The Wolf Of All Streets - Crypto Bloodbath! Why? What's Next? | Crypto Town Hall

Episode Date: March 15, 2024

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Testing. I hear you. You're not meant to be here. Can you please fulfill your promise of not being here when you said you won't be here? Don't worry, I'll leave soon. I just had that one cheer on to you to make sure you were thinking about me all week. I heard Bitcoin is dead, Scott. Yeah, I think it dropped a couple percent.

I think it's actually going to zero by Tuesday. I think so. I think so. It looks the same. So hold on. Should I change? Should we mess around one day and just change the title? Bitcoin is going to zero.

One day we should do it when Bitcoin is down more than 10% just to freak everyone out. Confirmed. Bitcoin going down to zero. And then we get sued for market manipulation. Let's kick it off. I know, Scott, you won't be as online as usual when i was just looking at the etf inflows and outflows so obviously it's kind of a market overview um which is pretty simple just go to coin market cap but in the last 24 hours bitcoin's down

5.5 it was it's actually pretty funny at my team so i wake up and i go through my tweets so we tweet 24 7 on my account we have a team of like 10 to 15 people that do it, all trained. And they're not deep in crypto. So we have a different team for our crypto accounts. But for my personal account, it's a non-crypto team mainly. And they're putting out like breaking news, Bitcoin down 6%. Breaking news, Bitcoin continues to go down, now down over 7%. And like all the people that know me, they're like, Mario, since when do you freak out when Bitcoin's down? I told my team, I deleted the tweets or one of them. Breaking news, it's a

Friday. Great. They're like those major news that Bitcoin's down 7%. In their mind, they don't know that we're still above, or at least we were above all-time highs, or at least last world market's all-time highs. But yeah, just so markets bounce back, I think Bitcoin went down to like 6%. Let me see exactly what it went down to. It went down all the way to 65,800 early today. And now it's back up to – okay, now it's up to 68,000. So it's down 5% in the last 24 hours. Ethereum is down at over 5% as well.

Solana's down. Nope, up almost 10 that's fucking crazy so now there's market cap is at 80 million ethereum is at 444 um everything else seems down this is insane in the top 21 coins the only one that's up is solana's what up more than one percent holy shit every time top 100 coins up to 53 that's fetch ai is up four percent everything else is down except solana and conflux not sure what that is in the top 70 coins so uh we'll get some feedback from the panel but the reason that we saw this bloodbath some people are saying is because of the ppi data came in higher at point six so it came in point six

higher which is higher than expectations doubling the pace that we had in January and doubling economists' forecasts. So kind of reducing the hopes for a rate cut. Maybe we go to Peter first. Peter, your thoughts on the macro data that we got, and Juan, we'll go to you in a bit to discuss the ETF inflows or the lack of for yesterday.

But Peter, we'd love to get your thoughts on what led to this bloodbath, if you want to call it that, just a small correction with markets pumping too fast. But your thoughts on what we've just seen and how related is it to the PPI data? Because the sell-off started during the US trading hours on Thursday, which is pretty much as soon as the PPI data came in. On non-event, we had an 11% sell-off. We're going to have many 15% sell-offs in the months to come. It's not a bloodbath. In fact, it's not even a scratch.

And, you know, people should not freak out because the market moves around. And it doesn't matter whether it's over a five-day period or during a one-day period. We've got a volatile market. Just people go back and study past bull markets and Bitcoin. These things happen. And it's not anything to get totally confused or concerned about. So I looked at 10%, 15% setbacks as a buying opportunity for those that still, you know, have bullets in their guns. So definitely not something to get freaked out over. And whether it's tied to, you know,

it's always going to be tied to somebody, something. I just remember back in the days when I trade livestock, there was a day when hog prices were sharply lower and the Wall Street Journal reported that they're sharply lower because of oversupply. The next day, they go limit up. And the Wall Street Journal reports that hog prices are up because of increased demand, because of lower prices the day before. You know, these are not things to get terribly shaken about. Trends up. Stay with the trend.

Buy the dips. And of course, the only thing I really care about is Bitcoin. And everything else can do whatever. It's like the human brain cannot accept not giving us genetically. It kind of makes up the human species that we cannot accept not knowing. We cannot accept something happening without understanding what the reason is. So we start either linking it to something unrelated, correlation rather than causation, just making up a reason. So what you're saying, Peter, is that PPI data didn't have much to play.

When you said non-event, do you mean the corrections are non-event or the PPI data or both? Oh, no, the corrections are non-event. And the data is not unexpected. I mean, we've been down, down, down, month over month, month over month in inflation, which, of course, was an overreaction to the inflation we have. But so, you know, I still am looking at a trade that I've been involved in that I've talked about with you guys, and that's short, the secured overnight financing rate, because the market had anticipated,

like in the December 24 contract of SOFR, that the Fed was at one point going to have six rate cuts this year. Well, we're still three rate cuts higher than we should be in the December contract. So, yeah, the Fed is doing what the Fed is doing, which is usually the wrong thing. And so, you know, ignore the Fed, fade the Fed's doing, which is usually the wrong thing. And so, you know, ignore the Fed, fade the Fed. You're not surprising that inflation data comes in just a tad bit higher than the market's expected. And, you know, so now we go on to the next bit of news. So is there anything, Peter, is there anything on a macro perspective that would make you less

bullish and that would make you question that this is the beginning of a massive bull market? Anything that could change things? Any black swan event that's not too black swanish? That would make you less bullish, and that would make you question that this is the beginning of a massive bull market. Anything that could change things? Any black swan event that's not too black swanish? Oh, yeah. Sure. Have one of the ETFs get hacked. That would make me extremely bearish if we did a hacking event with the ETFs, how secure are their Bitcoins?

