The Wolf Of All Streets - BTC 44K to 40K! Should YOU be worried? | Crypto Town Hall

Episode Date: December 11, 2023

Crypto Town Hall is a daily X Spaces hosted by Scott Melker, Ran Neuner & Mario Nawfal. Every day we discuss the latest news in crypto and bring the biggest names in the space to share their insight. ►►TRADING ALPHA READY TO TRADE LIKE THE PROS? THE BEST TRADERS IN CRYPTO ARE RELYING ON THESE INDICATORS TO MAKE TRADES. USE CODE ‘2MONTHSOFF’ WHEN VISITING MY LINK.  👉 https://tradingalpha.io/?via=scottmelker  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/    ►► OKX Sign up for an OKX Trading Account then deposit & trade to unlock mystery box rewards of up to $10,000!  👉  https://www.okx.com/join/SCOTTMELKER ►►NGRAVE This is the coldest hardware wallet in the world and the only one that I personally use. 👉https://www.ngrave.io/?sca_ref=4531319.pgXuTYJlYd ►►THE DAILY CLOSE BRAND NEW NEWSLETTER! INSTITUTIONAL GRADE INDICATORS AND DATA DELIVERED DIRECTLY TO YOUR INBOX, EVERY DAY AT THE DAILY CLOSE. TRADE LIKE THE BIG BOYS. 👉 https://www.thedailyclose.io/   ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL  - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets    Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #Trading The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor.  Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Hello, can you hear me? Hey, man. Yep, I can hear you. Scott, can you hear me? I can hear you. How's it going? Good, mate. Have a good weekend?

Weekend? What do you mean? Today's Monday? Oh, shit, it's Monday. Yeah, yeah, it's a good week. Wild. How wild, I know. One second, just making sure we're getting everybody up here.

Yeah, I got it. Mario, I listened to about half or two-thirds of the replay with Alex Jones. That must have been pretty crazy. Did you hear it? I was also there with Andrew and Vivek taking a pee. That was one of the most phenomenal. Yeah, that part. That's some pretty classic Twitter space.

That's got to go in the Twitter space hall of Fame or something like that, I feel like. Especially if he becomes president. Can you imagine if he becomes president? Right. Yeah. If he becomes president, that's, like, pretty massive, I'd say. I completely missed it. What happened?

Vivek took a pee. Vivek took a pee live on Twitter Space, as you literally heard. Like, purposely? Or, like, did he not know he was he meant to mute himself i couldn't i couldn't i couldn't mute him either because it was glitching with too many people so i couldn't mute i couldn't mute anyone uh so he's peeing and i could hear him and i keep trying to mute him but it didn't work that's what will be you'll be remembered for good job just just getting just getting alex and elon to go back and forth on,

and Andrew Tate to just to go back and forth on the, you know, humanist versus, you know, anti-humanist. And that like, this is the sort of framework of power that is sort of the most critical for humanity right now i mean that's just a pretty wild that's a pretty wild conversation maria how did this come together maria i gotta ask because

that seems like a pretty uh random group no so i i we got alex to come on so he's obviously back on on twitter so the first thing he did was announce that on our show. That was because of Tucker, right? I listened to him on Twitter. Yeah, yeah. And we're talking to Tucker. Tucker could be coming on. We'll announce when Tucker

is going to be on soon. But so we're talking. So we told Alex, like, hey, you're not coming on Twitter. Just do it on our show. The team was messaging him. And so he accepted. So I pinged Elon.

I'm like, hey, man, I think that would be good for you to come on because I know that they don't. And so he accepted. So I pinged Elon. I'm like, hey, man, I think that would be good for you to come on. Because I know that they don't. They have never spoken. So Elon says, okay, cool. He jumps on. And then the rest come on. I don't think my team invited them.

Vivek always comes on whenever there's a space that's relevant to him. Tate I invited. Andrew and his brother Tristan. They both came on. Who else was there? There was Patrick Van David. What was Suleiman doing there? He had all these amazing people and then he had Suleiman there. I was like, what are you trying to do? Of all people to put Suleiman there, probably one of the most hated people on Twitter right now.

Yeah, but I've got respect for people that helped me to get to where I am. And I've got respect for him. He's never done bad by me. And he helped me moderate and co-host. He was there when I was getting all the hate. When no one else was by my side, he was one of the few that didn't give a shit and was fighting everyone. He put out the thread and he helped me with the private investigation. I think it was embarrassing to everyone at such a big space, to be honest. I wish you had told me we were going to be peeing.

I would have showed up. That was the only part that was probably unplanned. Yeah, I didn't get invited to that. Ridiculous. What about us? We've single-handedly carried you to Panhandle. Nothing. Mario would be nothing without us. Really. to pay nothing yeah it's a

fun space but it's gonna be a big one I don't think I'm not to announce it

but there could be a really big one today which is fine like a piece but yeah

it was a it was a pretty pretty I'll be checking the mail I'm sure

you'll have it I'm sure you've to this will match when that lasts. But I'm sure you'll have it. I'm sure you've got to check your DMs more often. Cool. You want to kick off the show, Scott? Ryan? Yeah, we should probably actually talk about crypto, right? Yes. I think the story, obviously, we've had pretty epic runs here on Bitcoin and a lot of other coins as well.

The entire market has been booming, pushed as far as 45,000. But we closed the weekly candle last night with the eighth green week in a row. I actually jokingly tweeted with no prophecy in mind saying when correction. And I went to bed at like 8.30 last night. And apparently five minutes later, we got the correction. Bitcoin dropped from roughly just below 44 to 40 in a matter of seemingly minutes when I looked at it. But it seems like, you know, in an hourly candle, bounced right back to where we are, probably just sub 42,000 at the moment. You know, obviously, it immediately triggers the bears to claim that they were right.

