins were completely forgotten as new trendy alt coins replaced them.

So let's see. 2021 to today. So all-time highs last year versus Bitcoin. What's happened since then? here's how the top 20 all coins of 2021 are performing against Bitcoin since making their Bitcoin all-time highs in the midst of the recent full cycle. A lot of red. Binance coin has performed the best, Ethereum, the second best, Shiba Inu, the third best.

And when I'm saying third best, it's still down over 50% versus Bitcoin. Ethereum down over 25% versus Bitcoin, Binance coin down 15 or whatever percent it was. The average drawdown since Bitcoin all-time highs in the recent bull run is 68.5%. Probably more to come. Yeah, he says, I expect like in previous altcoin cycles, many of the altcoin darlings of 2021 will be completely forgotten in the next bull cycle when it begins. So he says there's two major takeaways from this analysis.

Only Bitcoin has proven to have any kind of staying power when it comes to holding its value over multiple bull cycles. And during each Bitcoin bull cycle, the new crop of all coins emerges, but they always end in the same bloodbath when priced against Bitcoin over the long term. Yeah, basically, again, like the chances of you having accurately picked the one that would, have a second all-time high versus Bitcoin in a subsequent cycle was absolutely infinitesimal. And on top of that, it would not go on so far to reattain a new all-time high versus Bitcoin in a third cycle. So, yeah, like the meme thing with Dogecoin just happened to be a meme that happened, right? Like, that was total flu.

And since then, it's completely died. as as memes do, right? And then beyond that, the B&B thing, again, there were certain market factors at play that that helped it along with that. But again, continuing to drop from there, Ethereum has not reattained its all-time high versus Bitcoin. And it's the number two alt-coin out there and they keep on screaming, flippening. This cycle, just for context, Ethereum spiked to its all-time high versus Bitcoin in 2017. It was around 15% of a coin or 0.15 Bitcoin per ETH. In this past cycle, it topped out at 8% of a Bitcoin, 0.08.

So about half of its previous all-time high versus Bitcoin was all it could eke out this cycle. I think a lot of this is going to end up looking like the light coin chart, which is basically what Ethereum has done so far and I think it will continue to do. Basically, each cycle, light coin hit around half of its previous all-time high versus Bitcoin and it's had a few of them.

So it's just gotten chopped in half every single time. I would be surprised I wouldn't be surprised to see again Ethereum in a subsequent cycle down the road hitting all-time highs versus Bitcoin

for that cycle. being around 4% instead, again, like getting it chopped in half and then 2% and then 1%. Like I think it's just going to be a volatile path to having less Bitcoin. But we'll see. Anyway, shout it to Sam Callahan for this article. I spent a bunch of time on it here because I think it's important. Anyways, let's move on. Jurian Timmer, this is the director of Global Macro at Fidelity.

He tweeted out a few threads here. He said, is Bitcoin cheaper than it looks? If we consider a simple P.E metric with Bitcoin to the price versus network ratio, then that ratio is back to 2017 and 2013 levels, even though Bitcoin itself is only back to late 2020 levels. Valuation often is more important than price. He says another way to highlight this is by overlaying Bitcoin's non-zero addresses against its price. price is now below the network curve. The next chart shows how technically oversold Bitcoin is. Glass knows dormancy flow indicator is now to levels not seen since 2011.

So basically the director of global macro at Fidelity more or less thinks that Bitcoin is massively underpriced right now. Could the price go lower than it is right now, obviously? But that said, he seems to be. be indicating that it looks pretty attractive, especially over the long term and that the price right now is not reflective of the continued build and value of the network. Let's move on here. Let's talk some macro stuff. So from Bitcoin Magazine here, Federal Open Markets Committee or the FOMC raised its target rate.

The Federal Reserve raised its target interest rates by 75 basis points on Wednesday. That's the largest interest rate hike since 1994. The raise came in line with market expectations that foresaw a more hawkish committee in action as latest inflation figures came in above expectations, marking a new 40-year high at 8.6% with the CPI, which we all know is bullshit. Anyways, FMC chair Jerome Powell, who also serves as chair of the Federal Reserve, said in the meeting beginning of May that the committee would enact a 50 basis point raise in June had market data such as the Consumer Price Index come as expected.