Big question. Unknown at this point. But we've got Juan on stage. Juan, how likely are the ETFs? We could talk about the infos and outflows right after, but how likely are the ETFs to get hacked? Yeah, that's a good question. Well, for one, all of these ETFs are using top-notch institutional-grade security where most of the coins are kept in cold storage, in very secure cold storage. And then what's being traded on a daily basis, that is on market. But they have very secure protocols. Actually, it's a timely question. For anyone interested in this very question, later today, the president of

Bitwise and someone from Coinbase and our CTO are having a Twitter space exactly on the question of Bitcoin ETF custody. So that's going to be, I think, at 2.30 Eastern later today for anyone interested. They're going to answer all the ins and outs on these questions. I think they're going to answer all the ins and outs on these questions. I think they're secure, and all of the ETFs have top-notch security. So I wouldn't worry too much about it. Of course, can it happen? Sure. But I'm not worried about that. So that's that. In terms of the, you know, to answer the question on inflows,

yesterday we saw the lowest amount of inflows this week at 132 million, but it's been a very strong week of inflows. Just on Tuesday, we had the biggest single day of inflows since the launch of the ETFs at over a billion. And this week in total, there's been 2.3 billion in inflows, which is more, by the way, in one week than the entire first month of January when the ETFs started trading. So we're still seeing strong demand and demand even accelerating in some ways. We're now sitting at $12 billion in inflows into the ETF since launch. The combined AUM of all the ETFs is at $59 billion.

So this thing is continuing strong. But, you know, of course, after about a 70% rise this year for Bitcoin to the new record highs this week, just shy of $74,000, Bitcoin can, you know, you can expect it to be vulnerable to a correction.

And as Peter was saying earlier, you know, people can look for any excuse. And now it's the PPI this week pushing rates higher and making the dollar rise. And as we know, all things equal, higher dollar and higher rates tend to be negative

for risk assets like Bitcoin. So people can attribute it to that. People can attribute it to what they want. But after such a large price gain, you know, markets calibrating, some people are taking profits. We have seen, you know, the liquidations, 800 million in perpetual futures liquidations in the last 24 hours. That's the second largest 24-hour liquidation figure this year, 660 million in long liquidation. So people are taking profits, recalibrating. But fundamentally, the supply-demand picture still looks very strong. I mean, I think it's going to be difficult for these cells to put a long-lasting dent

on the uptrend as long as the Bitcoin spot ETF demand can remain strong. And that is our expectation from what we're seeing. So, Juan, if you could fix the mic, that would be great. And I'm going to go back to you in a bit. Fred, I'll go to you, then I'll go to Mike. Just one thing we've been discussing, I've kind of been away from the space for a few days, but prior to reaching all-time highs, I think we did space right after breaking all-time highs.

And we talked about, with Dave, he was on stage and we talked about price discovery and then you know in the 60s range and especially after we hit we broke 69 70k we got into full price discovery which means that it's hard to predict where the price will settle but what happens once you go down below all-time highs how does that work from a technical perspective and a sentiment perspective and how important is that let's say say, 69K level? I think we're at 68K now. I think we've closed there or closing there. How important is that?

Well, you know, first I wanted to say happy birthday to the little wolf out there. She's in her last year a single digit. So then she's just going to be double digits like the rest of us. I hope you have a good day today, Scott. But as to your question, Mario, I think I'm not a technical guy, but on the sentiment side of it, you know, we've got the new factor with the ETFs and I, you know, it's a, everything seems to be going as it always does in these cycles for whatever

reason, which I always find shocking. But we've got the ETF side of it here. And no disrespect to the very cool boomers that are out there, but we've got a lot they're going to react when an ETF that, you know, usually never moves by the percentage points that we see Bitcoin move, all of a sudden plummets 10, 15, 20 percent. And everybody else in the crypto world is like, that's not that big. But is that going to, you know, when it goes below that trend line or that safety point is it going to freak everybody out in the etf world the retail people in the etf world and then we'll see it cascade down and then we'll see another huge ride back up i mean that's the question that is going to be that we haven't had in this cycle and it's going to be really interesting to find out that's actually a very good point one um could we still have you on stage that's the that's a concern that we've discussed in previous spaces where everyone was very excited about the ETFs pumping the markets and the massive inflows. And then a few of our speakers kind of asked the question, what happens when Bitcoin corrects? Are we going to see that now? Is that enough of a correction to see how the, as Fred says, the boomers will react yeah well you know we all who have been in the space

know how volatile the market is and when things uh start gaining momentum to the upside or downside things can go for longer and and and deeper than than people anticipate so there is uh you know there's a lot of chartists uh and and technical traders in in the crypto market. And for those looking at the charts, in a corrective scenario, the 65,000, 60,000 areas are of particular interest because they go back to important Fibonacci retracement levels at 76%, 61% retracement lines for Fibonacci. So market could go down there. At the same time, there is this continuing daily demand of inflows from the Bitcoin ETFs that help stave off some of that.

But, you know, there's leveraged trading and the crypto markets are always leveraged to a certain degree. And if people start getting liquidations and you start seeing a cascade of that downward, it could overwhelm the demand of the Bitcoin ETFs, depending on a day. I mean, yesterday you had a light day of inflows at 132 million from the ETFs. And in the past 24 hours, we've seen 660 million of longs being liquidated. So, yeah, that's going to overwhelm it and then push it down. We'll see what the demand is from the ETFs today. We're entering the end of the week in a volatile fashion. Next week is the FOMC meeting. So we could see volatility going

into the weekend in anticipation of that, given that now with the data this week, their expectations for rate cuts are being retraced further. And that, of course, is not on a macro level positive for Bitcoin. So who knows in the short term where we go from here? We could go lower. But again, the demand supply picture is very constructive over the next next months and over the next year. So on a short term basis, who knows? But as as as Peter was saying earlier, who cares?

