dienify

Morgan Stanley set to allow advisors to offer spot bitcoin ETFs to some clients... 2 ETFs at this point - IBIT & FBTC. via @Hugh_Son

Bottom Is In, New Highs Imminent $BTC had a great run off the lows with a strong bounce back into the range, I think we are on our way back to ATHs for a few reasons, given this I went long a bunch of $ETH and $TON, my biggest leveraged trade ever, lets talk it out! Price Action/Market Structure: Over the past 2 weeks we've seen significant crypto weakness vs equities which had me quite worried, but finally yesterday we got the Mt. Gox headline which seemed to provide a reasonable explanation. Insiders were front running the news of billions worth of BTC being distributed to creditors, there are some great threads including one by Galaxy Digitals Head of Research @intangiblecoins that goes through this in depth. TLDR they think it will be less sell pressure then the market expects. The Gox headline pushed us down to the range lows and we swept them - this lead to a decent chunk of around $300M in long liquidations. This was nothing crazy vs some of the liquidation events we saw in March/April (three different 24hr periods of >$750M in liqs) but the market has cooled off substantially since then in terms of altcoin open interest, funding rates, options skew, and some general altcoin carnage. So given that, this was a pretty big wipe out. Sentiment/Where we are in the cycle: Crypto Twitter sentiment is literally the worst I've ever seen it with BTC less than 20% off ATH's. That is because most crypto native participants who stuck around from 2021 saw how much alts outperformed majors like BTC/ETH and attempted to front run that this year. But so far the structure of this market has been very very different then in 2021. The new money coming in to the market this time was primarily - Front running the ETF (was first applied for by Blackrock in June 2023 at $26K BTC) - Actual flows into the ETF +$14.3B so far All of this new capital flooded into BTC which has a very low natural drip into altcoins (due to the profile of BTC holders and ETF buyers + no DeFi, slow, bad ux, etc) This combined with so many high profile projects who raised money in 2021-2023 that hadn't launched tokens yet lead to a massive wave of low float high FDV launches (+ one million different memecoins) which have caused massive dilution given all the new capital was flooding into BTC and not altcoins. This is VERY different from 2021 where you had stimmies, lockdowns and retail going crazy bidding alts! You also had very firm breaks of previous 2017 ATHs (20K BTC and $1400 ETH) to reignite retail interest in crypto + a ton of leverage in the system via under collateralized lending, LUNA and FTX. Currently the level of degeneracy, leverage, and retail interest is no where close to where it was in 2021. These factors have lead to most crypto native participants getting completely shredded since March with BTC only down 15% (myself included, thank you $BANANA and some lucky trades for saving me from being +50% down or more - currently down ~30-35% from March/April highs) I think this has lead to sentiment being trashed and people thinking "its over" where in reality the ETFs are just getting started. For some hope, I think alts will do well once/if BTC and ETH firmly break their ATHs. IMO this should reignite retail and fund interest. Additionally, I think the ETH ETF will be significantly more positive alts then the BTC ETF was, due to ETH's reflexivity (read my pinned post if you want a deeper explanation). Fundamentals, just heating up: Blackrock has $17B in IBIT and at a 25bps fee they already make ~$45M a year of this ETF, potentially forever - and it just launched 6 months ago! Capital allocators are slow moving and the sales engine at Blackrock is just starting to gear up. Blackrock has been applying to put a 1% IBIT allocation into some of their larger funds. If 1% becomes the global standard allocation to Bitcoin we have A LOT of inflows to go. A great selling point from these firms is "if you don't have 1% in BTC your essentially short / underweight BTC". This begins to flip the "career risk" from owning BTC to not owning BTC, a massive paradigm shift. Anecdotally I was speaking to a higher up at one of these big traditional asset managers in Canada who offers a BTC product and he said (paraphrased): "I don't understand Bitcoin but you got to own 1%, its like how I didn't originally understand the hype around tech stocks (like the mag 7) but you just needed to own them." If BTC continues to appreciate and Blackrock captures more market share they will be making hundreds of millions in perpetuity off of this product. We have seen Larry Fink constantly shill BTC on TV and you have a ton of structural macro trends that support Bitcoin. What I've said about the BTC ETF I think is fairly consensus from the typical chad BTC optimist. But where I feel like CT is super disconnected is on the ETH ETF. ETH ETF expectations are in the gutter, people worried about ETHE outflows and Kang is fudding the bottom. In reality what Kang says is partly true, it was also true 6 months ago when ETH doubled from 2K to 4K. But what ultimately matters the most is current positioning vs what actually happens and flows! Blackrock just had their most successful product launch EVER which will likely net them 100's of millions in revenue FOREVER and you think they are not going to put the full weight of their sales force behind their ETH product too? The ETH ETF is likely a higher margin product for them, throw on the 25bps fee and then later add in staking and clip ~10% off that (another 30-50bps!) making this potentially 2-3x more profitable then the BTC ETF. Larry is already getting the RWA's on-chain ready, he is going to come out full force shilling this thing. I'd guess less than 5% of people in TradFi know the difference between BTC or ETH or the real intricacies of SOL vs other alt L1s. If Larry + his salesforce is again on TV telling everyone this is digital oil or the world's decentralized financial ledger it is going to get some flows, and almost certainly exceed current expectations. That's why I longed a ton of $TON and $ETH, lets see what happens! $ETH vs $BTC also looks very good. Massive shoutout to @qthomp for chatting this + more through with me yesterday and getting me even more bullish at the (so far) stone cold bottom, he is a must follow! /END, none of this is financial advice, just sharing my own opinions and thought process.

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