Powell explained the reasoning behind the change in course in a press conference head following the monetary policy decision. He said on Wednesday he said that leaning on inflation, which he had expected or said again surprised to the upside. Over the coming months, we'll be looking for evidence that inflation has been turning down. Hikes will continue to depend on the incoming data, but either 50 or 75 basis points increase seem more likely in the next meeting. Powell highlighted once again that the main goal of the Fed is to bring down inflation to its 2% target.

Notably, the community's latest statement removed a line from the power. statement that read, with appropriate firming in the stance of monetary policy, the committee expects inflation to return to its 2% objective and the labor market to remain strong. The FOMC appended a line to that paragraph that stated it is strongly committed to curbing inflation to the target rate. So basically, before they're like, yeah, we'll stop inflation. Now they're like, we're really going to try to stop inflation. The committee also released a new summary

of economic projections, a document that puts together the analysis and forecasts of all FOMC members for gross domestic product or GDP growth, unemployment rate, and inflation for this year and the next two. Participants now expect interest rates to reach

3.4% by the end of the year and 3.8% by the end of 23 before decreasing in the following years. So they're basically saying that they're going to hike rates all the way up to damn near 4% in the next couple of years. And they're already saying, and then after that, we're going to start cutting rates. So they're trying to like project out and say they're going to come back down again to

historic lows. But what is, what's the effect of all of this right now? Well, we're already seeing articles like out of things like Bloomberg. central banks got it wrong. And so they say central banks won multiple plotts for being the only game in town when crises hit in the wake of the financial crisis of 2008 and the pandemic of 2020. There were the fastest to erect defenses around their economies. So it will prove a shock that many now blame them for being more a problem than a solution as soaring inflation proves the greatest challenge to global economic outlook. The result is a scramble to catch. up. Today alone, the Federal Reserve is forecast by most to raise interest rates, which we just saw that they did. The European Central Bank is holding an emergency meeting to discuss the recent sell-off in government bonds in weak economies, which we also found out they're going

to more or less try and print their way out of that. And the Bank of Japan is struggling to fend off an attack on its policies in bond markets. We're going to touch on that in a second. So the stock market is reacting to this. U.S. stock sank Thursday as investors weighed the potential economic cost of the Federal Reserve's ongoing fight with inflation. This from Yahoo Finance. SMP fell by 3.25 percent to its lowest level since December 2020.

It also erased gains after rising on Wednesday. Funny enough, things really. rose on Wednesday after the interest rate announcement. Nasdaq plunged by more than 4%, bringing the index down by more than 30% year to date. The Dow sank by 741 points or 2.4% to close below 30,000 for the first time since January of 2021. Stocks, which moved initially to the upside following Fed's rate hike on Wednesday, turned around as traders assessed the potential that central banks, moves to bring down inflation would trigger a deeper downturn in economic activity. And how is this affecting individual people?

Well, let's talk mortgage rates in the U.S. They have gone up a lot. So in January of 2021, this is from Charlie, Charlie Belello. In January of 2021, the 30-year mortgage rate was 2.65 percent, an average new home price in the U.S. was $401,000. Today, the 30-year mortgage rate is 5.78% and average new home price is $570,000. Assuming a 20% down payment, that's a 106% increase in the monthly payment. It would have gone for the same home from $1,294 to $2,671. So if somebody was they could have afforded a home in the conditions of January of last year and been able to afford that almost $1,300 monthly payment.

They're basically, and they were saving up, and they finally hit that number, they saved up for that 20% down payment. Well, guess what? A year and a half later, you're basically not even halfway there to your goal. Yeah, you're pretty much screwed at this point. which is super sad. It's really unfortunate. Let's talk about that Japan thing that I mentioned. And this is very interesting in that they relate it to the way that Terra, which collapsed earlier, and we'll get into that, was trying to defend the peg to its stable coin.

And so what happened with Terra is they had a stable coin that was supposed to be pegged to the U.S. dollar and they were backing it with Bitcoin. They said they had reserves of Bitcoin and that they would defend the peg with that if people started selling off this stable coin. Well, the problem is when you know how somebody is going to defend the peg, you can basically short that thing and then start trying to sell. sell the peg. And that's what happened. So they basically ended up having to try and defend the peg by printing more terra, the token. And they had to sell off all their Bitcoin.