We're in this bull cycle. And and it's you know, these retracements are opportunities to buy the dip because, As Peter was saying earlier, who cares? We're in this bull cycle. And and it's you know, these retracements are opportunities to buy the dip because, you know, for the for for the retail trader, it's a it's a great opportunity if there's there's these retracements because there is this ongoing demand from the ETFs that's going to continue through, you know, the next the next year. Our CIO, Matt, was just yesterday giving a keynote at Barron's top independent advisor, which is the summit of the largest independent RIAs in the country. And on a sort of show of hands basis, he was looking at about 40 percent of the crowd owned Bitcoin personally, but only 5 to 10 percent of the crowd said they had allocated for clients at that point. And all those people are currently working on the due diligence processes to be able to allocate map things. They're coming within the next, most of these larger independent RIs are in the next three to six months are going to start allocating.

And so you're going to see continued demand from large institutional players. And I want to, sorry, just going through the notes. What Eric said a few days ago, I think, he said that the ETFs on a positive note, the ETFs have not yet appeared on any important offline asset management platforms. These platforms manage approximately seven to $10 trillion

and are expected to list BTC. So the Bitcoin ETFs in the next few months and also Bitcoin ETFs in the next few months. And also Bitcoin ETF options trading is expected to be launched by September. So it's actually, Juan, one point of concern is how will the ETFs react to such massive corrections we're going to see today, the inflows and outflows today, and if the liquidation continues, we'll see how the ETFs react. But on a separate note, and going back to your supply versus demand, there's still a

lot of untapped demand that's not being talked about. Is that fair to say? Yeah, I think that's fair to say. And just as a data point example, yesterday, we saw the announcement from Satara Financial Group, which I think manages somewhere in the 300 billion range, announced that they just approved some of the ETFs on their platform. And that's, you know, one of the first announcements from one of those very big RIAs. And so, you know, there's the first data point and you're going to continue seeing more. So, yeah, the demand is going to hold steady. Now we'll see

on any given day how those inflows outflows uh compared to uh compared to you know market liquidations if we're seeing a correction um but you know over the medium long term i'm not concerned yeah charles house concern i think it's glitchy i'm not sure if anyone could see him on stage there's a bit of a glitch it just says connecting charles so you might need to kind of false close twitter and uh and just join back. We'd love to have you on stage. Let me go to Mike. Mike, it's been a while. It's been a while we haven't spoken.

Are you still bearish? Oh, no. Well, I have to echo. I turned a little while ago on that. Okay, cool. I thought it's been a while. I kind of – it was a prelude there. It's been a while we haven't spoken.

So maybe you turned a while ago, but I wasn't there. But echoing what Peter said is just one of the best things to do sometimes is, unless you're a day trader, which a lot of you are apparently, and I've learned the lessons of trying to day trade, is you've got to ignore the day. Minimum, look at a week. We're still well above last week's high and well above the high before the week. But this is a clear bull market in in bitcoin but

thing to remember is we've just this quarter we've made all-time highs in the sb 500 and bitcoin and gold and the bottom line with higher than expected inflation numbers is a lot of that's being driven by the wealth effect from the rising stock market and cryptos and this massive speculative frenzy so the key thing you have to watch is every single day you see the stock market goes up all those fed expectations for easing in the future go down and to me that's the problem now is as a fed watcher for decades is this is a really rare environment for the fed to even speak about easy because there's a significant speculative frenzy going on in the stock market massive wealth effect their inflation numbers are the inflation data is double their targets

and ticking up lately and we see massive speculation in rapidly rising prices in bitcoin and certainly the stock market that's not environment to ease unless you're very responsible you want to be political and that's what the market's starting to figure out. So here's a pretty thing I'm thinking about. To me, the big problem is beta. If you just look at people who watch S&P 500, that's the global measure of beta. It can drop 10% and mean nothing. I mean, absolutely nothing.

So on the year, the total return is 10% or 8% or so. At least it was as of yesterday. That's a great year. And it's only March 15th. I mean, it's a great year already. So I think the rational investors are if they're, they're the hot money that I know that I used to trade with. If they're getting long here, they're doing with option strategies. So they don't have that negative gamma on the way down, just participate in the way up. I'm talking to stock markets. So to me, the big issue here is

Bitcoin hasn't had that test yet. It hasn't had a test of, let's say, the S&P mini is going back to do a normal back and fill down to 4,600, which is nothing, big picture. And, you know, E-mini is right now at 51, like 10% correction. And see how Bitcoin reacts. And that's where I'm concerned. But overall, I mean, this is a clear-bow market. I mean, don't fight the tape. Don't fight the trend.

And don't fight the money. As Juan pointed out out the inflows are still strong i show total of about nine billion on the bloomberg terminal so far flows since etf started and then you look over at the total aum now etfs i show around 70 billion that's bitcoin etfs that's about 40 percent of the total aum of gold ETFs. That's a shockingly quick catch up. So yeah. So what were the numbers? Can you say them again, please, Mike? So if you look at total ETF holdings in Bitcoin that I have in a Bloomberg tariff, show around 70, it's low 70 billion. Let me just pull that up here. I show 73 billion, actually.

Grayscale is the number one, 29 billion. iShares $14 billion. I can go down the pattern. But those are the main ones. And as far as flows, the inflows have been around $9 billion since the ETF launch. Now like I said, the macro to me is what's notable. Looking on the screen $73 billion is a total AUM of Bitcoin ETPs. That's just ETFs now. And that compares to about $180 billion in gold.

That is a very quick pickup. So there's still outflows in gold, still inflows in Bitcoin. Sorry, Mike. Did you say $180 billion for gold? $180. about that. Yet, there's been about 20 billion of dollars of outflows in gold over the last year, if you take 12 months. It's a shockingly amount of outflows, despite the price going up. And why is that?

