Unchained - Unconfirmed: Strong Hands Aren't Selling Bitcoin. So Who Is? - Ep.249

Episode Date: June 25, 2021

Will Clemente, author of the BTC by WC3 newsletter, breaks down the current state of Bitcoin’s on-chain activity and explains why he believes the market is in a mid-cycle lull rather than turning bearish. Show highlights:  why Will is not worried about a bear market what indicators make Will believe BTC is in a mid-cycle consolidation who is selling and driving the recent market downturn why Will thinks the unwinding of derivatives is a significant factor in Bitcoin’s move below $30K what Will believe institutions are waiting on before entering the market again how Bitcoin cycles can be broken down into mini hype-cycles how long-term holders are acting on-chain the difference between long-term holders versus short-term holders during bear and bull markets why Will is interested in finding data on Latin American Bitcoin users how long the consolidation process might take what metrics Will has his eyes on for the latter half of 2021   Thank you to our sponsors! Crypto.com: https://crypto.onelink.me/J9Lg/unchainedcardearnfeb2021    Oasis: https://oasisprotocol.org NEAR: https://near.org    Episode Links:   Will Clemente Twitter: https://twitter.com/WClementeIII Newsletter: https://btcbywc3.substack.com/   Miscellaneous Links Unchained w/ Willy Woo and Raphael Shultze-Kraft: https://unchainedpodcast.com/will-bitcoins-price-go-up-again-yes-according-to-on-chain-analytics/  Willy Woo and Will Clemente ratio: https://twitter.com/woonomic/status/1407403983023460354 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi, everyone. Welcome to Unconfirmed. The show that reveals how the marquee names and crypto are reacting to the week's top headlines and gets the insights keep on what they see on the horizon. I'm your host, Lorishin, a journalist with over two decades of experience. I started covering crypto six years ago and as a senior editor at Forbes was the first mainstream media reporter to cover cryptocurrency full-time. This is the June 25th, 2021 episode of Unconfirmed. NIR is an open source platform that accelerates the development of decentralized applications. Overcoming high, fees and slow speeds with its fast, scalable, low-cost, and climate-neutral blockchain protocol. Learn more at N-E-A-R-D-R-G. The OASIS Network is a privacy-enabled blockchain platform for open finance and a new data economy. Start building your next idea on the OASIS Network. The crypto.com app pays you up to 8.5% interest on your Bitcoin. Get $25 when you download the crypto.com app with code Laura.

The link is in the description. Today's guest is Will Clemente, author of the BTC by WC3 newsletter. Welcome, Will. Hey, Laura, thanks for having me on. I'm very excited to do this. Great. So let's talk about Bitcoin. The market has been in a funk the last, I would say, maybe four to six weeks with Bitcoin

trading in the $30,000 range, roughly. And it even dipped as low as $29,000 on Tuesday. and yet people like you are not worried. Why not? Yeah, so I think I'm going to reverberate some of the stuff that, you know, Willie and Raphael had said on your podcast. I think it was a week or two ago that you had them on as well. But, you know, I primarily am looking at the on-chain data versus a lot of technical analysis and things like that, although I do look at that stuff. But, you know, in terms of on-chain, in my opinion looks more like a kind of mid-cycle consolidation versus necessarily a full-on bear market,

which I'm not ruling out the possibility that we are entering a bear, but at this time, it doesn't look that way based off of the data that I'm looking at. And so when you say mid-cycle consolidation, is that what you said? What does that mean to you? Like, what is happening? Yeah, so I think, you know, we only have two sample sizes, so I try not to compare, I guess, the price structure of previous cycles. But if I was going to compare this to anything, it would be the consolidation between the two 2013 double pumps where what you had was, you know, the long-term holders come in and kind of set the floor and, you know, step in and buy discounted BTC. you know, Bitcoin was heavily discounted, but in terms of, you know, in traditional finance,

people would consider it a bare market, you know, a drawdown over 50%. But in terms of on-chain, on-chain did not look like we were in a bare phase necessarily. So I think that this kind of resembles that. And for some of those reasons, one of the main ones is that, you know, you have the long-term holders really stepping in and buying VTC here, while a lot of the marked participants that have been selling are all very young. And you can see that in the age of the coins. Over the last two, three months, you can look at something called dormancy,

which is a variant of coin days destroyed. So the way you can think of this is like, the coin is in a wallet for one day, it's accumulated one coin day. And so then if the coin is then moved out of the wallet, it's then destroyed one coin day. And so looking at the coin days destroyed, adjusted for volume is what dormancy is. You can see that has been trending down continuously since, call it late February, early March. And that has continued to really move down over the last couple weeks, especially.

