Will Bitcoin Recover?
Why Is Crypto Going Down?
*We now are going to have a couple inflation prints coming up over the course of the next couple weeks that are going to be important.
*My hunch is you know everybody has tilted again on you know what we saw in the last couple prints. My suspicion if you look at Morgan Stanley Goldman Sachs the consensus view is that we’re still heading in the direction of 4% faster than I think people emotionally think.
*So, I would say there’s maximum uncertainty in the world. The fear that inflation is uncapped the way Larry Summers was articulate November and December is less today than it was. But what’s emerged is this idea that we’re going to have higher rates for longer and we’re going to have higher inflation for longer.
Now the question I throw back at you is the market abhors uncertainty.
* The markets done totally fine during periods where we had 3% inflation and 5.5% rates. When the internet boom that was you know 2000 to 2005 rates were a hell of a lot higher than the rates are today. So I don’t think that higher rates and higher inflation means that we can’t you know invest in venture back companies that have huge secular growth.
* The world doesn’t end. But what I do think it means is like if there’s massive uncertainty in the world if allocators of capital don’t know whether rates are going to double again whether inflation is going to double again then everything just shuts down. And that’s really bad for the economy. I don’t see that happening right now but I do think that the prints over the course of the next 8 weeks are going to be important.
So Brad said a few different things in that clip. Number one yes inflation is still really really high it is a lot stickier it’s not going down as fast as most experts thought it would. Number two speaking about the federal funds interest rate while originally the market was projecting maybe just one more 25 base point increase judging from these latest CPI numbers. The market is now projecting they’ll probably get not just one but probably a few more and then finally and this is what it all comes down to the issue for investors isn’t really are we high are we low the issue is that uncertainty.
*The markets done totally fine during periods where we had 3% inflation and 5.5% rates if there’s massive uncertainty in the world if allocators of capital don’t know.
* Now the next inflation data the next CPI report isn’t until March 14th with the next Fed meeting happening then on March 22nd 21st 22nd.
* I governing principle I think I probably said it too many times but I’ll say it again rates are going to be higher than we like and they’ll stay here longer than we want. And so I still kind of maintain that we’re probably going to have a 5.5% fed funds rate which means that maybe credits will offer me 7.5% soon on 3 month T. But we’re going to have higher rates and I do think Brad’s right though in the sense that as long as we know that then that’s it and we can forecast it into the future without a changing too much it’ll be okay.
* So this is an ongoing story the minute I get more information I’ll make a video I’ll keep you informed but breaking news coming out of the SEC. Binance US is operating an unregistered securities exchange says SEC officials the official spoke during a Voyager digital bankruptcy hearing. So as we know Binance US is attempting to buy Voyager digital assets in their bankruptcy but that’s being blocked because in a direct quote from the SEC staff.
* The staff believes they sold in the fact and circumstances currently known to the staff that the offering and sale of VgX tokens has the attributes of a securities transaction meaning they believe Voyager tokens are securities. But number two the staff also believes that Binance US is operating an unregistered securities exchange in the US.
*So that’s a huge revelation because if the SEC staff believes that Binance US is an unregistered securities exchange that basically means that every exchange in the US is probably the same. The official noted that the SEC staff’s views don’t necessarily reflect the views of the five commissioners at the head of the agency.
* So this isn’t an official ruling from the SEC they have to wait on the five commissioners to make their ruling but typically an enforcement action by the SEC is started by the staff but needs a majority of commissioners to vote in favor to then proceed. Upon hearing this news Binance US did issue an official statement they said it is regrettable that an SEC staff member would make allegations that Binance US and platforms alike ours are operating as an unregistered exchange. Without specifying the assets listed on our exchange that the SEC considers to be securities which is totally fair. Binance is saying tell us which cryptocurrencies are the unregistered securities we want to comply tell us so then we can then have some clarity.
* They continued by saying we along with others in our industry remain committed to constructive dialogue with regulators and supporting a comprehensive regulatory framework drafted and passed by Congress to ensure innovation continues to be a part of the system. And that continues in the United States.
*Yes. So they’re also saying by the way SEC you don’t make laws Congress makes the laws you’re just the enforcer. We don’t want regulation by enforcement but we will listen to a comprehensive regulatory framework drafted and passed by Congress. Before we talk about tether I do have some good news to share with you galaxy digital tips Bitcoin NFT market to hit 4.5 billion by 2025 meaning galaxy digital is bullish on Bitcoin ordinals Bitcoin NFTs.
*And although we did do an interview explaining to you what are Bitcoin NFTs what are Bitcoin ordinal NFTs as a quick reminder Bitcoin NFTs or ordinals have attracted significant attention since the ordinal protocol launched in late January enabling users to inscribe data such as images PDFs videos and audio onto individual satoshis the smallest unit of a Bitcoin.
* And in a direct quote from galaxy digital’s research report they said while there are notable differences between inscriptions and NFTs it’s fair to say that a native on chain ecosystem friend of T’s has emerged on Bitcoin in a way that was never possible before and its usage has been exploding.
*So here was that page from the research report there was the bear case the base case and the bull case and even if Bitcoin NFTs just stay a niche sort of trend they still think a 1.5 billion dollar market cap for the full thing and obviously a whole lot more if it becomes as popular as a theory of NFTs or even more popular if you like Bitcoin you do not need to own a Bitcoin ordinal but feel free to join us at Bitcoin 2023 in Miami use code altcoin daily for 10% off your ticket prices do increase in about five days so link down below check it out. And then finally many of you have been asking about tether stable coin issuer tether used bank accounts opened with falsified documents in the past according to the Wall Street Journal.
* So the Wall Street Journal reported Friday that tether used bank accounts in the names of executives in very of various companies slightly tweaking those companies names to maintain its access to the global financial system back in 2018.
*So this was over four years ago it did already happen according to the Wall Street Journal of course tethers chief technology officer refused these claims the chief technology officer of tether tweeted on Friday afternoon that the Wall Street Journal report contained a ton of misinformation and inaccuracies without giving specifics but as an investor in crypto I wanted you to be aware of what’s happening. Lets see in next article