Did you want to be like Laszlo Hanyecz?
If you want to make a financially unsound choice and pay for the yearly subscription newsletter in crypto, YOU CAN!
Now accepting crypto payments for a 24 dollar discount, but not DOGE for apparent reasons. Check it out here.
After reading the infamous article from The Wall Street Journal, “ Why Software Is Eating The World.” by Marc Andreessen, I thought about what the next step in innovation would look like. Has it reached the pinnacle? or is this just the tip of the iceberg?
Andreessen’s article is now a decade old, written in 2011, and the amount of growth from these sectors was almost prophetic. Describing the future of industries and how daily internet users would reach 5 billion in a decade- the actual number is 4.72 billion- makes you wonder if this guy came from the future.
But…
From all of this disruption of traditional markets, what sector has come away unscathed? Banks
Yeah, I always rag on how terrible banks are. What’s new, right?
Here is what is new.
The May crypto crash was a 42% total loss of capitalization across all cryptocurrencies; Accounting for over 1 Trillion USD wiped off the table.
Every leveraged speculator was offset with a collateralized surplus. All of the popular DeFi applications had zero downtime. All stablecoins stayed pegged to a dollar while having billions in volume. There was no need for government regulation and no bailouts being paid for by the American people. All the overleveraged people lost money, and that’s it.
Let’s compare this to 2008.
The estimated cost of the 2008 mortgage crisis was 12.8 trillion to American taxpayers. This figure is a little under half of our current deficit of 28.2 trillion. The most considerable bailouts were given to banks, who were a significant cause of the entire problem.
Families began buying houses they couldn’t afford due to banks trying to secure more loans to use as derivative capital. The goal was not to make sure they were sound mortgages but to get as much capital to trade with. The revolving door of unsound mortgages used as capital slowly came to a stop as homeowners began missing payments on the overextended home they purchased or refinanced. After paying their CEOs and upper management millions of dollars in bonuses in 2007, nothing was left to cover the upcoming crash.
In 2006 Freddie Mac paid a $3.8 million civil penalty to the Federal Election Commission to settle charges. It had used corporate resources to stage 85 fundraising dinners that raised $1.7 million for candidates for federal office. These entities are supposed to foster a growing class of homeowners, not rake in profits for shareholders. The ripples of these actions by government-sponsored mortgage companies such and Fannie Mae and Freddie Mac are still felt in the current economy.
Nothing changed. The national average sale of a listed home in today’s market is 43 days and selling over the asking price by 11.2%.
We are losing trust in our system.
Defi software and contracts are eliminating this greed. They automate the financial market for a fair allocation of risk that is always over collateralized.
So, who else is on the menu? Banks have been out to pasture grazing on the American people, and this next decade, the software will eat them too.
The volatility is real. The relief rally is slowing down. Consolidation before the next leg looks probable. Here’s some news.
Mark Cuban Invests in Ethereum Scaling Solution Polygon
Billionaire investor and owner of the NBA’s Dallas Mavericks Mark Cuban has invested an undisclosed amount in Polygon, an Indian crypto startup working on improving Ethereum’s scalability.
CoinDesk confirmed the news shortly after Mark Cuban Companies listed the crypto project as an investment.
Known for his criticism of Bitcoin in the past, earlier this year, Cuban said that BTC is “a better alternative to gold.” He also revealed that his personal crypto portfolio comprises 60% Bitcoin, 30% Ethereum, with the remaining 10% accounting for several other smaller altcoins.
He has been a much more active voice in the crypto community in this cycle, frequently appearing on various podcasts to discuss his interest in the industry. Read More
Grayscale GBTC and ETHE Premiums Back at Highs
Grayscale’s GBTC and ETHE premiums have risen to two-month highs.
The premiums for ETHE jumped from negative 11.3% to 12.3%. Meanwhile, the GBTC discount declined by 14.4%, from negative 18.2% to negative 3.8%. These levels had not been seen since the last week of March.
The leading catalyst for the sudden rise is the recent launch of Simplify U.S. Equity PLUS GBTC ETF, which invests 85% of a portfolio in stocks and up to 15% in Bitcoin via GBTC.
The recent dip in Bitcoin’s price, along with the discount on GBTC, has likely also made the asset more appealing to high-net-worth. Market analyst Ben Lilly of Jarvis Labs noted to Crypto Briefing that “there’s accumulation taking place with rising balances,” suggesting returning demands among institutional investors. Read more.
Ray Dalio Owns “Some Bitcoin” as an Inflationary Hedge
Ray Dalio, the billionaire investor who presides over the asset management firm Bridgewater Associates, says that he holds Bitcoin.
Speaking to Michael J. Casey at Consensus, Dalio added that he’d rather own Bitcoin than a bond in an inflationary environment.
The veteran economist has recently shown positive interest in the cryptocurrency, conceding that he “might be missing something” about Bitcoin.
Dalio’s latest update on Bitcoin came in January when he weighed up Bitcoin’s benefits as an inflationary hedge. Bitcoin’s maximum supply is capped at 21 million, which is what underlines its digital scarcity value proposition. Until today, though, he’d never confirmed that he owned the asset.
Dalio told Casey that he fears a repeat of the 1970s era stagflation when the rise in asset prices was fueled by monetary stimulus rather than organic demand and supply. Read more.
That’s all for the free weekly Crypto Crier. If you enjoyed this article, please like and share. If you have any questions, please leave a comment, and I can answer your questions further. As with all of my writing, this is not financial advice and is my opinion. I cannot stress enough how important it is to do your own research on all financial endeavors. I hope that these newsletters can help investors realize the current financial systems’ downfalls and usher in a more equitable system without middlemen.
Let’s build something together.
Tell your friends and family. This newsletter is targeting entry-level education for possible crypto investors. With more people understanding digital assets, we can finally progress to better systems. 🗣️
If you enjoyed this article, please consider subscribing to my paid newsletter, which includes daily analysis of my top picks and setups for entry/exit positions—all of these extras for the price of taking me to lunch.