So the selling appears to be coming from not, you know, OGs or, you know, experienced market participants, but rather people that have gotten in somewhat recently, which, you know, a lot of people would think that it's primarily retail, but what I'm seeing is it's actually larger entities that are moving out. So perhaps these are, you know, funds that had gotten in, you know, after we broke an all-time highs or kind of, you know, hopped in when, you know, Tesla had bought. and, you know, Paul Tudor Jones came out and stated that he had a position. But, you know, I think those are the sellers that have been really moving out over the last couple months. I think also, you know, one of the two main drivers of, you know, this bull market were A, grayscale. And then B as well, I think there was a lot of capital coming in in kind of, you know, this market neutral position where, you know, in the U.S., we don't have this, but overseas they had these really,

you could call it like fat spreads and the basis between the spot and the futures price. And so you could kind of lock that in by going long spot shorting the future. And at that point, at one point it had gotten, you know, spreads had gotten out to like 50%. So I think there was a lot of capital that was coming in from, you know, hedge funds overseas that were coming in and taking kind of that like market neutral position and blocking in that spread there. So I think that was another driver of capital in, which now those spreads are almost entirely gone. I know some are actually in some exchanges are actually in backwardation. So I think those are two big drivers that had been bringing capital in as well.

And then just in general, you know, the kind of march of institutions coming into the space. on chain you can see that is that is really slowed you're just looking at you know you can identify whale entities which are considered like entities over a thousand bTC and that's been trending down since since late February early March as well so I think you know if if we're going to get this big second move up like second you know pump almost like similar to the 2013 I definitely think that you're going to see an uptick in those whales because that's been trending down since late February. At this point, you know, I don't think that retail really has the power to sustain an asset

of this size, where it did in, you know, 2013, obviously, and then also 2017. Because, you know, people like to throw out those statistics like, oh, if everybody in the world bought $10 of Bitcoin, price would go up like, yeah, but I don't see that as. completely realistic. I think you're going to need some larger institutional-sized players to, you know, send in capital to push this thing up, which, you know, depending on, you know, you ask some people that kind of boots on the ground, you know, like the Raup halls of the world, you know, they might be able to give you a kind of better perspective on when that capital may be coming in.

You know, perhaps it's just, it just takes time. And maybe we don't see that enter until Q3. Q4, but for now we have kind of seen this, at least on chain, this kind of plateau often even slight decline in the institutional capital coming in. Yeah, there are so many interesting threats and what you said there, but one that I would like to pull on is what you mentioned about how the sellers are, first of all, recent buyers, but they're also institutions, which I feel is against kind of the narrative that

was prevailing in crypto as these prices were going up which was, you know, the institutions are buying and that was led by companies like micro-strategy and Tesla. I almost said Microsoft. You wish, right?

But I was surprised what you said there, although the block recently did report just this week that a lot of these corporates that maybe had been interested that there isn't a lot of them actually in the pipeline now, you know, to follow in the footsteps of those companies. Do you think that downturn kind of coincides with the remarks on Twitter by Elon Musk about ESG concerns, you know, surrounding Bitcoin and environmental concerns, or is there any other kind of notable event that you feel coincides with when that shift happened?

Yeah, I think you bring up an interesting point there that, you know, there had been this big narrative that, first of all, like the institutions were going to dampen the volatility on both sides. And we were just going to go up forever, Laura. And we were never going to, you know, see any major correction. But I think when what Bitcoiners really didn't take into account was the impact that the derivatives have on the Bitcoin market. And you look at the size of when we were up, you know, in the 50, 60K range, the amount of liquidity that was in derivatives versus spot was just massive. And so when you had, you know, this big unwind on the way down, I think that really, I guess, enhanced or or, you know, of accelerated some of these moves that we saw, these big liquidation moves down.