And the bear market has recommenced and it was just manipulation and all the fun narratives. But it seems to me like this was just a massive, actually massive, maybe overstated, but a big liquidation flush once again, where we had longs piled up. You saw over $300 million flushed. And in this case, when you look at it, I'm looking at CoinGlass right now. You look at the 24 hour, it was overall 86% longs, OKEx 90%, Binance 80%, Huobi 92% was all on the long side. Even last week on the push up, when we had the massive liquidations, it was actually, which is crazy to show you how degenerate people are, a lot of longs and shorts were getting liquidated. You would have thought it would be only shorts in that move,

but this is basically all longs. I mean, Rand, is that aligned with what you're seeing? No, I mean, I'm skeptical to call this a correction because it wasn't a correction. A correction doesn't bounce back that quickly. This was just a liquidation act, and the leverage is crazy. The leverage is still higher than it's been. Hold on, let me actually get the levels here quickly in front of me.

So on Bitcoin, the leverage, okay, on Bitcoin, it's kind of come down a little bit. I mean, you could say. But on altcoins, the leverage is still way above. I mean, the last time that we had this kind of leverage was before Luna. So the leverage now is higher than it was

pre-FTX. The last time leverage was higher than altcoin was Luna. And that's after this liquidation. So I think it's... I'm not sure that this is the end of the pullback. I'm not sure this is the end of it.

But on the other hand, you have this magnet which is the ETF, and for as long as this ETF keeps pulling us up, I just can't see how this market comes down. The one other thing, though, is you see a lot of ecosystems bouncing back really quickly. So Avalanche bounced back really, really,

really quickly. Immutable X jumped back really quickly. Beam jumped back really quickly. I think that's just kind of showing you everything AVAX and Injective both. About a dollar at the beginning of this year. It's now 24, 23, 25, somewhere in there. Incredible. Incredible.

Absolutely, absolutely incredible. And then, of course, there's airdrop season coming up. Airdrop season on Injective, airdrop season on Kujira, airdrop season a little bit. And people are now realizing the power of airdrops. In fact, one of the things I covered on my show today was we spoke about how airdrops, every time that there's an airdrop, so we had the blur airdrop, and straight after the airdrop, Bitcoin went up 80%, 18%. Then we had the arbitrum airdrop, and then you can clearly see a pump of 18%.

Then you had the PIS airdrop, and Bitcoin went up 23%, which is the combination of the PIS and the JITO airdrop. And so what we're realizing is that these airdrops are exactly like a stimulus. Initially, there's no money, and then you airdrop money onto users, and that pumps the market. So one of the market tools that we're looking at now is saying that the airdrops are – if you can forecast when the airdrops are going to happen, you can kind of forecast the pumps. And we've tested it now with these four.

We're going to test it with some more big ones, but it just feels like the airdrop stimulates is like a stimulus check that drops onto all the users, not only of the market, but also of the individual chain. So the individual chain tends to pump much higher than other chains

when you get these airdrops. Yeah. when you get these airdrops? Yeah, the airdrop season is so over my head. I didn't even know that was a thing. Okay, Boomer. Gareth, is this aligning with what you're seeing with the market? I don't know. Just before, on the airdrop point,

the liquidity doesn't make sense for an airdrop to be able to impact the price of Bitcoin. Correlation rather than causation. Before you say that, if somebody drops a billion dollars into the market and all of a sudden people have a billion dollars more than they had yesterday. Do you not think that could pump up the price? But, Ron, isn't it a billion dollars that can be sold into the market? Shouldn't it drop the price? I'm struggling to follow your logic here. No, it's a billion dollars that is dropped. It's like stimulus.

It's a billion dollars of money that didn't exist in the market, not existing in the market. Sure, but stimulus like you… Yeah, but how much of it is sold? US dollar stimulus makes the dollar inflate. It makes the price of the dollar go down. So when it's sold, what do people do with the money? So let's say you've got a billion dollars worth of PIS now, or whatever the number is, $500 million worth of GTO. What do you do with the money? All of a of a sudden you got this extra money what do you do yeah so essentially yeah i think that the the the token you get airdrop the token you get a drop will drop in price obviously um but then let's say it's a billion dollar airdrop how many of

them will actually claim it doesn't matter what the token, because the token that gets... Yeah, I know. The money... It's a new token. It's a new token, right? It doesn't matter. The money will essentially cycle into Bitcoin. That's the point you're making. Well, it do. I wonder why people think this is a Ponzi scheme. The money will go into... Usually,

the flow of money goes into the other tokens on the same chain. So, like, for example, a Solana airdrop token would usually pump other Solana projects and would pump Solana and other chains, including Bitcoin. But the biggest pump usually happens in the country or in the chain where the airdrop actually takes place. Ryan, I saw you had your hand up. Yeah, I was just going to say, I think there's some logic here that holds. Your mic isn't working.

I hear you, Mario. I hear you, Mario. Great, great. Yeah, when the Jito airdrop happened last week or whenever it was on Solana, the price of Solana rose like 10%. I think that makes sense. People are getting this massive airdrop on the Solana ecosystem. I think the minimum airdrop was valued at $5,000 when it

first dropped, and then it quickly doubled. And then you had people getting airdrops in the hundreds of thousands. And so a lot of people are just going to sell that right back for Solana and pump the price of Solana up. And then they're going to go back and airdrop far more projects right after that on Solana, like MarginFi or Jupiter. And so I think it's just this kind of, I don't know, super cycle. I know that word's banned, but there's this cycle that happens on the individual ecosystem of people just trying to airdrop farm, then taking those gains, selling them, buying the asset native to the ecosystem like Solana, and then repeating that.

