Weekly Rundown - February 18, 2024

Light drop this time

Listen to this post:

Did you get my February 14, 2024 update?

Get it now. In that update, I looked at some metrics, discussed a problem with 1-3% allocations that nobody’s talking about, and gave you an easy, low-risk, high-reward ETH/BTC trade.

Also, make sure you got my trade alert from Monday.

I also tweaked my plan and altcoin reports, as stated in yesterday’s post.

That’s a lot of posts in a week. Not a normal week!

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Maybe I’ll do a short market update this week to give you a break. I have the monthly issue coming soon and an altcoin report, too. Plus, those two trades to monitor.

I guess we’ll see how it goes.

Scroll down for a poll and some content you may enjoy.

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See below. Which option is more likely?

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Bottom line: huge banking interests asked Congress to let them into the crypto game. They say today’s rules make that too hard, and the growth of non-bank crypto-native entities undermines the safety and stability of the US financial system. Only they can make it right.

My take: with the launch of ETFs, US banks see how much money they can make from providing custody for crypto and financial products with crypto rails. They want a piece. Once they get it, this will be one more reason for your friends and family to think “it’s safe now” and put some money in. I don’t know if that will come in this cycle or the next one (however you define “cycle”), but they’ll keep trying. Banks become allies when they see crypto as a source of profits rather than a threat to their business model.

Why you should care: adoption comes slowly, then all at once. 

I see a lot of chatter about how the market will go much higher because 69% of bitcoins haven’t moved for more than one year.

If the market goes higher, it won’t be because of HODLers. Their bitcoins don’t matter for price. Price is a function of buyers and sellers. It’s more impacted by the 31% of bitcoins that move, not the 69% that don’t.

Moreover, those 69% of bitcoins can hit the market anytime. It’s as easy as tapping “send” and “sell.”

To use a metaphor: more than 90% of beds have not moved in more than a year. This has nothing to do with the price of beds.

Paul Tudor Jones pitched Stan Drunkenmiller with the argument “when bitcoin went from $17,000 to $3,000, 86% of the people that owned it at $17,000 never sold it.”

By that logic, you could say, “bitcoin’s price has to fall because 86% of people HODL it.”

In December 2023, 71% of bitcoins hadn’t moved in one year. Since then, the number of HODLers fell but the price went up. One has little to do with the other.

Put HODLing behaviors in context with other behaviors. It’s a crucial piece of information that helps you understand and appreciate your circumstances.

Don’t read anything more into it than that.

Bottom line: IntoTheBlock gives bitcoin an 85% chance to hit all-time highs within the next six months.

My take: that analysis sounds as good as any. Why wait six months? Why can’t we do it in six weeks?

Why you should care: it’s fun reading on a slow Sunday (or Monday, depending on where you live). It’s always nice to get a fresh take on an old topic.

Relax and enjoy the ride!

I’m looking to finalize my next list of sponsors!

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