And so I think to the upside as well, we have short squeezes as well. But, you know, I think a lot of this, you know, that big move down to, that original moved down to 30K, at least, you know, that was a long squeeze, right? So I think the leverage in the system, which isn't necessarily all bad because, you know, you need liquidity, but it is going to cause these big swings up and down. As far as like what is, you know, perhaps preventing this, you know, institutional capital to march in, I think, you know, first of all, just from like a price structure standpoint, I think if I was an institution, I'd probably be waiting for some stability and price. I think at this point, you have a lot of uncertainty in terms of, you know, the momentum because, you know, Bitcoin's obviously very momentum driven and a lot of that momentum has kind of been knocked out of Bitcoin. And so I think perhaps they're waiting for, you know, some stability in the price.

But also just like fundamentally, I think, you know, the whole Elon ESG thing, I think that did really put a damper on a lot of institutional opinions on Bitcoin and, you know, all the stuff that's been going on with China as well. You know, if you're looking from the outside in and don't really have a deep understanding of, you know, what that really entails and how that, you know, essentially is, long-term bullish for Bitcoin that you're seeing, you know, hash spread out across the world. You know, a lot of, a lot of these headlines are, you know, probably scaring off people that are looking from the outside in. So I couldn't give you, like, I don't know if it's one thing as well. Like it might be multiple, it might be like a combination of several things. But yeah, I would, you know, I do often wonder, is it just going to take them time, right?

because, like, you know, they have these really long processes that they have to go through. They're not like Sailor where they have, you know, the majority of their voting rights. And they can just make like a rash decision to just get to get a large Bitcoin position. I think even if they do, it'll probably be, you know, something like, like Square did. You know, they put like 5% of their treasury into Bitcoin. So I think you'll see something like that if it does happen. But, you know, the optimist in me says that it's coming Q3, Q4, but, you know, maybe not. But I think the ESG stuff definitely put a damper on that.

Yeah. So in a moment, we're going to talk a little bit about what the rest of the year will look like. But first a quick word from the sponsors you make this show possible. With over 10 million users, crypto.com is the easiest place to buy and sell over 90 cryptocurrencies. Grow your crypto with crypto.com earn, which pays up to 8.5% interest on your Bitcoin and 14% interest on your stable coins. When it's time to spend your crypto, nothing beats the crypto.com visa card, which pays you up to 8% back instantly and gives you 100% rebates for your Netflix, Spotify, and Amazon Prime subscriptions. Download the crypto.com app now and get $25 by using the code Laura. The link is in the description. Did you know nearly $338 million worth of the NFTs were sent last year? And in 2021, that number is growing faster,

than ever. If you're looking to make your first NFT, check out NIR's fast, scalable, low-cost, open-source platform. NIR is investing 80 million NIR tokens in community-led projects over the course of five years to power sustainable innovation through its ecosystem, with fundraising opportunities and support for DAWS and DAPs to engage fans and reach new audiences. Come learn why NIR is the infrastructure for innovation at N-eA.org. Back to my conversation with Will Clemente. So something that you tweeted, which was fascinating to me, was a chart showing that each cycle after a Bitcoin halving has three peaks of supply being held by short-term market participants.

So can you explain kind of what that means and, you know, how you extrapolate from that to this cycle? The takeaway here is that like you kind of have these hype cycles within the main. cycle of Bitcoin. And so, you know, Bitcoin is driven by, you know, new market participants. First of all, you know, you have the halving, which is almost like this push on Willie Wu. Like to analogize, it's like you're in a bath and you push the water in the bathtub and that gives it that initial momentum going. And then, you know, from there after that push, and, you know, the speculators come in and, you know, just natural human, you know, greed kicks in and people phomo into Bitcoin, drives it up, right?

But I think what that's really showing is like, yeah, you have these like many hype cycles almost within the main, within the main cycle itself where, yeah, each cycle you've seen these three very distinct peaks of what I was looking at is like the portion of supply held by the shortage of market participants. I think in the chart, it was like under three months old, I think was what I had highlighted. So yeah, it's showing right now at least. We've only had one peak versus, you know, the three that have taken place in the previous cycle. So I'm maybe, you know, maybe we don't have exactly that three number because, you know, granted, we only have two sample sizes. But I suspect it's going to be more than just one that we've had so far. And it appears now that we're still cooling off after that first big. hype cycle of shorter term holders stepping in, which, you know, once again, like we kind of mentioned