That's exactly it. That's exactly it. That's exactly it. So kind of like to be honest, what I did was I got my Jito airdrop. When it got to like $3.40 and $3.80, I sold the airdrop and I went and bought more Solana. And you can see a lot of people actually repeated my behavior. How is this not a Ponzi scheme? Because these, I'll tell you how. Because these, so let's say you have a world where, for example,

Jito doesn't exist. And then all of a sudden, so then the value added in that world is whatever the value is before Jito actually exists. As soon as you drop Jito, you now have a world where JITO does exist, and the value that JITO adds is added to that country. So the GDP of the country actually goes up because there's more production in that country. And so think about a country and think about it like GDP of a country. I mean, say, before JITO existed, X amount

of value was in the system. As soon as you add a new factory, which is say JITO or whatever, you add the GDP. Hey, Corey, dare I ask you what you think of this? I mean, you know where I'm going to net out. Like, it just doesn't matter. These airdrops obviously aren't causing Bitcoin pumps. You know, there's just a lot more going on that matters a lot more. Things like, you know, dollar was weakening for a minute, front running the ETFs.

I mean, tech is pumping. So anybody that has Bitcoin in their risk on trade bucket still obviously has been been pumping that as well so i think there are you know four or five factors that more than account for everything that we've seen over the last two months every time we have an airdrop a big airdrop a meaningful airdrop at coin pumps or are you going to tell me that just the coincidence i mean i have to stay definitely definitely i don't i don't think there are that many people that are even aware of these things. You don't need to be aware. You don't need to be aware because the money is coming into the ecosystem. You don't need to be aware of it. Whether you're aware of it or not, it's not a billion dollars and these people that are interested in like you know pumping and dumping ordinals or whatever brc20s aren't usually the type of people to like buy and hold bitcoin anyway but this is a lot of great ordinary discussion this is a

discussion around uh arbitrum airdrop and a jito a drop and a blur a drop that's going to do with ordinals okay so why would. Okay, so why would that pump the price of Bitcoin? Because, as I said, imagine that you had no money and then all of a sudden you imagine that something... Right, but it's not a billion dollars, man. It's not a billion dollars that's being airdropped, right?

Arbitrum was a billion dollars. And most of these people that are signing up and being in a position where they're going to be like receiving. So these are altcoin airdrops going to places like Arbitrum. So these are the types of people that are like trying to fill their moonbags, hoping that there's like a high beta pump for crypto. Like the only natural seller of Bitcoin in the market today is crypto traders. There's nobody else that wants to sell Bitcoin.

It's only people that think that there's going to be like a bigger pump from some moon bag. So Corey, you know, let's take Run's theory and your theory and combine them. You're saying that there's very few sellers on the market. Run is saying that there's marginal buyers who are entering the market. Now, it's an empirical question and it would be interesting to examine this statistically, but on a theoretical basis what he's saying could potentially happen and I disagree with you that these people

don't want to buy Bitcoin. My argument would be that basically everyone wants to buy Bitcoin. I said in this market dynamic these types of people that are like crypto you know kind of just trying to play high beta crypto pump games are not the type of people to buy and hold bitcoin in a bull market that's not right hold on hold on i think i'm a great example and there's lots of people like me where i mess around with solana ecosystem tokens and then when

when i get a opportunity to sell i sell and i 50% of my profits into Bitcoin and 50% into somewhere else. And I think there's many, many, many people out there that take their profits into Bitcoin. Yeah. So look, the way this has worked in Ethereum is that, you know, there are people who sell these things and there are people who buy these things. The people who buy these things essentially send their Ether to people who sell these things. So 1% of NFTs, like the bad kids thing on Cosmos that Papaji Penguins or CryptoPunks kind of make it.

And then 99% of those essentially just lead to the sellers collecting more Ether at the expense of the buyers. So Bitcoin is different from Ethereum. I think Ethereum is like gas fees. You know, we are supposed to use it as casino chip and for all sorts of, you know, utilities, similar to, I guess, other old Telvin tokens. I think of Bitcoin as something, you know, I hold for my kids and, you know,

I die and they take with them. It's a bit like gold in Indian families. So, you know, I think as much as I like this innovation arc, I don't really think Bitcoin needs to become Ethereum. Those are fundamentally different assets. And I think a lot of this stuff is just people selling. You know, there are some good projects in that space that Udi and Eric have been doing, but there is a lot of trash that's getting sold. And I think it just means people will lose their Bitcoin for trash they never look at. I want to dig into Ordinals.

I mean, Corey came on all guns blazing around Ordinals and stuff like that. And there's a lot of pushback from the Bitcoin community around these Ordinals and these inscriptions. For those people who don't know what they are, it's essentially what you're doing is you're using every Satoshi as an NFT and you're inscribing, you can call it an NFT on every Satoshi. And the Bitcoin community is quite split where some people are saying, you know, you should be able to do whatever you want

with Bitcoin because it's completely a permissionless chain and it's not owned by anyone. And there's a small sector of Bitcoin maxis and not only bitcoin maxis but bitcoin specific use maxis that are now saying that this is a really bad thing for bitcoin and kind of want to end it to be honest and i i don't know the way corey came in guns blazing i think that he's probably of the of the um the opinion that uh these of the opinion that they should be ended. Am I right? No, you'd be wrong.

You'd be wrong. So first off, I think the framing that this is something that a lot of Bitcoiners care about one way or the other is pretty false. I think it's something that seems really important in crypto circles. But it's a tiny little corner of the Bitcoin user base that gives a shit one way or the other, frankly. And it's interesting to watch for the rest of us that are just kind of focused on Bitcoin adoption. And this is kind of a sideshow that's pumping fees. And obviously some miners care about it a lot because it pumps their bags and lets them mine extra fees each block, things like that.