Partly because the biggest, one of the deepest pockets in the planet are still buying gold. And that number one is China. Just looking at those numbers, they're very different to what I expected. I didn't know they're getting that close. Juan, I'm sure Mike's numbers are correct, but any thoughts on those numbers before going to David and Dave? Well, none other than we've been surprised by the growth in the AUM of the ETFs as much as anyone else. I think I've mentioned it before, but going into the year before the ETFs launched, ourselves and most other market analysts were expecting somewhere in the order of $2 to $6 billion in inflows for this first year of the ETFs. And as Mike said uh we're north of well i think you said nine i i see more than that yeah i'm tracking 12 but anyways we're

way over what the initial expectations were and of course now with the rise in price then that's helped the aum growth and a and and as stores of value Bitcoin is in an early adoption phase. Gold is a mature asset. So Bitcoin has more upside. And so from a flows perspective into a newly institutionalized asset and from a growth perspective of adoption, there's no question that Bitcoin is going to continue catching up to gold. It's just happening faster than I think many of us expect it. Yeah, based on this, right,

like first I'm just shocked and no disrespect, Mike, but I actually went to Google Gemini just to kind of, to search the number, the AUM for gold ETFs and Bitcoin ETFs just because I thought gold was much larger and Bitcoin was still smaller. And you're right, like gold was 206 billion in February, 2024. And as you're saying now dropped 280

billion and then bitcoin etfs it says march 15th above 60 billion you said 73 so pretty much correct so it's actually we're we're you know more of a third of the way there basically if we continue on this rate um peter james i see both your hands up if we continue at this rate how long do you think it would take for bitcoin ets to have more AUM than gold ETFs? You know, the World Gold Council just came out with a report that showed that there's been outflows globally in gold ETFs going on for like 11 out of the last 12 months. At the same time, central banks around the world have been buying gold

with both hands open. So there's just a major change in ownership of gold. Now, some people attribute that to Bitcoin. The old gold bulls have somehow diversified back into Bitcoin. But the fact that there's been outflows for so many more months than we had, Bitcoin ETF suggests to me that investors have kind of abandoned gold, which for me is a perfect storm for higher gold prices, no matter what one thinks about Bitcoin prices. James? Yeah, I'm seeing exactly the same data as Mike McGlone. You know, over $20 billion worth of outflows of gold since the start of 2023. And just, you know,

it's echoing on what clients are saying. They're diversifying their diversifiers. They're seeing the high correlation between bonds and equities and looking for alternate assets to diversify. And Bitcoin does it better than gold. And so, you know, once I spoke to a client recently, he's got 15% of his portfolio in gold. And that unnerves him a little bit. So he's been adding positions to Bitcoin to kind of diversify your diversifier,

so to speak. So it's definitely happening. And on the point, there was points made about macro earlier. I had been wondering why prices have moved down so much. And to me, I immediately looked at the 10-year treasury yield intraday and looked at the Bitcoin price. And there's quite a close correlation. And in recent months, that has

really deviated. So we have been trading around futures rate and interest rate expectations in the futures market and Bitcoin for several years. And that link between the two has really deteriorated since ETFs were launched for obvious reasons. And it looks like in the last day or two, there's been a little bit of a recoupling between interest rate expectations and Bitcoin prices. Dave, sorry, David. David Tawil, good to have you. Were you in Danish's space earlier today, the finance space?

Yeah, Danish. Yep, Danish and I were on the space. Danish was traveling, so he wasn't on for the whole thing but yep it was uh yeah can you give us a quick yeah can you just give us a quick recap for today for the week and i kind of your thoughts on what james just said and also the correlation that was made earlier between the i forgot what it was other ppi data and the correction that we just saw yeah i i think uh look i i don't necessarily get too excited about any particular print. And even if it shows, you know, I don't know, a small trend, I don't think, you know, incredibly running very hot. So to have a pullback all around is not, you know, I couldn't have predicted it on the one end. On the other end, it's not particularly

surprising. You know, it's well deserved. I believe we're still in generally a strong economy. I think unless Powell has to eat his words and not cut rates at all this year, I think the market will continue to rise until we hear something different out of Powell's mouth. I think we'll get to one rate cut before the end of the year. It'll just be symbolic. It'll be symbolic of the fact that he keeps to his word. He's no longer, you know, as idiotic as he was when he said transitory in terms of the inflation. And so, you know, I expect we'll go that way. On the other hand, you know, there's a sticky level of inflation. You know, clearly the lower part of the socioeconomic population in the United States is still feeling difficulty. They're certainly not in a comfortable place, not in euphoria. Dollar General closing a thousand stores goes ahead and speaks to that.

And I think that the pullback in crypto, I don't think has anything to do with all of that. I think it's running a totally different narrative. It was running super duper hot in terms of just the last seven days of gains. And so therefore, you know, pullback, you know, makes sense in that regard. In terms of what we spoke about more broadly on the show this morning, you know, we spoke about the, and this goes to the point of the election year. I think the fact that we're in an election year, the administration is going to do everything it possibly can to go ahead and keep the economy humming as best it can. You know, it's trying its best to go ahead and buy votes every single way possible, you know, coming out against the merger between U.S. Steel

and Nippon Steel, potentially picking a winner and delivering U.S. Steel into the hands of Cleveland Cliffs is one way Biden is getting involved. The fact that they're going to go ahead and kick TikTok maybe into the hands of Steve Mnuchin or maybe into the hands of someone else. We don't really know everybody that's playing in that game. But to go ahead and move TikTok, you know, out of, you know, out of Chinese government hands and into U.S. ownership is another way that they're going ahead and buying votes. I just think that this administration is hell bent on doing whatever it has to in order to go ahead and stay in the White House and clearly keeping the economy strong. And when I say strong, that's on a relative basis. We've been very strong. The market has been very strong to go ahead and keep the market rocking and rolling