earlier, is also supported by the selling, the age of the coins that are moving on chain. They're all, once again, like, you know, shorter term market participants. I think in this space, a lot of times, it's beneficial to follow, you know, the smart money that's been in here in the space for a while because, you know, they've been through multiple of these cycles, they've been, you know, through multiple, multiple deaths of Bitcoin, when it seemed like all of those lost. Yeah. I think some guy actually created a website and it's called Bitcoin is Dead.com or something

like that. And he literally highlighted every time Bitcoin is dead and then the price, what it did from that time, which is pretty hilarious. But, yeah, I think when you, like, in my opinion, you should be following those experienced market participants. they're doing the complete opposite of selling right now. Everything on chain is showing that the longer term holders are actually accumulating right now. And there's a metric, you know, literally called long-term holder net position change,

which has been trending up for the last month plus really aggressively over the last couple weeks. And then also you can look at, so the way Glass node distinguishes like a long-term holder from a short-term holder is they have a threshold of 155 days. So, you know, the super smart folks over there, they did some, you know, statistical analysis and looked at once you get to that 155-day threshold, which is five months, the likelihood of the coins being moved back out of that wallet completely just drops off a cliff. And you can see this in, and they put an article out in their research section of their website if you, if you're interested in that.

So they have that cut off there for the long short-term holder thing. But what you've seen is that traditionally throughout the bull market is that the longer-term holders are scaling out while the shorter term holders, the speculators, are coming in and driving price up. And then conversely, in the bear market, you have the longer-term holders coming in and buying increasingly cheap BTC while the shortest-term holders move out of the market, right, because it's not fun. work as price isn't just going vertical. And so you see that in the previous two cycles as just kind of like an underlying, almost like the current driving the cycle, but

also in 2013 between the two double pumps, I would think we touched on this earlier, like the long-term holders are what set that floor in between the two pumps, where if you look at this chart, you know, the long-term holder, the supply

held by them had been trending down throughout the first pump of the two. And then in between that, when we consolidated for, I think it was like four or five months, then that was actually trending up while the short term holders moved out. And then in the second half, then the long term holders began moving back out once price started going parabolic again. And then the longer term holders once again, you know, moved in and the speculators came back in. And then, of course, we moved into the bear market and then longer term began accumulating again.

And then it very similarly too. In like late 2016, there was that same dynamic where the longer term holders had, you know, kind of stepped in and set the floor. So I think you can look at it two ways, right? Like if you have a bearish bias, you can look at this and say, yeah, well, this is what happens at the beginning of bear markets, right? Like the longer term holders, you know, they start buying. But conversely, and, you know, this is where I kind of stand is that we're in this more

or like mid consolidation where the longer term holders, they're actually setting the floor contrary to the fact that we're necessarily in a bear, which is like one of the other main things that I'm looking at to like distinguish the two is the number of new users coming on the blockchain. We're like usually at the end of the cycle after the big peak, you start to see those new users just kind of drop off a cliff and no new users. A lot of that is new speculators coming in are coming on chain. But we're actually seeing the opposite where the amount of new users has actually been going up,

especially over the last two, three weeks, which I think is twofold. First of all is people attracted by lower prices. Because, excuse me, an entity is not necessarily just a person, but it can also be a corporate treasury or an investment fund. It's just an entity. It's not necessarily determined by the size of their holdings. So that could be not necessarily, you know, it could be any cohort, but you are seeing new users coming on chain, which is contrary to what you see at tops. But I would be interesting to see how much of that is coming from Latin America. I know Glassnow tries to not cross the line of going between like the analytics side of things and the privacy side of things.

and the privacy side of things, which I think they do a very good job at, not kind of crossing that line, which kind of goes against the kind of ethos of big corners. But I would think it would be fascinating to see how many of that, how many of those new users coming on chain are actually from Latin America, because that kind of coincides with right around when, you know, the El Salvador announcement came out. So I think that that's really interesting. But, yeah, new users coming on chain.