But I think for the most part, it's something that no one should rush to judgment on. I've seen incredibly intelligent people say very smart and convincing things on both sides. And so I think it makes a lot of sense not to be reactive when looking at something that has increased fees, that has used Bitcoin as the system is currently set up. And, you know, it is, I don't want to say the word exploit because it's a loaded term, but it is a bit of an exploit. It was an unintended side effect of activating Taproot that this was able to be done so easily, putting JPEGs on the blockchain.

What's the downside? That said... What's the downside? I see the upside. I struggle with the downside. The downside is crowding out transactions from people just wanting to have lower cost transactions to transact, to open and close lightning channels, things like that. It's just made it really, really, really expensive to use the chain versus what it's been historically

at a time when, you know, obviously there's a lot of people around the world that still use the base chain to transact and they're being priced out. So there are a lot of people that want to see Bitcoin used, you know, as intended as a monetary chain and used for transactions for monetary purposes rather than for storing JPEGs. So that's kind of the argument against. I mean, I interviewed Michael Saylor about a couple of months ago. And one of the things that he said when he interviewed, he said, you know, it started off today with JPEGs, but later on it's going to be like final will and testament and documents that are really important that should live, you know, in an immutable fashion on the Bitcoin network.

And he sees that as a real like massive, massive, massive use case of Bitcoin. Yeah, I mean, so that's using horizontal storage instead of vertical storage i think what you'll see is people will wake up that that's kind of just a narrative that that ordinals folks are using to pump their bags it sounds a lot like everything on the blockchain or everything in an ft is well now everything in ordinals it's really just kind of like find and replace on the same pitch we've been seeing since like 2016 and it's it just doesn't make any sense what you will see is things like open timestamps where that's actually good enough to be able to tell that something wasn't altered. Like they just

used in the Guatemala elections, they use open timestamps to say, hey, these tally sheets, we've recorded that, you know, this data, you hash it with Merkle tree, you put it in the blockchain. And now you know for sure that it hasn't been changed since then, at least. And that's good enough for most of these things. At the end of the day, if you're trying to link digital space to meet space, you're in the world of contracts, you're in the world of humans. And so, you know, it's just the amount of data. If you were talking about what evidently, you know, Michael Saylor had a conversation with you talking about storing some data like that. Think of 8 billion people trying to do that.

It's just not going to happen. You need to think about vertical storage, hashing it, open timestamps, not trying to put the whole damn thing on the blockchain. It's never going to scale. Yeah. But maybe there's a world where important stuff goes in the bitcoin network and and and unimportant stuff is outpriced and basically goes on to some cheaper network maybe goes on to solana maybe goes on to like an avax or something yeah it's possible it could be something like that i mean satoshi back in the day said you know hey if you want to do i mean trading cards and stuff

like that put it on a different chain you know, you had this idea that there would be kind of like data storage change of some kind. I don't think you would have forecast the world that we're in in the last six years. But nevertheless, you did talk about things like that. But yeah, I would heavily suggest looking into open timestamps. I'm definitely doing a little bit of homework there and trying to get up to speed. You know, this stuff is pretty highly technical and so you know unless you're talking to somebody that really deeply understands tech and that does not include most of the people that are that are pumping ordinals and it doesn't include most of the people that are sort of having a reactionary

um you know moment trying to get them out most Most of these people, including people with technical jobs, don't actually understand what the right thing is to do here. I'm not going to call out any names because this would very much include me too, which is why I'm biding my time and just kind of giving it a little room to breathe and trying to let

smarter heads prevail. Sorry. I don't think there are very many people who think that Ordinals is going to be the standard by which this is done. Ordinals is, I think, pretty obviously to everyone, including Corey, when he published it, an extremely hacky protocol.

I think people are excited about Ordinals because they see it as an example of additional protocols that people can bring to bitcoin which allow more sophisticated use cases things like time stamping plus smart contracts the ability to introduce nfts the ability to introduce side chains the ability basically to introduce introduce any execution environment into Bitcoin over time. So we've seen ordinals, there's up and coming taproot assets, there's runes, which is what Corey is now working on. ZK coins, which Robin is working on, there's just a huge amount of

new protocols coming in. So I don't think people are excited about ordinals. I think everyone understands that ordinals is sort of just like the alpha version. Yeah, it's a proof of concept. Corey, while we have you, ETF approval, just a couple of questions. Firstly, are you confident in January? I mean, I saw that there was another big thing that actually happened, which was that Google changed the advertising policy to allow for, I don't want to misquote, but so they're saying, in January 2024, Google will update cryptocurrency and related product policy to clarify the requirementsvertisers operating cryptocurrency coin trust targeting the United States may advertise those products and services

when they meet the criteria required by Google. So, I mean, it looks like everything's aligning for a January approval of an ETF, right? Man, if you knew, it took me, oh God, it probably took 15 months, maybe longer to get approved for Google Ads. And then we got disallowed again for like six months. And then it took like another six months to get back on.