is certainly a top priority for this administration right now. And they're going to do whatever it takes to go ahead and do that. So I expect, frankly, to have a really strong market, crypto included, through the election. And we may get to some silly numbers along the way. Again, the volatility will cause institutional investors to constantly rethink, do I get into it now? Do I wait? Is there a fallout? So you think those corrections will have an impact on ETF inflows? Yeah. Charles, I've just sent you an invite. Again, it should work to come up as a speaker dave as well yeah david do you think they will have an impact on etf inflows which is so can i become it doesn't become a cascade if you so doesn't wouldn't it become a cascade because the bull market is being led by those inflows see correction the inflow can impact at least

to further correction and i just go the cycle continues downwards, spirals downwards, which we've discussed before. Mario, I think there's two channels of inflow that we need to talk about. We need to talk about inflows of people who are already in that will get in more, right? And when I say in, I don't mean the OGs of the sector. I mean folks that have already put 1%, 2%, let's say, in, and maybe they're willing to go higher on that and they're seeing the meteoric rise and they don't want to miss out on that. That's one channel. The other channel of inflows are folks that have not stepped into it at all yet. Right. And we're talking about the large portion of institutions that are out there and the large portion of wealth managed people that are out there that are under platforms that

until now haven't had any access. So I believe that the pullbacks in the flows will allow those people who are thinking, great, I always wanted to go ahead and increase my allocation. This is a good time to go ahead and get in because I believe it's just a temporary pullback. On the other hand, the folks that have never been in this type of pullback is going to go ahead and give them pause and say, do I really want to still be considering getting into such a volatile asset class? So I don't know how it's going to shake out on a net basis for the flows, but certainly this is going to lead to, I'd say, a good, exciting market. Your thoughts on this, Juan? And then I'm going to go to Tom. Tom, just get your thoughts on the markets.

We'll also start discussing you. Solana is just pumping right now. I think he's the best performing coin. That and Jupiter, which is Solana, are the two best performing coins in the top 100. So get your thoughts on the ALTS performance and the Bitcoin dominance is starting to slightly drop. As we get to get your thoughts on that, Tom. But Juan, I've seen your hand up. Go ahead.

Yeah. Yeah. Yeah. No, I agree very much with what David said about the two different types of more retail driven and then institutional driven channels for allocation. I just wanted to add one more point as a sort of theoretical thought experiment for the question of how quickly can Bitcoin catch up to gold? Well, you know, currently taking the numbers that Mike quoted earlier at 70 billion of AUM for the Bitcoin ETFs and 180 billion for gold ETFs. So that's, you know, 39 percent of the share of gold that Bitcoin has right now in terms of the ETF AUM. And, you know, just earlier this week, I was looking at the revised price targets from

firms that have put up price targets for Bitcoin for this year. And the range went from 100 to 150. So let's take kind of a midpoint there, 120. From current prices, that's about 70% upside. So if you take 70% upside on the current AUM of the ETFs of 70 billion, you get to about 120 billion, which would be, you know, 67 percent, catching up to 67 percent of 180 billion. That's assuming gold doesn't move much. It also doesn't take into account more flows that are that I think are coming into the Bitcoin ETFs. But you can see how quickly just on on the price move on a bull market, Bitcoin can can narrow that gap. And

as people were saying earlier, and it's it and I attest to it as well from my conversations with portfolio managers, is people are starting to really consider diversifying their alternatives exposure and their hedges, such as gold, and diversify some mix of that with Bitcoin and things like that. So that is institutionalizing and those flows are coming. And so I do think Bitcoin will continue to gain on gold. Let me go to you, Tom, and then Dave will go back to you as well afterwards to have you back. Tom, I'm actually excited to talk to you, Dave, as well after going back and forth with Tom, just because last time we spoke, Dave, was when we broke all-time highs. So me and you were on a massive high

and everyone was excited. So now we're seeing our first major correction since breaking all-time highs. Again, I find it to be silly to call it a major correction, but let's just use that term. It'd be good to get your thoughts there, Dave. But Tom, first general thoughts on the markets,

but also how are the Yelts doing? I know you work at Master Ventures. You know, me and Kyle talk a lot and we're close to you guys and your launchpad. What do you think that Correction is going to have on the rest of the market? Yeah, great to be here. Thanks for having me. Just for some perspective, guys, we've doubled in the last six months on Bitcoin. We're up 40% in the past month. And, you know, stocks have been ripping too. We're all doing really well. So we could take a 5% per year. I think it's okay. And it's healthy, as many of the folks mentioned here.

And I think we're going to continue for the rest of the year. So that's going to bleed out into alts, especially alt L1s. So you mentioned Solana. And man, I could not be more bullish Solana despite this recent run up because it's a way to play so many different trends. If you think, you know, meme coins and we have this new sort of attention economy where, you know, you're chasing eyeballs and clicks like there's no better place than Solana. Every meme coin is airdropping to wallets over there. So that's one trend you can lean into, whether it be Dogwood or others. You don't have to buy the individual assets, just buy Solana. And then out of that, you have this enormous wealth effect in that economy. You have all of these newly rich people from these crazy

tokens who are ready to explore within the Solana ecosystem. And you're going to continue to see that too with all of the airdrops from the actual applications on Solana. So you mentioned a few of them, Jupiter, Drift, and a number of others that are having upcoming airdrops from all those points programs they've been running. There's going to be just a huge amount of capital that's just going to live in the ecosystem and start moving around to new projects. And then on the private side, which is where I focus a lot of my time, we're seeing a lot of deep into decentralized physical infrastructure. And then also a lot of AI projects and the intersection of AI and crypto using Solana and launching on Solana because it is the fastest, cheapest, easiest chain to use. And they make the developer experience fantastic.

