The Pomp Podcast - #1010 Here Is Proof That Bitcoin Is Very Cheap - BTC On-Chain Analytics

Starting point is 00:00:00 what's up everyone this is anthony pompliano most of you know me as pomp you're listening to the pomp podcast simply the best podcast out there now let's kick this thing off in today's episode will clemente couldn't join me for our weekly sit down so instead i just break down all of the charts that he put together i hope that you enjoy this and please bear with me as obviously i'm nowhere near as astute in these metrics as will but i'm doing my best to keep up so before we get into this episode though, I want to quickly talk about our sponsors. This episode is brought to you by BCB Group. With a dedicated focus on institutional payment services, BCB Group provides business banking, cryptocurrency, and foreign exchange market liquidity for many of the world's

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Starting point is 00:03:13 Again, pipe.com slash pomp to start trading today. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. What's up, guys? Bang, bang. These five to six minute updates every Saturday get you took the speed on exactly what happened in the Bitcoin market.

Starting point is 00:03:48 And boy, was this a wild one. All right, let's get into this week's update. To get started, we can see that Bitcoin's trading just above $20,000, about $20,500. We can see that the market cap has drawn all the way down and is now below $400 billion. Now remember, Bitcoin's inflation rate is still sitting at about 1.7%, and more than 90% of the supply has been issued.

Starting point is 00:04:08 We also can see that the real exchange volume over the last 24 hours is $4.56 billion, dollars and miners have been paid 18.7 million dollars over the last 24 hours to continue to secure the most secure computing network in the world gbtc premium has widened all the way to 35 percent and of course we have seen that bitcoin is down 70 percent from its last all-time high if we then go and we compare bitcoin gold and the s&p 500 we see that bitcoin over a one-year period is down 43 percent the s&p 500 down 13 and gold is up four percent but if you look over any other time period, two to 10 years, Bitcoin continues to dominate gold and the S&P 500.

Starting point is 00:04:48 Next up, we can look at the price closing history by each individual level. Bitcoin has spent only 539 days ever in its life above the current $20,500 price point. That's about 10.9%. And so if you had bought Bitcoin 89% of the time and held until today, you would be in profit. If we then go and compare Bitcoin, gold, S&P 500, NASDAQ, and TLT, we see that Bitcoin continues to compound annual growth over the last decade at 123%. And the five-year sharp ratio is absolutely dominant compared to the other assets. Next, we can switch over. We can take a look at the Blockware Intelligence Update. This is Will Clemente and the team over at Blockware. They do a fantastic job. First, we can go ahead and take a look that Bitcoin continues to experience

Starting point is 00:05:31 one of its furthest deviations below a 200-day trend in history. It's also the third lowest in the last 10 years. Bitcoin also happens to sit below its four-year trend for just the third time ever, according to Blockware. These previous occurrences took place at the bottom of the 2015 bear market and during the March 2020 liquidity crisis that was related to COVID-19. Of course, Bitcoin sits below its 200 weekly moving average for only the second time ever with the previous occurrence during that March 2020 liquidity crisis. And then in a really interesting chart that we haven't talked about in a long time, you can see that Bitcoin's price since it's the lower bound of its production cost

Starting point is 00:06:07 for the first time since the March 2020 liquidity crisis. The idea here is that Bitcoin should, at a minimum, be worth the cost of energy to produce it. It's a fantastic insight coming from Will and the team over there. Now, Bitcoin's market price finally sits below its realized price, as you can see here with the MVRV Z-score sitting right there in that green area. Then, of course, the reserve risk,

Starting point is 00:06:27 which was created by Hans from Ikigai, you can see that that also is one of the lowest readings in history. Then if we switch and take a look at the derivatives, the block routine all over it, there's a large decline, about three-month futures basis across the board. And then, of course, if we switch and we take a look, there's over $10 billion. Futures open interest in USD has reached its lowest since December 2020. And then we've started to see some negative funding rates across the board at all venues, but would like to carve out a much longer regime, according to Will and the team.

Starting point is 00:06:57 Lastly, the options implied volatility that has driven dramatically upwards as active managers and market makers seek to hedge their positions. That now is just shy of the levels reached in mid-May 2021. Now remember, just because all these metrics are flashing, saying that Bitcoin is much, much cheaper than it's historically been,

Starting point is 00:07:16 doesn't exactly mean that this is the bottom. Nobody has a crystal ball. We are operating within a very bearish macro environment. The Federal Reserve continues to hike interest rates and conduct quantitative tightening. And that means that Bitcoin, finally getting the test, how will it perform in a macro bear market? Since inception, it pretty much has been in the longest bull market in history.

Starting point is 00:07:36 And so naturally, people wonder, will the macro win out? Or will Bitcoin, the strong fundamental, hash rate hitting all-time highs and many other metrics going to continue to accelerate? What will end up winning? Nobody knows, but it's always important to understand what the underlying fundamentals and the metrics of Bitcoin are telling us. Thanks so much for listening to today's episode.

Starting point is 00:07:59 I really hope you guys enjoyed this one. Make sure you're subscribed on Apple, Spotify, or your favorite podcast player. And if you're looking to try to transition to get a new job in the Bitcoin or crypto industry, we've got you covered. Head over to palmscryptocourse.com. We've developed a curriculum

Starting point is 00:08:13 with the top teams across the industry. It's a three-week intensive training program with over 50 events packed into that three-week time period. Go to palmscryptocourse.com to learn more and I'll meet you guys for the next episode. Thank you.

The Pomp Podcast - #1010 Here Is Proof That Bitcoin Is Very Cheap - BTC On-Chain Analytics

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