It's been the most ridiculous. I used to work at Google and I know a lot of people that have gotten pretty high up now. And it still was that much of a pain in the ass to be able to advertise anything related to Bitcoin on Google. And these guys come in and they're not even approved yet. And they're already approved. It just cracks me up. But yeah, that seems like a pretty bullish sign doesn't it ran so yeah does it do you think that am i reading too much into it or do you think that no they know it's they know it's coming and they don't want to do it on like january 9th

if these things get approved on january 8th right so it makes a lot of sense for them to to roll it out that's pretty smart of them to do it just before i think and do you think that the etf is in the is the etf approval is already priced in or do you think that they could still be like some kind of i'm going to put the pump on the 10th of january but i mean well i mean listen i think if it gets approved you're entering a like now the money can actually start to flow in. So there's, you know, there's the hodler and the trader pump that's been going on front running this news. And then once they open it and they start the advertising and the picture will probably be, you know, it will be interesting to see if there's a couple of Super Bowl ads. Definitely hearing some rumblings from friends in New york that work at agencies about this um you know so like i mean you know but but if it's

if it's not that then it'll be you know they'll use it during the nba playoffs and you know it'll be and they'll just be bombarded constantly i mean we all celebrate when there's a bitcoin ad every couple of years somebody does a nice one you know the twins did drop going i guess it was gbtc that dropped gold a few years back and you know you can hate gbtc and still like that they produced a nice ad uh the spiral uh the cash app uh block spiral crew did that that fuzzy guy a few weeks ago and we all loved that and coinbase is spectacular i mean it's beautiful yeah you yeah and they're everywhere and they're everywhere i was watching a college

basketball game on saturday and they showed it seven times wow yeah that's crazy and you know so i think these ads being about bitcoin specifically is the biggest thing that's going on in the space right now is we're kind of swapping out the top of funnel that we've had for the last six years, which is get sucked in by crypto, and then wade through that and figure out that there's this Bitcoin bank. And now the top of funnel going forward is going to be Bitcoin itself, from the most trusted largest financial institutions on the planet. So I think it is, I think people are actually... A bidding war for clients.

Yeah, bidding war for clients promoting Bitcoin by 12 companies at once wasn't necessarily my bingo card long ago. And it's a beautiful thing. Hey, guys. Thanks so much for having me up for a little bit. This is going to be my time slot. I'm going to try to join you guys more often for this 30 minutes before taking the kids to school. But congratulations, Mario, on an incredible...

You're going to cross 10 million listens for that Spaces yesterday. I listened to it. It was some of the most entertaining. It might be the most entertaining bit of media. You know, I can't think of anything live that's more entertaining than that other than maybe like your favorite sports team winning a championship that was just unbelievable and credit to the spaces team for creating a product that can freaking do this kind of thing it really is a special moment in time so congrats to you guys

thanks for it uh matthew go ahead and then uh then uh aust. Thanks for it. Matthew, go ahead. And then, then Austin, Matthew and Austin. Yeah. Hey, hey, everybody. I just wanted to chime in a little bit on the on the ETF commentary, because it is increasingly clear that we're engaging a lot more more with prospective clients who are kicking the tires on these dozen ETFs. So the largest regulated investment advisors, Wall Street brokerage houses, you know, will be allocating to these products. One of the major questions is, will they be allocating only on an unsolicited basis where the client actually just has to call up and say, I want one of these Bitcoin ETFs, you know, help me buy one. That will clearly happen. Whether or not they're going to allocate in discretionary accounts is a big question. probably not happen on day one because these investment advisors don't have a framework for valuing Bitcoin yet, at least the majority of them. And they also may be restricting these products to clients with, say, 10 million in investable assets rather than 1 million or 100k.

So the engagement is definitely picking up. VanEck had a filing with the SEC on Friday via our exchange partner, and we revealed the ticker of our spot Bitcoin ETF, which will be HODL, H-O-D-L, which is the cap that I'm wearing on my Twitter profile here. So, you know, thank you, everybody, for your support. With the Ethereum Futures ETF, we committed to give back a percentage of the revenues to core developers of the Ethereum protocol. We're working on something similar for the Bitcoin. So we're trying to straddle these two worlds of TradFi and DeFi. And it's really encouraging the prospective client feedback that we've had on the spot products. I think that there were some questions here about what's driving this altcoin rally and if airdrops are bullish or bearish. The fact is, people sell their airdrops when they think that crypto is going to go down and they farm and sell into USDC every single day. And when they think crypto is going to go up, then they hodl those airdrops, you know, believing

that they're bootstrapping the next big network. So it all swings back, I think, to what happens to Bitcoin. That's where the quantum of money is so large. And if the spot ETF flows are encouraging in January, knock on wood that they come. We're estimating $2.5 billion in the first quarter. We just released a top 15 predictions for 2024. I'll link to it in the comments to the spaces. And please, everyone, check it out. That's all.

Yeah, we started to go over those actually last week and sort of got disrupted. Mario, we still have to do that. I actually wrote a newsletter on that this morning, Matt. I thought the predictions were great. Really impressive stuff. Austin, go ahead. Hey, everybody. So as somebody who's worked in the asset management space, I think one of the things we're probably going to encounter here, you know, Matthew was speaking to it just a moment ago, is you're going to have this initial wave of interest. But I think the long-term effect of the ETF approvals will come

probably one year plus out, which is to say you're going to have advisors over time, especially in the RIA space, but also elsewhere, who start integrating this into model portfolios. And once you've done that, you are going to have long term sustained buy interest as clients come in, as clients allocate, as money comes in to Bitcoin. And even, you know, if you look at total capital markets, even a 1% allocation to Bitcoin and model portfolios across the majority of something like the RIA space will move this massively, especially in an environment where we don't have a lot of sellers right now. And so to some extent, what I want to get the idea out there for people is you may see an initial inflow, and then it may look like nothing is happening for quite a while here.

Understand how slow it is to make the sausage in a lot of these institutional places, right? Like when I was at JP Morgan, projects would take us 24, 36 months and we would call that fast, right? Which is quite a contrast to being in the crypto space. So just telling people the ETFs are a long game there. Just like, you know, honestly, I hear a lot of like the talking about airdrops and find it all very short-term tactical, right?

If we're looking at Bitcoin on a real basis instead of a nominal basis, you can knock you know 10 plus off the price for inflation we still have a long way to run to even get back to the highs of you know previous cycles yeah i think of etf approval is probably more like into the having right everybody gets excited having happens but it takes many many months six to nine months to really see any major effect from that supply decrease. I think the AUM flowing into the ETF slowly over time would be kind of similar to that.