And a lot of the coding languages and everything sort of align with what those folks already know. So yeah, I really couldn't be more bullish Solana because it just hits so many different trends. And I know it's run a lot, but if you continue to think that we're going to be in sort of a altcoin or a high beta environment for the rest of the year, I think you do want to leg out on the risk curve to Solana's. And Mario, you and I were talking to Niburu, a new L1 that just launched. That's another one. And a bunch of other kind of more new and speculative plays as we get into this really, really raging bull market. Yeah, we did Niburu's launch there.

It was a very successful launch. I think they, did they go on Binance? No, they went on the other exchange, not Binance, but they were great. I think we have them on our show later today on the other show. But yeah, Solana, the numbers, the market cap, as I was looking at it today, Solana's market cap is 80 billion. Ethereum is at 445 billion. So that gap is similar. It kind of reminds me of the gap between Bitcoin and gold.

It's tightening a lot faster than I expected. Dave, can you help us make sense of what's just happened in the last 24 hours? Again, not for me. I think not for anyone on the panel, but anyone in the audience is kind of worried. I don't think a lot of people, like in the comments section, am I over-exaggerating? Are you guys not really that worried? Because you shouldn't be, to be honest. And looking at the fear and greed index, which is sitting at 89, I don't think the audience is

that worried. But Dave, maybe good to get your thoughts on it. Well, look, the fear and greed index is generally a great contrarian indicator. I was at a conference yesterday, a hedge week conference. That was a digital asset one. And someone made a very interesting point. They made the point that inside of the digital asset universe, the bullishness is off the charts. And generally, that is a signal for a correction. And you expect to see a correction when that happens. And in fact, in this particular case, there are some reasons why, which I'll get to in a second. But if you go to the broader investing universe, and you talked about how bullish people are on digital assets, the answer is, oh, you guys are all extreme wing nuts. And it's not that. It's gaining, no doubt. But that, in general, greed in terms of Bitcoin is still, in the overall investment universe, is not particularly high. So what does that mean? That means that potential for short term correction, of course, because, you know,

the marginal buyers are still inside the crypto ecosystem, a bid to cushion those falls coming from the traditional assets via the ETF. And that's exactly what we saw. It would have been completely rational in days, you know, before the ETFs to have gone from 73 to 60 or 58 in a rampaging, cascading liquidation sell-off. That would not have been even remotely crazy if it happened a year ago, except there's actual inflows and people buying, which is going to cushion that fall, which is exactly why we saw 5% correction and not what is a more normal 10% to 15% correction when the cascade starts. So that's thing number one. Thing number two, for those who watch Macro Monday with Scott, Mike, and I, you'll know that I said two or three weeks ago and whatever, that mid-March is a particularly

troublesome time for assets that did really well the year before, because people have to start paying their, you know, they go to their accountants and they say, okay, I need to start paying capital gains. And Bitcoin did pretty well last year from the bottom. And there are probably a fair number of people that have to sell stuff in order to fund and pay their taxes that they're going to have to pay in April. And that generally starts right around mid-March. So was I a day off? I said March 15th. Okay, so it was March 14th or 13th, whatever. But at the end of the day, if this is what that is, then this is a much more mild correction than I might have anticipated.

Now, I'm not saying it's done, because there's still going to be some tax selling to go along with it, but you would expect that. The other comment, when you go back to the macro, is on interest rates. I don't think Bitcoin gives a crap about the interest rates at this level. I think 5% is not a big deal. But I think that people will, of course, on the margin, be discouraged if interest rates are not going to go down. But more importantly, we're adding $1 trillion in debt every 100 days now. And Bitcoin, at its core, most of the people who are investing, who are hodling Bitcoin and new hodlers via the ETF, are investing in Bitcoin because they don't trust the government can keep their financial house in order. And there's not a thing on the horizon that it looks

to be improving that. And so I'll leave with that. And that's kind of an important point too. Right. Yeah, I just wanted to tag along to what Dave was saying on the macro side with the alt, it's that, you know, when we've got another deadline for the next non-Bitcoin or the next crypto ETF, you know, the Ether one, I know Fidelity's was delayed. We've got another date coming up in May. I think there's some, not all of the alt factors in the alt season, but I think at least one factor is that we're going to get another etf and it's going to go from there and i would just caution anybody on getting too excited on that one because i just don't see any chance in hell that the sec is going to allow that to go through because at minimum you know that they deny it and they can deny it i mean it literally gary gensler could deny it and say

anything you want and yes it'll get overturned in a court but you know that's a four to six month process right there so i think that's another factor to be wary of when we're talking about the odds i mean i still i do still think as everybody else is saying that the trend is there and we're in that great season to be in crypto. But I would caution everybody that that's not a done deal. Yeah, sorry. Do you want to go to Douglas? I've just been reading some of the comments from the audience. Should probably do it at a different time.

Douglas, we'd love to get your thoughts on the discussion so far. And just kind of more moving away from the correction we saw in the last day, just look at the crazy bull market, the crazy pump that we've seen over the last weeks and months. How sustainable is it, especially considering the speed that we're seeing? And is it really just a supply shock that will continue this upward move to break 100,000? I think David made one of the best points, actually, just a few moments ago. And that point was that the reason that we hold Bitcoin is because we see inflation eating away at the value of the dollar. And so if the Fed's saying they need to keep rates up higher for longer, it means they're

worried about inflation, which should be positive for Bitcoin. But in this discussion, we've been talking about how higher inflation would be negative for Bitcoin. And I think it's irrelevant what rates are doing right now. And certainly it feels like that stronger dollar is going to eat away at Bitcoin. But the reason people are holding Bitcoin is because they see the dollar weakening due to inflation. And I think that that's not going to change. I also agree that in the ETF side, financial advisors and RIAs have yet to really start allocating.