And somebody basically shorted those two things and then started dumping this stable coin. And so they knew that the prices of those two things would have to drop in order to defend that peg. And look what happened. The whole thing imploded. Well, the Bank of Japan basically is trying to do the same thing. with their bonds. They don't want the interest rate of government bonds to go up. So the pegging

question is the Bank of Japan's self-imposed ceiling on the benchmark 10-year government bond that restricts yield investors to earn no more, no more than 0.25%. This helps pin down borrowing costs across the broader economy and support growth. So basically, they want cheap money for all so people can keep borrowing a ton of money and be able to spend in the economy. They want the government to be able to sell off bonds and get money for cheap and be able to spend on stuff. However, if a lot of people are dumping bonds, right? If a lot of people are selling government bonds, that means that the market, when there's a whole bunch of supply and not a lot of demand, that means that the percent interest that needs to be offered to entice people to buy those bonds

needs to go up. So what they said, the Bank of Japan basically said, we don't want that number to go up because we don't want to have to pay more interest. So we will print as much Japanese yen as possible to make sure that we always buy up any bonds that are being sold on the market. And so people are calling them on that. They're basically saying, all right, let's see your hand. We're going to dump all these Japanese bonds and try and force you to print more money

and probably in the process short the Japanese yen. So it goes on to say, should bond vigilantes dump their holdings overboard in the sign of their dwindling faith, the Bank of Japan steps in to the void to buy up excess supply with freshly created yen. Okay, so this is called yield curve control. Now, they're between a rock and a hard place. So while the foundation behind Terra burned through almost its entire reserves of Bitcoin and failed in a failed attempt to prop up its fixed exchange ratio, the Bank of Japan can in theory print unlimited amounts of money to cap yields on government debt.

Now, it appears speculators are set to test its resolve, much in the same way they attacked TerraUSD, eventually. sending South Korean creator Doquan stable coin into a death spiral. The bond market appears to be pricing in the chance of a collapse and yield curve control. And this is somebody from Morgan Stanley Securities. And so it's pretty interesting because it, so the, first of all, the Japanese yen has, has completely tanked versus USD. but also the MMT experiment that they just were playing of pretty much buying all the bonds, it got destroyed today because it was supposed to,

the yield on those bonds was supposed to stay at 0.25%. Well, it's almost doubled. And this was like this morning, it went from 0.25% to 0.45% over the course of two hours. And beyond that, the Japanese yen has lost 24, of its value against the U.S. dollar in the last three months alone since implementing a lot of these policies. So not only are they not getting the effect they want on trying to keep the yield on bonds low, they're destroying their currency in the process. They're basically saying we

will provide unlimited inflation to prevent these yields from going up and it still didn't work. Not good. Shit's breaking. Now there's an issue with that because because Japan could try another thing. They hold a ton, a ton of U.S. treasuries, and they could start dumping those rather than dumping and printing their own currency. So that's a very real possibility, in which case we would also see problems in the U.S. bond market. So this contagion could extend out a little bit. Anyways, let's keep going.

Let's get into bullshit happening in crypto now. So Corey Clifston has been on an absolute tear first on the whole Terra thing, but now with Celsius, Celsius, I guess, being exposed to, I mean, greater market conditions as a whole, but, you know, the Terra UST thing didn't help them any either. and again, effectively, they froze withdrawals. If you have loans or obligations on the platform and you even have enough money in your Celsius wallet in order to pay it, you're not allowed to use your existing balance to pay off those loans. You have to deposit more to pay those loans, denoting that they don't have enough fucking money to settle up. So there's major issues there. But anyways, great quote from Corey here.

What you actually are as a Celsius user is an unsecured lender. This whole idea of banks are evil. Then they become, then they go become a worst bank is the headline story with Celsius. Well, all of this Celsius stuff and this Terra stuff has begun to reach out into other firms like 3AC. So three arrows capital, a considerable amount of gossip about the status of crypto, hedge fund 3AC has been off the record or from anonymous Twitter commentators. Yesterday, co-founder Zuzu tweeted, quote, we are in the process of communicating with relevant parties and fully committed to working this out without explanation.