I don't know if anybody shares that view, but that's kind of my base case. I think that makes a lot of sense. Brian, I saw you give a thumbs up. Is that kind of how you view it? Yeah, yeah, that's exactly how I view it. I mean, we have a survey. I think I've talked about it before here, but we survey financial advisors and investment professionals and every year and of the you know investment professional uh investor base doesn't expect etf to happen in 2024 which just goes to show that while we're all paying attention to this every single day because we're in the space and we uh are highly allocated crypto whether it's from your your career or just your personal investments i think we're following it and expecting an ETF

with a high likelihood in January or at least by March of next year. But the people that the ETF is built for, it's not necessarily on the majority of their radar. I actually don't think it's on the majority of their radar. I agree that it's going to take time for clients to start asking about it and more of a mainstream coverage of

bitcoin as a legitimate asset versus a speculative asset and i think the bitcoin helps kind of bring it from this being considered a speculative asset by the likes of you know cnbc and fox business news and uh you know even even, you know, you've seen Bloomberg kind of like change its tune on how it's covering Bitcoin over the past six months or 12 months. So,

yeah, I do think it's a why did I get, Ron, where can I get this research or where can I get some reference to what you just mentioned

in terms of numbers? Yeah, I'll send it to you. I'll send it over to you. All right, you want to send it to me in a DM, right? Yeah, yeah, I can do that. Perfect. I'll send it over to you. You want to send it to me in a DM, right? Yeah, yeah, I can do that.

Perfect. That'd be great. Speaking of being over allocated to crypto, one of the bigger stories that keeps being told here is that Cathie Wood is selling the hell out of Coinbase stock. And people are freaking out, don't understand that she has a maximum, I think, 10% allocation and literally has to sell as it goes up. I just keep seeing that story. It drives me nuts that people are saying that we should all be bearish on crypto because Cathy went to sell in Coinbase stock. She keeps saying the same thing. She keeps saying,

we rebalance our portfolio once a month or once a quarter. And every time they rebalance, the best performers are going to be sold. That's just how big funds work. Because otherwise they become unbalanced. And I know a guy who was very unbalanced once in the Luna ecosystem and I know how he landed up.

I know a guy who was a little bit overbalanced myself as well, not necessarily at Luna, but I think we all learned that lesson the hard way about reallocating in a bull market. I don't think you can blame her for taking profit and reallocating. It just drives

me nuts when you see the bad takes on these things. It's endless. Crazy. Is anybody worried about this leverage in the correction? What specifically? Are you talking about the fact that it's still so high on all coins?

Yes. That concerns me. I don't think it concerns me What specifically? Are you talking about the fact that it's still so high on all coins? Yes, yes, yes. Yeah, that concerns me. I mean, I don't think it concerns me to trigger another bear market, but I think that we can definitely see more downside. You know what concerns me? People are so convinced about this ETF that the market just can't go down. The market cannot go down every time we get a slight dip the the market quickly rebounds because everyone says oh you know that was that was great but there's an etf coming up so basically the point being that if we see a rejection holy like watch out below or just uh that uh it's a rational exuberance around

something that might not mean as much as you as people think it does all right travis oh i mean i mean i was just gonna say historically when when people feel safe about btc being relatively stable a lot of times that is the backdrop under which alts will go wild because i think people feel like you have sort of, you know, safety in, you know, Papa Bear asset being OK. And as long as you've got the Bloomberg ETF guys that are, you know, throwing out 90 plus percent, 95, 99. I don't know where they are right now. I mean, it's been it's been pretty incredible. Taking a step back, it's been pretty incredible that the crypto market, you know, BlackRock

filed their ETF. What was that like second week in June, I think. And it's it's it's more or less been the only, certainly the overwhelmingly dominant narrative of the crypto market since then. It's been pretty impressive that the entire back part of this year has been really totally dominated by the market collectively inching towards, you know, coming to believe that these ETFs are going to get inevitably approved and then narrowing in the timeline. And then there were, you know, if you think back to like October or beginning of November, there was some stuff that happened that made people think

that maybe it was going to be November or early December that they were going to get approved. And we somehow managed to like pull that timeline off the table and then narrow in on this second week of January timeline without price really pulling back at all. And then, you know, obviously skyrocketing higher recently. So it's been it's been it's been pretty impressive. I mean, I think it's probably a good thing. If we were, say, the first week of January, we were at 48, you would feel or I would feel

more nervous about a potential fade to news or the potential for initial inflows to be disappointing relative to expectations. you know i think what do you think the expectation is like i'm like i'm i know that like i'm in a little bubble here i've heard things like one percent and two percent of aum in the first year like what do you reckon

what do you think the market is expecting yeah i, I don't like it. I mean, those timelines, even $2.5 billion in the first quarter, which the other guy was talking about here, I would shorten it up even more than that. So Biddo was the fastest. The future of Bitcoin ETF is the fastest ETF ever to a billion dollars. That was, I think, two days, right? Yeah. It was either two or three days. I was i think two days right yeah it was either two or two or three days i think it was two i think it was two days and like so this should be in the neighborhood of

that or it's going to be disappointing i think relative to expectations now if we were trading 40 or we were trading high 30s instead of mid 40s or high 40s when it got released then i think you just have less you know you would just have less of a puke you know just just because of where you are on the chart basically in my head if you get if you you should get a billion dollars of inflows within the first five days i don't i don't really understand why that wouldn't happen if Biddo was able to get there that quickly. And this is a fundamentally, meaningfully better product. Yeah. A lot of people, Travis, are saying it's because we are at the peak of a bull market, even the experts. But I 100% agree with you. They did it in 48 hours and it feels like we're