And we're seeing every single day other ETFs filing to include this or funds filing to include this in their portfolios, and they haven't yet done so. And we're going to start seeing all of these announcements coming out that XYZ fund has added Bitcoin to his portfolio, and it's going to start at 1% or 2%, maybe it goes up to 5% or 6%. When you have a very low allocation in your overall portfolio towards Bitcoin, a 5% move becomes rather irrelevant to the size of your portfolio. And so I think they're going to see this continuation. And it's been very exciting to see ETFs taking out these large chunks and showing all these

volumes. But I think that it's going to continue for quite some time, that the appetite has not yet been filled. So I think that's very exciting. But we have to remember as well that while ETFs act as a balloon to the Bitcoin price, they could also act like a hammer. I mean, one thing that we could think about is if boomers are getting into Bitcoin ETFs because this is new to them and now they can

buy it, boomers also haven't been sort of in this cycle and understanding Bitcoin and all the stories behind it. They could have seen the story yesterday that Craig White is not the founder of Bitcoin. I thought, oh my God, this is terrible for Bitcoin. Let's sell it. There's not really a great education system that's out there to help the boomers yet. They haven't been down the rabbit hole and understanding things as much as we have. But Saylor said something a couple of days ago. He said, you could think of Bitcoin as being this mansion in the sky that's going to appreciate over time. And so if you have dollars, that's what we call people that are poor. This is what Saylor said. And so if you have dollars, that's what we call people that are poor. This is what Saylor said. And so if you have that mansion in the sky that everyone

can get a fraction of, that mansion is going to go up as long as the US continues to print dollars. And I think that that's the important overall macro thing that we have to be 30,000 feet above. And all the rest of it is noise. We always expect pullbacks when Bitcoin makes new highs. I think we all get a little bit overexcited and we can smell the froth and we can smell the FOMO. But in the meantime, we have to understand that it's going to pull back. FOMO comes and goes. But I think that the ETF is going to continue the momentum. We're going to continue to see buying and the buying is going to get stronger. At some point, GBTC is going to stop selling and we're going to see some real pumps higher. And obviously, the halving that we haven't talked about at all on this call is coming up faster than we can see.

So I think that momentum is going to continue. I'm very excited. I think in the short term, we all look at inflation and think, oh my goodness, this inflation number or what did Yellen say? But all of that's irrelevant. The fact is that the U.S. is printing dollars. The world is printing dollars. Congress and governments are not punished for printing dollars and going over their budgets. And as long as that's the case, then Bitcoin remains in play. Dave? Yeah, the most important point was I was going to echo the literal last thing Douglas just said, which is, yeah, the U.S. is printing dollars, but we are hardly alone.

And, you know, governments are not living within their means. Basically, Germany is one of the is the only G7, the only G20 government, I think, that actually cares about, you know, fiscal responsibility. And, you know, they're keeping that's why the long rates in Italy and Greece are absurdly low. I mean, having, you know, Italian and Greece bond yields being lower than American makes no sense for anybody who can think about it. But the fact is, is people who are investing in Bitcoin as a savings vehicle, which I think is whether the number 70%, I think is, whether the number is 70%, I don't know what the number is. It's a high number of long-term holders and new investors are looking at it as what's going on. Is this the death rattle of the fiat system?

I mean, people always forget the fiat system's only started in 1971. I mean, it's not that old. And there's just a lot of that. And considering the asymmetric potential upside of Bitcoin, it's one of those things that these squiggles don't matter to a lot of people. They obviously matter a lot to traders. And right now, under normal cycles, we would be in heavy alt season. You would expect Bitcoin to be languishing, alts to be picking up, and all the hot money to leave Bitcoin. But that's not been happening, except we are seeing Solana. And look, I'm a Solana bull. I'm not going to lie about that. But it is there's a lot going on. And, you know, there's lots of technology cross currents going on. And it really matters. There's

also to be blunt, and I hate to phrase it this way, I don't like to be a tinfoil hat guy. But there are certain people in power in this country who want to see Bitcoin's price drop. There are others who don't agree with that. And the reason I say that is because a Bitcoin at $100,000 or more come elections is going to be a very powerful negative force against those politicians who have been proposing things like 30% taxes on electricity for miners to kill Bitcoin mining in America or leading the anti-crypto market. Can you give us just an overview? How big of an impact do you think this year's elections will have on the industry?

Well, it's massive. So, like, I run a company, right? Well, I'm the chairman of the board of CoinRoutes. And we are opening offices and moving full speed ahead toward moving technology and businesses to Dubai. We're not doing nearly as much investing in the United States. We're not abandoning the U.S. yet. But if we end up with four more years of Elizabeth Warren running economic policy, it's entirely possible we'll move offshore entirely. And we're hardly alone.

And by the way, you know, I am, it pisses me off. I'm a patriotic American. I think that, you know, I think this is a huge problem. It is a big deal. I was in a conference yesterday where exactly one company didn't agree. And that's Promethean. You know, Aaron Kaplan and I had a couple of very interesting interactions that I'm sure you'd want to hear about, but there's Chatham House rules, so I'm not allowed to talk about it. But it would be really cool to have that discussion, I can tell you. For those who don't know who Aaron Kaplan is, he's the CEO of Prometheum, the single company who has a special purpose vehicle to be able to trade crypto securities, of which they're convinced that Gensler is going to stake a claim that Ethereum is one.