One of its business partners, eight blocks capital, a step forward alleging that 3A used almost $1 million of its funds without authorization. MIT and Cambridge educated Danny Yuan, the CEO, of market maker A Block's capital isn't a high profile crypto personality, nor is this firm. 20 months ago, they did a deal with 3AC, allowing it to use 3AC trading accounts. This is because 3AC is such a big player in the market, and they get preferential trading fees. Yuan said on Twitter, our agreement with them was, we withdraw whenever we want. 100% of the P&L belongs to us.

They are never to move our funds without permission. And in return, we pay them fees for their service. However, he claims that in recent days, 3AC used around 1 million of 8 blocks funds to meet margin calls and said, they still have assets on a number of platforms. You know who you are. We call for you to freeze their assets so that those who 3ACOs can be paid back. in future after legal proceedings. And we just saw recently that they have not been able to meet some of their obligations,

3AC. Beyond that, we're seeing that ripple out into other firms, FinBlocks, important update from them to our valued customers. We have been closely monitoring market conditions and numerous media reports regarding a prominent institutional borrower, Three Aeros Capital,

who is also an investor in FinBlock's. We have been cooperating with over eight partners and protocols, including 3AC, to generate yields and spread the risk. We can generate yields as evenly as possible. Based on currently available information and our priority to maintain the integrity of the platform, we have decided to take the following actions while pursuing all available options to evaluate the effect of 3AC on the liquidity and ensure fair treatment of all user assets on the system.

They're going to pause reward distributions. They're going to change the withdrawal limits, 500 USD equivalent per day, up to a maximum of 1,500 per month. Holy shit, for all levels of users. God. Delay referral program and deposit rewards. Disable creation of crypto addresses for newly registered users. Well, at least they won't be allowing people to deposit more. This set of actions is a necessary move in such a highly volatile market.

and we believe should help us and our community manage the effect. Beyond that, let's keep this shit going. Deribit, we can confirm that Three Arrow's Capital is a shareholder of our parent company since February 2020. Due to market developments, Deribit has a small number of accounts that have a net debt to us that we consider as potentially distressed. Even in the event that none of this debt is repaid to us, we will remain financially healthy and our operations will not be impacted. Well, hopefully, yeah. But holy shit Like one thing hits

And these These fucking degenerates are so levered up across the board So many people got so insane with all of this shit And now it's getting institutional And people think that they can just They think they can just Fiat bank like they used to Right? They think that you can just

At the end of the day be like Oh yeah we'll lever this up lever this up up, we'll just print more. But there's no fucking bailouts when you're dealing with a hard base asset, which is Bitcoin. There's no bailouts in that shit. You can't go and just call on the central bank of Bitcoin to print you off some more. There's real repercussions. And I mean, the regulators, they don't get, they're not going to bail out these assholes, not a chance.

And so what you see is the free market working as it should, where if, if you're, If people take disproportionate risk and they don't hedge their bets, they're going to get fucked. And unfortunately, this is going to be a hard lesson for a lot of newbies that came in in the past year thinking, wow, this is a good regulated exchange. This is a good custodian. This is whatever. Not your keys, not your coins, motherfuckers. This is the price of tuition. You've got to figure this stuff out.

And if you got hit hard, I'm so sorry to hear that. that, but you need to take this as a very important lesson that unless absolutely necessary, unless you're doing something important, there's something. And even in those instances, you need to make sure that is that risk worth it for you. You need to make careful considerations. But for you to be parking all of your Bitcoin in a custodian, when it's the most pristine asset the world has ever known the hardest money the world has ever known you're taking a massive risk if you're parking all of your net worth in in custodians you got to be careful with this stuff guys if you've been hit i'm sorry take it as a life lesson you're still the majority of the world

still doesn't understand bitcoin it's going to hurt but you got to start to rebuild and you've got to start to learn self-custody. You have to. It's absolutely imperative. And this is definitely not done. There's going to be more pain. So look at this market as the free market doing what it should. And just look at it as an opportunity to stack more sats.

