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0 sats \ 2 replies \ @ExponentialBTC OP 4 Jun 2022 \ on: Blockware Intelligence Newsletter: Week 40 | Blockware Market Intelligence bitcoin
Summary
  • The Fed began quantitative tightening this week for the first time since the nearly disastrous QT period of 2018-19.
  • We examine the relationship between the expected Fed Funds Rate by year-end and the issues this could create in a modern monetary system that is historically over-leveraged on credit.
  • The equity market is behaving as though QT and rising interest rates have been priced in, but only time will tell if the true bottom is in.
  • The White House is looking to address Bitcoin Mining energy usage and New York is pushing forward a Bitcoin Mining ban. However, bitcoin ASICs emit 0 greenhouse gases. Miners are electric accountants (moving money) just like Tesla's are electric vehicles (moving people).
  • Hash Ribbon metric is close to crossing. It would signal the initial phase of a miner capitulation if it does.
  • Some miners (RIOT and CBTTF) are selling Bitcoin revealing miners are on the verge of capitulation.
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0 sats \ 1 reply \ @ExponentialBTC OP 4 Jun 2022
The last time the Fed underwent QT was for a period from 2018-2019. The result was that the Fed overshot their tightening goal, which spiked yields and nearly caused a bear market and recession.
Standouts from a price structure standpoint to me are: CIFR, BTCM, BKKT, MOGO, CAN, SDIG and MSTR.
Several of these names are showing signs of accumulation greater than BTC itself. As of recently, we’ve seen what I believe to be institutional front-running. For example, MSTR flashed strong signs of institutional accumulation on 5/26 (discussed here last week), and then 4 days later BTC did the same thing.
To me this looks like funds building equity positions before they make their Bitcoin purchases in order to double-profit. This makes monitoring the prices of crypto-equities even more important as it can potentially provide insights into institutional BTC buying behavior.
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0 sats \ 0 replies \ @ExponentialBTC OP 4 Jun 2022
Bitcoin Mining
Early Friday morning, New York lawmakers passed a bill that would ban any future Bitcoin mining operations not using 100% renewable energy. As of now, the bill is moving to the desk of the governor who can sign it or veto it.
In hindsight, it won’t matter if the bill gets vetoed. Nobody is going to set up a facility there after legislation like this almost gets passed.
This now places New York and China in the same tyrannical jurisdiction bucket. Embarrassing.
The White House is “teeing up policy recommendations to lower cryptocurrency mining’s energy consumption and emissions footprint,
Trying to restrict Bitcoin miners will only incentivize them to build operations elsewhere.
The recent downward difficulty adjustment and falling hash rate appear to be weighing on the hash ribbon metric. The moving averages haven’t crossed yet, but another sharp price decline would potentially force a significant number of old generation ASICs off the network.
While we haven’t had any severe form of miner capitulation yet, it’s something to keep an eye out for as that has historically marked clear Bitcoin price bottoms.
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