And yeah, that's not any resemblance of the bear market. So we have kind of talked a little bit about how there tends to be these cycles. They usually coincide with the halving. You know, obviously if for whatever reason this time around Bitcoin didn't actually follow the similar pattern that it had established after the previous havings, that would be big news. that, you know, would probably be analyzed to death. But at this moment in time, what's your projection for how things will go in Bitcoin for the second half of the year? Yeah. So I think, like, one of the other things to look at is not only just the age of the, of the wallets, and kind of their, they're selling and buying behavior. And so Glass node,

not only did they have, you know, the long-term holders, but they also have something called a liquid liquid supply, which is looking at the behavior, you know, the selling behavior of the entities. And so for the entities that have a very low likelihood, statistically, of selling, like, not likelihood, but behavior tendency to sell, I think, I forget the certain threshold, but it's, they're labeled illiquid if they have, you know, under, I don't know, I'm just picking up in there, maybe like under 25%, they sell under 25% of their holdings. So when you look at those entities, they've been adding really heavily here versus that that all kind of got puked out when we had that big dump down.

But over the last couple weeks, not only is it long-term holders, but it's entities that have really no history of selling coming in and stepping in. And so I think that process of coins that kind of got puked out by those by the short-term holders and are now getting. scooped up by those strong hands, I guess you could call it. I think that process is just going to take some time. I think it, perhaps it takes another month from here before we really see higher prices. But I think that consolidation process of coins moving into, I almost like to think of it, like, you know, somebody spilled water on the counter, right? And you need a lot of paper towels.

And so like these strong hands, these are the paper towels coming in. and soaking up the coins, right? And so, like, you know, that process is just going to take, I think it's a matter of weeks at this point because I think we're starting to move in the latter half of that. But in that metric, I like to call it the strong term, the strong hands metric, Willie Wu calls it the Rick Astley indicator. That's starting to trend into really strong accumulation. And I actually worked with Willie to kind of create a variant.

of that, which is like a very simple ratio of comparing that liquid, the liquid holders to the liquid holders. And so what you see is that you have this movement right now of, you know, liquid to a liquid hands while price is going down. So like the ratio is turning up, price is turning down. And so for like anybody who's, you know, somewhat familiar with technical analysis, that's like a classic bullish divergence where you have. have the indicator making higher highs while the price is training down. And so the last time you saw that was in late January when we had that big correction after that first big blow off top.

And then in that dip was actually when Tesla bought. But that kind of gave us some juice on the way out of that dip. But you also had this the second big, I guess this bullish divergence where the oscillator had made a higher high while price had made a lower low. So once again, like in that, at that time, you had those strong hands come in and scoop up those coins and set the floor. So that, that looks very similar. And the bullish divergence now is a lot more clear than the one that occurred in January. But that, that's something I have a very close eye on. Also, also profit taking. So, you know, I think you've heard sober before. That's basically a metric that looks at

the profit taking of coins on any given day, created by on-chain analyst Renato. And so what you see in this is very similar where the profit taking has made a lower, I'm sorry, a higher low. So, you know, it had a really strong drawdown. And then it had another drawdown in the last week or so, but it didn't go as far down. So people didn't sell at a loss as much as they had in the first drawdown. So, like, to me, this is suggesting that, you know, the profit taking in terms of that, you know, people aren't selling it as a loss as heavily. And so a lot of that, a lot of the capitulation that was going to take place, people have already done so.

And so once again, like that, that oscillator is making a higher high while price is making a lower low, which is, once again, a bullish divergence. And coincidentally, this also happened in late January. same thing. But the last time there was a clear bullish divergence was in late January. So that's another interesting thing. All right. So I guess we see where we are in the mini cycle. All right. Well, this has been super informative. And yeah, we'll have to see where we end up by the end of the year. Thank you so much for coming and unconfirmed. Thank you, Laura. This is super fun. And I'd be happy to come on again. Yeah. That would be great. Don't forget. Next. is the weekly news recap. Stick around for this week in crypto after this short break.

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creating the first ever responsible data economy. Thanks for tuning in to this week's news recap. First headline, Bitcoin hash rate is moving out of China in a big way. According to data from the block, Bitcoin's hash rate crashed nearly 50% over the last month, coinciding with multiple regions in China moving to shut down Bitcoin mining. Notably, Xinjiang and Sichuan, the two top Bitcoin mining regions in China, cut the proverbial mining cord, taking an estimated 30% of the network's hash rate offline. China's decision to shut down Bitcoin mining has kick-started a hash rate migration, with Chinese miners