in a pretty bullish market right now. I don't understand the dampened expectation. That's what I wanted to ask. Do you guys think that the fact that the price is high is a good thing or a bad thing? Good thing for inflows. Yeah, everything that's... I mean, think about all the things that have launched during bear markets, even the Ethereum futures, which I didn't expect that much interest in, but like flat, flat. But yeah, the question is, do you think these institutions are looking at it and going nah this is too expensive for us we'll wait for a dip or do you think the institutions are going

look it doesn't matter for us we're looking at this from a 10-year time horizon and if it is whether it's 48 or 46 or 41 doesn't really matter i think it's the latter but i think um the the point about the market is really the interest on media, the marketing, just generally people being excited about crypto versus being depressed and saying, I want to touch this. I think we're just reaching that zone where we're all getting those, you know, we kind of joke about it, but we're all getting the calls. And I had three people live in my neighborhood that I didn't even know knew what I do, like texting me about Bitcoin this week. It's happening. You know what I mean? And so I think that part of it, the marketing that's going to come with it, and then your person who maybe has just forgotten about it for a long time, checks the price for the first time and they say 44. That's not that bad, right? It's not 17. So I think that the general groundswell is better if people are viewing asset class

positively which we all know is follows the price it's an incredibly reflexive asset we all know that it's it's an incredibly reflexive asset and people like you said have a really hard time buying it when it's down a lot for sure so i think this general price range is probably a good thing i think you get a billion plus dollars of inflows in the first one to three days and you rip higher from almost any price. And the price is like a little lower, say high 30s, low 40s versus mid to high 40s, then you probably rip higher. I think if you get to the end of day five and you're like at less than 500, say you're like at 500 million or less of inflows, I mean, I would think you would puke on that. Yeah, that would be, I think that'd be quite disappointing

because people are going to be anchoring this, I think, to bid out. Well, okay, that's quite an interesting perspective. I mean, I'd be pretty disappointed if there wasn't a billion in a week or two, for sure. Yeah, totally. Yeah, that'd be a big problem, I think. That'd be way off of expectations. And then I think when you start stretching out to like first month, first quarter, then that gets a lot more opaque to me. are trying to trying to get into the machines of the asset management you know you know the wheels

of the machine of the asset management business and all this minutiae around what type of client tells it's going to be good for how many people you know it's like how many people are going to sell their spot bitcoin their spot bitcoin and buy the ETF. And the potential for that to actually have some kind of wonky price action around that because there's like a bit of a delay. I think there's actually a good amount of people. I have some normie friends that are like, I think, probably pretty good litmus test for, you know, just your average run of-mill normie that owns some some bitcoin and likes bitcoin for you know sort of you know insurance policy against monetary and fiscal policy your responsibility

type of stuff and like there's a lot of these guys that are scared shitless of getting hacked they're they are terrified of self-custody so they keep it on coinbase and they're terrified of keeping it on coinbase because they're scared of getting hacked. And so the amount of exposure that they have in Bitcoin is lower than they otherwise would be. And they're going to sell their spot Bitcoin, depending on where their tax basis is. I think tax basis consideration matters there. But I think there definitely is going to be people just selling spot Bitcoin and buying the ETF because they're like, thank God now I don't have to worry about all of this crazy stuff. It really does just scare Normies so bad.

Scares me. Yeah. I mean, honestly. Yeah, I went through. I had one of those like mild hardware wallet not working three hour waste time steps of my life last week that no normal person would have suffered they would have thought they lost everything and every time i even like i you know i interviewed pastel from ledger and he said well there was that one time and you're

talking about the ceo of ledger where i got so cute and i hid my wallet from myself and never found it you know i mean it happens to the best of people in the space. So I agree with you. There's a lot of people, as much as we would love to push people towards the idea of self-custody, we want nothing to do with it. Yeah.

One thing, one other thing that I don't know if we, I know we haven't talked about today, but it's going to be fascinating to watch what percent of total Bitcoin volume starts to trade through these ETFs and how much that changes the market structure of Bitcoin price discovery. And that's a great question.

Do we think we'll see meaningfully less volume on centralized exchanges and like, will it be additional volume or will it be subtracting from what we have already seen when the ETF starts trading? I have no idea. It's going to be really fascinating to watch it. But that's going to change. Like if you imagine a world where like you fast forward, say a year and like 25% of all

Bitcoin volumes happen sort of like by proxy of the ETFs. And then you have maybe like another 25% that happens on regulated KYC onshore exchanges. And then maybe like another 25% that happens on, you know, regulated KYC offshore exchanges. And then you have like another 25% that happens in KYC-free type of trading, DEX trading in some capacity, something like that. And just what that does to price discovery. It's just going to be very fascinating to watch. And if that number is bigger than 25% that's going through ETFs, you, I mean, you really should expect price discovery to change, the mechanics of it to change, the drivers of it to change, because the participants are going to be drastically different.

The market makers for these ETFs are going to be, you know, the largest market makers in the world, but they're not stepping into crypto exchanges to make the market. They're making it in the world, but they're not stepping into crypto exchanges to make the market. They're making it in the ETF. And then the ETF is sort of beholden to these redemption and creation mechanisms that are going to be served by, you know, this sort of like ring of OTC desks, Coinbase institutional desk, and then, you know, a few other large OTC desks, coin-based institutional desks, and then a few other large OTC desks. And that flow, in some ways, it kind of does end up on the screens.

Like the OTC flow, at a certain size, I think it does end up hitting the screens, so to speak, hitting the exchanges where you can see it in some capacity. But it's just going to be, that's just a very different market than what we've been experiencing forever. It's going to be interesting. I think it's going to be really, really interesting to see how that weighs out.