Well, people are still confused and don't understand that Bitcoin is not crypto. Fiat One person can print money Crypto Everyone can print money Bitcoin No one can print money There's your lesson

Learn some self-custasy Sorry if you got shanked Speaking of some other Bullshit What's his name? Mark Andresen Is still pumping like web three crap uh uh shout out to learon shapira for taking this uh clip but basically it's it's uh and

andreason explaining to tyler cohen a web three use case and this guy tyler cohen does not seem super convinced i don't blame them um and basically in this whole clip he more or less just explains the idea of like micro transactions for podcasts and the guys like I don't I don't understand why the web three part of this is necessary like don't we have the infrastructure to facilitate this already yes we fucking do I'm already doing it you might even be listening to this right now on a platform like fountain or breeze or whatever it may be and you might be actively streaming me sats per minute directly to my own lightning node. I've even done a tutorial on it.

You don't need Web 3 tokens and all this trash to do it. It's already here if you want to do it. I don't know what more to say. Yeah, this spare market is deserved. It's deserved. Stack those sads. Dump your trash. Learn your lesson.

If you want to check out that podcasting 2.0 tutorial I did, just search it up on the channel. But anyways, podcasting 2.0, streamsats to pods via Breeze or Fountain app is another good one. I've done videos on a bunch of them. But I basically, this one video here, I do a tutorial of how to set it up. If you're a podcaster, there's other videos of how to utilize those platforms to stream sats to your favorite content creators if you see fit. Moving on, speaking of things that will be possible without the need for additional bullshit. Now, there's been some pushback on something called taro, which is basically more or less, it could enable shit coins on top of lightning network. Not super stoked about that.

However, in the interim, I could see how stable coins would be useful on lightning for people in developing nations that just don't have access to banking. Maybe the volatility of Bitcoin is a little tough for them to deal with, but they'd like something that's stable on a U.S. dollar basis, but they don't have the ability to have a bank account, so and so forth. So this is kind of outlining what could be built upon tarot in regards to regular day-to-day currencies. And the value here I could see is that people can use it in the interim, but then as they decide that, their local currencies or even the US dollar is no longer working for them and they don't want to store their value in it. They're already using Bitcoin and it's literally just flicking a switch and saying how you want to receive your value. So anyways, this from Leo Wes or Weiss rather, this little thread on how Terrell could work. Terrell strengthens the Lightning Network

will also solving the problems that billions of people, especially the underbanked, face today. Let me explain. In the Terra future, community banks are going to credit depositors with their own stable coins, leveraging locally built trust and distribution. So this is the centralized part of it. Any fiat currency is going to be issued in a centralized way. There's going to be a degree of trust in that there's actually a dollar backing a stable coin. That's really the only way you can do it.

The algorithmic ones, as we've just seen with Terra, any sort of like peg defense, it's just going to end in misery. So you basically have to have some degree of trust there. Comes with the territory in Fiat land, right? Anyways, clients can trade these deposits peer-to-peer for cash, goods, and Bitcoin. But most importantly, pay any lightning invoice from anywhere in the world with their local balance. It works the other way around too.

You can use any popular tarot-enabled lightning wallet to receive either non-custodial sats or fiat without the payer side knowing who can themselves pay with Bitcoin or a different stable coin. Imagine what this means for community banks worldwide, which are now much easier to found and instantly connect to a global network of potential buyers and sellers permissionless through open source software. And these banks aren't limited to their local currency. Tero is able to do this in a scalable way. by piggybacking on on-chain transactions that would have been made anyways without compromising on auditability and custody.