seeking to move Bitcoin mining equipment to more friendly jurisdictions. On Tuesday, a Chinese logistics firm decided to ship 6,600 pounds of mining equipment to Maryland, first reported by CNBC's Eunus Yun. Thomas Heller, chief business officer at Compass Mining, told CoinDesk, 3,000 kilograms sounds huge, but compared to the amount of miners that get shipped regularly, it's just a small batch. The secondary market for Bitcoin mining equipment appears to be flooded. Kevin Zhang, vice president of Foundry, reported that a calling based in China has over already, quote, shipped out over 20,000 ASICs in the last two weeks, adding that the great ASIC exodus will be anything but seamless. Hosting capacity outside China was already oversubscribed and scarce prior

to these regulatory announcements. Already, the implications of the minor exodus from China are being felt. On Monday, Bitcoin mining machine manufacturer Canaan said in a press release that its Avalon minor unit is already in operation in Kazakhstan. Kazakhstan is a country worth keeping an eye on as the Mining Haven competition heats up due to its proximity to China and cheap electricity rates. Following Kevin Zhang's logic about the possible oversupply of mining equipment, Bitmain announced the suspension of Bitcoin mining rig sales. Bloomberg reports that the price tag for a top tier rig has fallen 75% since April. The Block's data shows that Foundry, a subsidiary of Digital Currency Group,

saw the hash rate of its mining pool, Foundry USA, increased nearly 15% over the past month, shooting into the top 10 of mining pools worldwide. Other top pools, such as Ant Pool and F2 Pool, saw hash rate decrease 50% during the same period. Speaking of China, China bans crypto for the fourth time. The People's Bank of China released a statement on Monday that not only reiterated previous crypto bans, but additionally asked Chinese exchanges to investigate, identify and caught off any user accounts associated with over-the-counter crypto exchanges. The block reports that four institutions, including AliPay, issued a similar notice,

warning that any users found dealing in crypto transactions would see their account terminated and reported to the relevant authorities. The PBOC's words follow a similar may notice from three Chinese self-regulatory bodies, reiterating the 2013 and 2017 crypto bans on Bitcoin transactions and ICOs, making this week the fourth time China has banned cryptocurrency. Next headline. City Group launches a cryptocurrency business unit. On Thursday, Citigroup officially announced the Digital Assets Group, its new business unit

within its wealth management division, dedicated to the cryptocurrency and blockchain space, as reported by the block. The move comes after Morgan Stanley and Goldman Sachs launch their own crypto initiatives for wealthy clients to gain exposure to cryptocurrencies. Next headline. Microstrategie bonds trading below face value. On Monday, Micro Strategy announced the purchase of an additional $13,05 Bitcoin for roughly $489 million in cash, which equates to approximately $37,600 per Bitcoin. The latest Bitcoin acquisition come shortly after the company completed its $500 million offering

of secured notes last week. On Tuesday, CoinDesk reported those notes, which come due in 2028 and barren annual interest rate of 6.125% were trading at 97.75 cents on the dollar, meaning the bonds traded below face value. The latest purchase pushes Micro Strategies overall investment in Bitcoin to over $2.7 billion in cash, equating to an aggregate holding of 105,085,000 on the software company's balance sheet. While Microstrategy continues to go all in on its Bitcoin accumulation strategy, Frank Shapiro, director of news at the block, published an article that paints a dire picture for those waiting for other public corporations to join the ranks of hoddlers. One major obstacle to actual adoption is how Bitcoin is accounted for.

One source vented to Frank, quote, accounting is fucking brutal. No real company can take the generally accepted accounting principles earnings per share hit. The crux of the issue, notes Deloitte's Rob Macy, is that, quote, each quarterly reporting period effectively looks at the lowest, price that Bitcoin has ever traded at since its purchase and requires a write-down. For now, it appears that outside of Tesla, Square, and the few public corporations that have already purchased Bitcoin, the demand is just not there. Or, as an anonymous source from a crypto firm specializing in institutional customers put it, quote, new net-long positions from corporates

outside of micro-strategy are essentially non-existent. Next headline. Crypto-fundraising didn't slow, even as Bitcoin dipped below $30,000. Earlier this week, Bloomberg reported the venture capital raises that venture capital firms had invested $17 billion into the crypto industry this year, doubling the previous yearly record of $7.4 billion in 2018. And that $17 billion all came within the first six months of the year. The trend continues this week with several high-profile raises. And Dresen Horowitz launched a new $2.2 billion crypto fund, with plans to invest in a slew of companies across the blockchain and digital asset space. A16Z also announced that former Securities and Exchange Commission Director Bill Hinman

