Professional Investor Report - August 2022

Professional Investor Report - August 2022

We'll start by addressing the elephant in the room; The current bitcoin drawdown has lasted 294 days.  We are currently down 72% from the all-time high.  2014, 2018, and 2019 bear markets lasted on average 330 days.  Peak drawdowns during those times hit 85%.  That being said, price action does not kill innovation and adoption.  We will review some indications of such trends.  Today we have investors accepting volatility and deploying capital into a down market.  We will present some data to show why, based on historical trends, it might be a great time to do so.

TL;DR (Too Long; Didn't Read)

  • BlackRock offers institutional clients a bitcoin trust. $10T * 2% = a lot
  • The Federal Reserve sends letters to banks asking about "Crypto-Asset-Related Activities"
  • FOMC meeting minutes show more interest in how digital asset markets affect traditional markets
  • Well understood models attempting to predict the bottom of a bitcoin market cycle have hit, indicating a potential bottom
  • Small buyers continue to purchase bitcoin and appear to be unphased by price
  • Lending Rates increase as illiquidity continues
  • Large accounts that hold more than 1,000 bitcoin have been accumulating like mad
  • Ethereum is updating and 245,000 bitcoin is locked on their network

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