| | | Good afternoon. Bitcoin is seemingly moving $1k every hour today. Coinbase’s website is reportedly crashing from a rush of traffic. Meanwhile, ETF volumes are going completely parabolic. No big deal, right?
Just one of those days… | Today’s Big Stories:
🚀 All-time high not too far away
👎️ SEC’s revolving door | Today’s free newsletter is brought to you by atato Custody – The First Licensed & Audited Custodian with No AUM Fee | Today's newsletter is 844 words, a 3-minute read. |
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Y’already Know |
On days like today, it’s hard to conjure up anything else other than stating the obvious: Bitcoin is on a tear. |
Since our last email a week ago, BTC has jumped ~20%. |
The momentum accelerated this AM when BTC moved a causal $3k (~5%) by the time I could finish my morning coffee. |
That’s it, really. That’s the story. All eyes are on bitcoin right now. Prices hit $64k just before Coinbase started having issues, which somewhat halted the momentum.
Either way, we haven’t been at these levels since November 2021 and we’re only about ~10% away from all-time highs. If we pass the $69k milestone soon, it’ll be the first time in history bitcoin will hit an all-time high before it’s halvening event, which expected to happen in April. |
Uncharted price territory may be closer than we all thought. |
ETF Update: |
It’s becoming increasingly obvious that the new ETFs are having an immediate impact on bitcoin’s price. The stats are wild: |
BlackRock’s IBIT keeps hitting records: Yesterday the ETF hit a record daily inflow of $520 million. That’s 5% higher than the previous inflow record set on February 13 and a number that eclipses the total net inflows that were registered on Monday for all U.S. spot ETFs combined. Demand isn’t only coming from institutions: There were more individual trades yesterday in the bitcoin ETFs than there were in the S&P 500 ETF (SPY) and the NASDAQ (QQQ). Unparalleled supply and demand mismatch going on: As we discussed in the past, this type of demand cannot be ignored. The spot Bitcoin ETFs are buying approximately 11.17 times more BTC per day than the daily issuance. |
| Wow... (Data from Feb. 27.; h/t to @HODL15Capital) | | | | Feb 28, 2024 | | | | | | 579 Likes 110 Retweets 15 Replies |
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Crypto’s Deal With the Devil |
One of the most disgusting aspects of the American government (and there are many) is the revolving door between regulators and the regulated. |
An individual could one day be walking the halls of the Department of Defense as a government employee and the next as a lobbyist for a defense contractor. |
Or, as seen in a recent study, between 2004 - 2020, 32% of FDA employees left to go work in the very industry they were regulating. For the CDC, that number was 54%. |
It’s simple… |
Put in a few years intensely (one might say, overly) regulating an industry by creating impossible to follow rules that force companies into fault… Then go work at that company to maneuver those same convoluted laws that you put in place. |
And while large companies can pay for this protection racket by either hiring these previous regulators or the law firms they now work at, smaller companies can’t compete. Roman from Tornado Cash, for example, has had to resort to asking for donations for his legal defense. |
The entire ethos of crypto is to give back the power to the individual, yet here we are as an industry having to contend with the very same issues. |
Case in point: Last week, Ladan Stewart, an 8 year SEC veteran who led the SEC’s crypto enforcement unit, has left the agency to join the law firm White & Case. |
While at the SEC, Stewart litigated against companies such as Ripple and Coinbase. Now, she will be a partner in the law firm’s white collar division where she will develop a crypto defense practice. |
Talking to Bloomberg Law, Ladan said: |
“Crypto is here to stay—that’s become very clear with the launch of a slew of Bitcoin ETFs… Given the complexity and the turbulent enforcement arena, legal questions surrounding crypto are going to be at the forefront for some time.” |
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Oh, the hypocrisy! |
And in the press release announcing her hiring, Joel M. Cohen, Global Head of White & Case's Global White Collar Practice stated: |
“Ladan's most recent role as the head of the SEC's specialized crypto and cyber litigation unit is a significant asset given the heightened regulatory scrutiny of the crypto industry in recent years. Ladan is extraordinarily well positioned to counsel crypto industry players and defend them against regulatory or private actions." |
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Ladan joins a cadre of previous SEC officials now working for the crypto industry. Steven Peikin for example was previously co-director of the SEC's Division of Enforcement from 2017 to 2020 and now represents Coinbase on behalf of Sullivan & Cromwell. |
Conflicting Feelings |
We want the crypto industry to be provided fair rules and regulations that they can adhere to. Instead, the companies face regulation by enforcement, or worse, vindictive lawsuits. |
But for an industry that supports the opting out of the traditional financial system, we are having a very hard time opting out of the rent-seekers system. |
Once again, the regulators aren’t doing what is best for the consumer, but what best lines their pockets. And crypto is having to contend. |
Over time, this regulatory capture will result in a poorer outcome for the consumer. Remember, SBF was within inches of having his way with regulators. |
We don’t blame Coinbase and other companies for having to play the cards they are dealt. But, we can and should point out the issues with it. |
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| The all-time high Bitcoin exchange rate is not $69,000 - that was in 2021 dollars. For a true all-time high we'd need to break ~$79,000. | | | Feb 28, 2024 | | | | | | 1.34K Likes 146 Retweets 97 Replies |
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| BTFP expires in March.
BTC halves in April.
RRP runs out in May.
All around the same time. So, the US banking system gets stressed right as Bitcoin gets scarce. | | | | Feb 28, 2024 | | | | | | 1.26K Likes 219 Retweets 59 Replies |
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