Which, by the way, is the reason, if they have a reason for denying the Ethereum ETF, they may not be able to deny it. But if Gensler says, well, it's a security and it's traded on an unregulated basis, and the ETF is going to hold it and trade it on unregulated platforms, that's going to be his reason for denying the ETF. And so understand, we haven't heard that one. It is different than Bitcoin. And it is something that whether they say it or not, we don't know. But that would be the reason if they deny it. But it was interesting. I will say that virtually everybody is looking at

this election as the pivotal question of will the US relinquish capital market supremacy by ignoring digital assets? That's really the question. And a lot of people have that exact concern. Appreciate it. Just for the panel, anything to add on that final point, Douglas, Juan, or Fred? It's spot on, Dave, on that last one, especially with the Ether ETFs. I think you're right on point. And I would echo that. And there are a lot of candidates, everybody out there, especially in the U.S., that are running on a pro-crypto basis. And, you know, you really got to, I know we all crypto voter in the U S election, because whatever your issue is outside of crypto, you can do much more to affect that change. If you're a multimillionaire from, you know, responsible crypto policy. So keep that in mind. Do you think that crypto markets

performance in the last few months would change the voter, the voter sentiment, whether it be pro crypto, anti-crypto. So if the elections were like a year ago, you'd have a lot more voters that are either anti-crypto or they just don't care about crypto. But now the sentiment is changing as the market recovers. Oh, 100%. There was a comedian, I can't remember who it was, but he made a joke how he lived in Ohio. They were all swing state voters.

And that meant you could find a quarter on the ground. And all of a sudden you're like, oh, F it, I'm a Republican now. I mean, when people get a lot of money, their priorities change and they would like to protect that money. And if there's a certain set of politicians that are going to protect that and the other side that says, give me a 30% tax on your unrealized crypto gains, I think it would be pretty easy to know where they're going to protect that and the other side that says give me a 30 tax on your unrealized crypto gains i think it'll be pretty easy to know where they're going to go dave you agree 100 i mean look sherrod brown is in ohio and has been you know one of the biggest anti

you know crypto army advocates and almost all the arguments that he's publicly put forth during his career are bullshit. I mean, like literally wrong. You know, the notion that Bitcoin is bad for the environment, the notion that Bitcoin is only for terrorists, a notion that is too speculative and too risky and et cetera. You know, I whimsically posted this morning, as far as Elizabeth Warren is concerned for John Deaton, that, you know, I wonder if Massachusetts voters could go back and vote out the people who banned them from participating in the Apple IPO back when that happened. Would they do it? And the answer, of course, is yes. And so, you know, is history repeating that they're led by a senator who's trying to ban something that they're making money on? And that matters. That's why I made the point that if the market does continue to rally into the fall, it will make that issue more important

because people care. I mean, you know, James Carville, Democrat strategist to Bill Clinton, said it's the economy, stupid. And that's real. And people can't look at the same data. And there's one other point to be made on the election, and I don't really want to delve off into politics, but when you talk about the economy and what matters to people, it really is individual. There is a chart from the Federal Reserve Bank of St. Louis. They do tons of incredible work in terms of data. But what it shows is that the economy for native-born Americans, people who were born here, has not recovered the jobs lost in the pandemic. And all of the – we've had great employment, right?

Almost all of it are from immigrants or non-native-born Americans. In fact, because they've had significant increases in employment. So if you want to understand the disconnect and why people care about their pocketbooks, they care. So denying a technology that matters disproportionately to minorities and poorer people is probably not going to be a winning strategy if the asset class is performing. Yeah. So I mean, if the markets continue doing well, voters will care more, will make crypto a bigger issue when it comes to voting. And then the markets will react accordingly. So politicians will become more pro-crypto. And the markets dump and continue dumping, which is unlikely.

Then voter sentiment will change, and that could lead to politicians cracking down and it becomes a self-fulfilling prophecy. So essentially, it all depends, Dave, on the markets, what happens in the markets over the next few months. And what happens will determine what the voter sentiment will be like. Is that a fair conclusion on that point? I think it's a little bit strong. I'm not so sure that the correlation, you know, it depends when you say dumping and what, but at the end of the day, if people see that they

are being harmed in their own financial lives by policies. They will tend to vote against those policies. I mean, you know, once again, I don't want to put words in people's mouths, but there are a lot of people out there who believe that Biden is planning to tack back, which basically means his advisors are telling him the polls say tack back towards the center and away from this stuff because of the way the polls are. But we'll see. So it doesn't necessarily have to happen, be there in November.

It could be over the next two or three months that you see policy and platform changes as the platforms get solidified during the summer. So I think the next three months are out. But on the last point, that needs to depend on retail entering the industry. So if retail enters crypto over the next few months, we're talking about it in the last space we did together when we broke all time highs. If we start seeing retail enter crypto and then obviously benefiting retail, that sentiment becomes more positive. But if that shift doesn't happen in time, which is unlikely, looking at the current market performance. So if the markets continue doing well, retail enters crypto, then it matters more for the voters, and it becomes a bigger issue at the voting booth. I don't know that that's true. I mean, there are – I mean, basically one in five people in America have crypto wallets now. And I don't know that it needs to grow for it to be a bigger issue.

It just needs to be important. But what do you consider just a crypto wallet? It could be people that created a crypto wallet and sold their crypto in the last bull market and crash. It could be. I mean, look, I've heard stats as high as 40 million people own crypto in America. I don't know if that's true or not. I am not going to verify it. I have no primary data sources. But the point here is there are issues that resonate. And when people,

someone earlier said it, when people feel wealthy because of what they've done, if they see a politician coming to take that wealth away, they get very unhappy. And that wealth is no longer being correlated to FTX. Those days are over. No one's talking about SBF anymore. No one's saying crypto isn't SBF and fraud. Everyone's a fraud. So at least that sentiment has changed. We completely forgot about it. So it's just another plus on that last point. But I think we've covered everything. I think it was a pretty rushed space today, so I apologize. We didn't prepare as we usually do. But I'll see you again tomorrow in hopefully better market conditions.

And we'll go back to talking about the dog with a hat or whatever it's called. Dog with a whiff. Does anyone know the dog coin that's doing really well? I think it's a Solana coin. Dog whiff or something. Dog with a hat. Okay. I think it's dog with a hat.

Thanks, everyone. We'll see you again tomorrow.