The Pomp Podcast - #1050 Miners Continue to Sell Bitcoin - BTC On-Chain Analytics

Episode Date: July 16, 2022

Today's episode is my weekly Bitcoin on-chain analytics update. I go through the Blockware Solutions newsletter and various other metrics to help you understand the state of Bitcoin during this difficult time in the market.  To see the full video with the corresponding charts referenced throughout the interview, go to the Anthony Pompliano YouTube Channel ======================= The number one name in NFT domains and the world’s most powerful wallet are teaming up to bring something new to the crypto and Web3 world: That’s right, Unstoppable Domains and Blockchain.com partnered to create NFT domain names ending in .Blockchain. It’s the perfect ending to show that you’re a believer in a decentralized future. The Blockchain.com community can get one, for free by signing up for the waitlist here. Free NFT domains provide all the benefits of premium Unstoppable Domains, including fee-free, lifelong ownership. Don’t have a Blockchain.com wallet? No worries, these new domains are available to everyone for as low as $5. Either sign up for a free blockchain.wallet or visit Unstoppabledomains.com to buy your domain today. ======================= Exodus is leading the world out of the traditional financial system by building beautiful and user-friendly blockchain products. With its focus on design and user experience, Exodus has become one of the most popular and loved cryptocurrency apps. It’s supported on both desktop and mobile, allowing you to sync your wallet across multiple devices so you can have access to your funds anywhere. You can instantly exchange around 100 different cryptocurrencies straight from your wallet. Interactive charts let you view an asset’s price history and your portfolio’s performance over time. And maybe the best part, Exodus is integrated with the Trezor hardware wallet - making advanced security easy for everyone.  Visit exodus.com/pomp for your free download or search Exodus on the App Store or Playstore. =======================

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 this episode, I break down the past week in Bitcoin, including on-chain metrics, various tweets that I find interesting, and any other information that I think will help you get up to speed on what's actually occurring in real time. I really enjoy these episodes, and I hope that you guys enjoy them as well. Before I get into this episode, though, I first want to talk about our sponsors. This episode is brought to you by FTX US. FTX.US is the safe, regulated way to buy and sell Bitcoin and other digital assets. You can trade crypto

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There's lots of uncertainty throughout the Bitcoin market. We continue to watch the price fluctuate right around $20,000. But the big macro picture, we see the Federal Reserve raising interest rates, and everyone wants to know, how will Bitcoin survive during its first true recessionary period? Let's jump right in and start looking at the Bitcoin network itself. We see that Bitcoin's price trading just above $20,000 as of yesterday, up about 1.68%. If we look at the network, we can see that the market cap of Bitcoin now sits just below $400 billion. The inflation rate is just under 2%, and more than 90% of the 21 million Bitcoin is now in the circulating supply. The real exchange volume for Bitcoin sits at $4.6 billion in the last 24 hours,

and the miners have been paid just under $19 million to continue to secure the Bitcoin network. We see that Bitcoin is down 70% since the all-time high of $69,000 back in November. Bitcoin is down 36% over the last 12 months. Gold and the S&P down as well. But over any other time period, 2 to 10 years, Bitcoin has absolutely dominated these other assets. Bitcoin closing history shows us that for 547 days, it's traded above where we are today. And if you bought Bitcoin at any point over 89% of Bitcoin's life and held it till today, you would be in profit. it. We can see that Bitcoin's compound annual growth rate compared to gold, S&P 500, NASDAQ,

and TLT, the compound annual growth rate of 117% is absolutely destroying these other assets. That five-year Sharpe ratio of 1.05 also means that Bitcoin continues to be a positive addition to many people's diversified portfolios. Now, if we just look at the Bitcoin network, it tells us one story. But of course, we need to go look at the on-chain metrics. Will Clemente and the team over at Blockware do a fantastic job every single week. Let's dive into the metrics that they shared this week. Will points out that the miners are very pro-cyclical forces in the Bitcoin market. He says that they hold their Bitcoin in the bull market and place orders for more machines that have a delay from when they were bought to when they're plugged in for a

variety of reasons, including manufacturing and shipping times and building out shelf capacity for the machines to operate. Due to this, hashrate cyclical peak has historically lagged the peak in Bitcoin's price. Then he goes on to show the Bitcoin mean hash rate, the 14-day moving average. And he says the machines continue to be plugged in at an aggressive rate throughout the late 2021 and into early 2022. But the Bitcoin spot price has declined by roughly 70% since then. And so there's a new variable adding to the compression, which is the increased energy costs driven by supply chain issues. Will's been tweeting about this for a while. If we go back to June 18th, what we see is that he said lower Bitcoin price, higher hash difficulty, and higher energy costs

have put serious pressure on miners' margins. Hash price is now its lowest since October of 2020. The hash ribbons have crossed, indicating machines unplugging and miners sending Bitcoin to exchanges. Then we can go take a look at the hash ribbon, and what we see is the juxtaposition of the 30-day and 60-day moving average of hash rate

to create a proxy for momentum moves in miner dynamics. Next up, we can see that the miner net position change shows that miners, they were selling some of their Bitcoin, it's cooled off a little bit, but that doesn't mean that they won't pick up again. And last but not least, we can see that the miners have been absolutely punished in the public markets. Those stocks continue to trend downwards. And the thought process is that if Bitcoin's price was able to recover, these miners likely would follow as well.

It tends to just be higher beta Bitcoin exposure, but history may only serve as a guide. It doesn't necessarily predict the future. I hope that you enjoyed these weekly updates on Bitcoin. I learned a lot by putting them together. It's also great to have people like Will and the Blockware team doing so much analysis on the on-chain metrics and looking at things like miners, exchanges, and the various market participants. That's it for this week.

I hope that you guys enjoyed it and learned something. I'll see you guys next week. Thanks so much for listening to today's episode. 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 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 pompscryptocourse.com to learn more and I'll meet you guys for the next episode.