will join the firm as an advisory partner. Chainalysis, a blockchain analytics firm brought home $100 million in a Series E funding round that value the company at $4.2 billion, doubling its valuation in about three months. Co2 led the latest round. Amber Group, a crypto-financial services company, raised $100 million at a valuation of $1 billion in a series B led by China Renaissance. Michael Wu, the CEO at Amber, boasted, quote, cumulative trading on the platform has already doubled since the beginning of the year, increasing from $250 million to $500 million.

Blockchain Capital announced it had closed a new fund of $300 million and an oversubscribed raise that included, quote, strategic investors, pension funds, major university endowments, and family offices from around the world. Most notable amongst those are PayPal and Visa. Next headline, John McAfee found dead in prison days before U.S. extradition. On Wednesday, John McAfee, the controversial software magnate, was found dead in his prison cell near Barcelona. The Caudelaun Department of Justice said, quote, everything indicates that it could be a death by suicide. McAfee was awaiting extradition to the U.S., which that Spanish High Court had authorized earlier that day. McAfee had been detained in Spain last year on tax evasion charges.

In March, McAfee was indicted on several charges of money laundering and fraud, revolving around an alleged pump and dump scheme and multiple ICOs. U.S. attorneys say McAfee and his team would purchase all coins, promote them on Twitter, and then sell them once they had boosted the price. He also allegedly promoted ICOs without tax. disclosing he was paid to do so. Next headline. Crypto crime.

Blockchain Island and 69,000 missing Bitcoin. The Times of Malta published a claim that estimates nearly $70 billion in cryptocurrency move through the island when it first introduced its crypto-friendly strategy in 2017. One such method, a transitory period, gave crypto startups in major exchanges like Binance, permission to operate without a license for up to a year, quickly turning the country into the Wild West as an end. industry source put it. According to the Times sources, quote, Malta's act fast approach to attracting digital currency platforms to the island before the necessary laws were in place was among

the red flags facing the country. The news comes as evaluators from the Financial Action Task Force are considering placing Malta on its gray list of countries who are not doing enough to prevent financial crime. According to a Bloomberg report, two brothers who founded Afro-Crypt, a South African crypto exchange have disappeared, ticking up to 69,000 Bitcoin worth about $2.3 billion with them. Afro-Crip shut down in April, coinciding with Bitcoin's $64,000 all-time high, with a company citing a breach in its system. Soon after the supposed breach, the brothers, Raiz and Amir Kiji allegedly transferred their investors' money from company accounts through crypto-mixing services. Time for fun bits.

McDonald's and the market dip. With the latest drop in the crypto markets, as I discuss with Will, it looks like a few of our favorite crypto people might have to take some new jobs. For those of you listening on audio, my favorite meme on Twitter this week was when several of them posted about their new McDonald's side hustle as Bitcoin dipped below 30K. Frank Chaparro posted a selfie in a McDonald's head. And it looks shockingly legit and worn in. And he tweeted that he has some personal news to share with his followers, insinuating he's left the pen to pick up a spatula. Another McDonald's meme that made me laugh was Ryan Watkins's tweet depicting Michael Saylor wearing Mickey Dee's attire, addressing an imaginary customer saying, Bitcoin is a swarm of cyber hornets, serving the goddess of wisdom, feeding on the fire of truth, exponentially growing ever smarter, faster and stronger behind a wall of increasingly.

encrypted energy. And the customer replying? Right. Can I get a Big Mac with fries? All right. Thanks for tuning in to learn more about Will and his BTC by WC3 substack. Be sure to check the links in the show notes. It's up, everyone. The Unchained newsletter has switched from a weekly news recap to a daily blog in order to keep up with the crazy pace of crypto news.

Each morning, you'll get four to five quick headlines, a crypto meme or two, and a few recommended reads. Head to Unchainedpodcast.com and the signer for the email. newsletter is right on the homepage. You can also find the link in my Twitter bio. Unconfirmed is produced by me, Laura Shin, with off from Anthony Youne, Mark Murdoch, and Daniel Ness. Thanks for listening.