I think in general, it's just going to be more and more volume everywhere. But maybe that's my echo chamber optimism. I mean, it seems like liquidity would be higher and so volatility would be lower and the volatility and the volatility character the liquidity characteristics of bitcoin you know i did traditional for a decade before I got into crypto. And the liquidity characteristics of Bitcoin, you know, sometimes it's as liquid as water and you can just buy or sell $50 million and you don't even, price doesn't move at all.

And it's literally just, it's incredibly liquid. And then when it starts to get moving, the liquidity collapses by, you know by 80% or more. And last night was actually a perfect example of that. You can see it and you can look at order book depth and things like that. And that's not really how traditional asset classes move. Yes, of course, when volatility increases, liquidity decreases. But that sort of feedback mechanism that feedback loop in traditional is not anywhere remotely close to the way that bitcoin acts and so you can imagine these spot etfs shifting bitcoin liquidity characteristics closer towards like kind of

how traditional asset assets trade how how apple Apple stock trades, something like that. Or let's pick something that has a market cap a little bit closer to Bitcoin, something a little smaller than Apple. But like like it's you can imagine liquidity not vanishing in the ETFs to the same degree that liquidity vanishes in spot Bitcoin trading. Yeah, I mean, people literally take their coins off exchanges and put them in self-custody. That's not going to be happening with an ETF, right? Yeah. And market makers just do the, you know, it's like, I mean, you know this, Scott, you've been in this market a long time.

Liquidity or sort of like liquidation waterfalls is a hallmark characteristic of bitcoin price action you would agree with that right yeah 100% we saw it today yeah it's like one of the defining characteristics of bitcoin price action is like oh you get these these these these cascading uh uh liquidations in both directions. Market makers know this, and thus one of the prime characteristics of Bitcoin price action is that these get caused. You see when potential for these things build up,

and then there's rug pulls in either direction to cause these things to happen. And this is a defining characteristic of Bitcoin price action. And there's a real potential for that to be significantly diminished. In calendar year 2024, you could fast forward a year from today, and that feature could be significantly diminished. And that's just like, I don't think you can overstate how it's a big change. Go ahead, Simon. Yeah, I think custody is going to be one of the most interesting ones to watch from here because this redefines custody.

You know, those that self-custody. One thing I didn't predict is that we would have like 10 Bitcoin ETFs because for the last decade, I've always been imagining you'd get this one player. But then you have 10 Bitcoin ETFs that are bringing in all of the largest pools of capital around the world. And they're all using Coinbase. And so Coinbase custody becomes a very centralized custodian are we going to get the tradfi custodians you know traditionally you've had your bank in new york melon uh do they all start stepping in right now or is it the experience of the what the one that has been able to custody a scale for the longest period without having to report any hacks um i mean i'm

pretty surprised we haven't seen state street and we'll talk about bank of new york mellon as a part of this for sure i think they got spooked i think i i i think that those two in particular got spooked after after fdx collapsed and i think they got spooked but also remember now i can't remember the specifics i don't want to misquote but there was either a floated law or something proposed that they were going to have to hold dollars one-to-one for all crypto assets they custody which literally made it impossible for them to even consider doing it yeah and then and then you've got like the intersection between how it interacts with the bank's balance sheet. You know, when we've already started to see the challenges of having to match up your assets and liabilities, fractional reserve,

all of those things are to come. But I also think, as you start going more exotic, and you go, you know, down, so obviously, with Bitcoin, you've got a separated custodian node and a miner. But once you start to get into some of the proof of stake and governance plays, where those that own the token, are they going to pass those rights on to ETF? How's the staking going to work? Who's going to control those networks? Essentially, with Ethereum, you could just, through Ethereum ETFs with all these large players, I think you're going to end up with a network

of these large pockets of stakers that are going to be involved in the future of governance, where actually they're just pulling together. And then, you know, much like Larry Fink has a, or the organization BlackRock has an influential position in ESG, because they can get themselves a shareholder vote, all the different companies around the world, that that's going to come to the staking networks as well as we go further and further down. So it's gonna be a really

interesting one to observe with lots of unintended consequences and interesting side effects what what is coinbase coinbase delegates their votes don't they for the eth that customers stake on how do they yeah because if i knew that most people most people have their own account, own their own Bitcoin with nothing, you know, well, like, yeah, they're a custodian in the middle, so they delegate. But then you've got Coinbase custody and how they deal with that. I think it would operate in a similar structure to how voting works for shares and ETFs. And BlackRock is very influential on all the boards of all the companies in the world. It's such an insane statement. Think about it. BlackRock is extremely influential on every board of every company in the world.

And effectively, just because of their indexing and the amount that they have to own of all of these things, that ends up being the case. Which should show people how important it is that you have Larry Fink who can go on TV and talk about anything calling crypto a flight to safety, right? I mean, it's really, I think it's bigger than people realize. Austin, go ahead and we're going to move towards wrapping after Austin. Yeah, absolutely. So I was going to say, you know, on the vein of a previous comment to bring things back around to some of the problems with the ETF, the thing blocking most of the bank custodians is SAB 121, which is the SEC interpretive memo that basically tells custodians if you have crypto assets, you have to treat it like you own those assets. When that interacts with bank

capital rules, it basically makes the business totally impossible. So I wouldn't read this as State Street and Boney Mellon being spooked. I think they very much want to do the business. I would read this as US regulators deliberately fucking it up so that they can. Yeah, that's exactly my take. Just putting potential rules in place or just being purposefully vague enough that they can't really enter with any sort of confidence. Mario, we good? I think we covered it all today and I'm assuming that we're going to have a

lot coming this week. Yeah, Matthew, we're good to wrap up. Thanks everyone. And we'll see, we'll see everyone again tomorrow. Same time.

Thanks guys. Bye bye. All right, guys.