So pretty interesting. I guess we'll see how that develops in the future. But again, I see it as like an interim measure. Like people are going, I think, let's say in a world where everybody's using this as a mechanism to transfer value, first, I think the poorly man, the most. most poorly managed fiat currencies on earth are the ones that are going to get hurt the most. And that might that would probably benefit the US dollar in the interim. But eventually as the US dollar gets printed into oblivion, which it will over time,

people will realize that long term it makes more sense saving in Bitcoin. So maybe there'll be a period of time where people have their day to day value for bills in dollars and then their savings in Bitcoin. and then eventually I could see that shifting where the pace at which the U.S. dollar gets debased either somehow they stop that from happening or it just all flows into Bitcoin and people stop using the dollar. So we'll see. In other shit coin news, Uganda has announced that it struck a deposit of 31 million tons of gold or with an extractable pure gold, extractable pure gold,

estimated to gross 320,000 tons. So what the hell does this mean? Basically, Uganda has announced that they found a massive amount of gold. Now, the important part here is in relation to Bitcoin, like, how much supply is this? We know that almost 91% of all Bitcoin have been mined. It's going to take the next 120 years for the remaining 90 or the rest. remaining 9% to be mined. And most of that's going to happen in the next 10 years. Now, what kind of stockpile of gold is this in relation to how much gold currently exists?

So again, estimated 320,000 tons of pure gold that could be extracted from this. well, the existing stockpile of all discovered gold in the world up until the other day, above ground stocks was 201,000 tons. And total identified underground reserves that is extractable, 53,000. So a total of around 254,000 tons. And Uganda just found that and more. So basically the existing stockpile of gold on Earth just doubled. Just doubled over the past couple of days.

Imagine if tomorrow Bitcoin was like, yo, you know how it was 21 million? Turns out it's actually like 45 million. Sorry, but you know, cool because one place is going to get it. Holy shit. Yeah, this is something that can't happen to Bitcoin. Wow. Okay, let's wrap it up here. Monday, I dropped a video on the Blockstream Jade,

which is a mobile Bitcoin Harbor wallet. You can use it with your computer as well. You can use it with Bloxstream Green. You can also use it with Spectre wallet. But I said in the video that you couldn't use it with anything else yet. That was incorrect because Sparrow wallet, the absolute gems that they are. Craig Raw is a legend has added support for Jade Wallet, so you can use it with Sparrow as well. Cool. I basically walk through how to use it just with

Bitcoin. You can use liquid with it. I've done a video on that before, but I just focused on the Bitcoin aspect of it because it's so cheaply priced. It's like 45 bucks for one of these things. Overall impression, you know, when it works, it's great. It's gotten a lot better since I initially got it. I'd like them to work out some of the kinks that I encountered. The Bluetooth connectivity was a bit of a pain in the ass for me. Like once it powers back down, the initial connection was fine.

But like when the thing shuts off, you basically have to forget the device and turn everything off and shut down blocks from green and then repair from scratch. I've heard that's been fixed on iOS. Somebody told me that their Apple phone, it's a lot better. archiving accounts and stuff like that tend to reappear. So there's just a few annoying bugs that needs to be fixed.

When those are fixed, I think it'll be a pretty good deal. I just haven't seen as much progress as I like to see on this thing yet, but I will revisit it again in the future. And hopefully those things will be rectified. I'd also like to see them finally enable the software to use the little camera on the back because then that could open up things like air gaping. But nonetheless, if you want to check out that video and see how the thing looks, go ahead and take a look.

And also tomorrow, be sure to join me for Why Are We Bullish. I'm going to have Bruce Fenton. I'm going to have Len from the Canadian Bikorner's podcast. We're going to have the most frequent visiting guest of all time on Why Are We Bullish, Guy Swam. And that's a good thing. I'm super glad that he's coming along. for the ride yet again always welcome on the show so make sure you hit that up we'll be on 6 p.m.

Eastern time tomorrow with that we're going to wrap it up thank you guys so much for watching and or listening please do like subscribe share all those things I got to say it super important and I'll keep at it leave some love down in the comments if you can let me know what you thought about the show any of the topics that we discussed comment down below I'm going to start trying to poke at that because I'd love to see some more comments from you guys and thoughts on what you think about the show. If you'd like to help us show in another way, you can hit up the sponsors down below,

shake pay, lead, bit refill, keystone, bill fottle. And if you really liked what you saw, you can hit me up with a Bitcoin tip at my strike page, strike.me slash BTC sessions, get there, type in any amount you like, hit the tip button. You will see a Bitcoin or, sorry, a lightning invoice. If you tap the arrow to the right, a regular Bitcoin QR code.

With that, I'm out. Have yourselves a wonderful day or evening. See you guys next time for your. your daily session.