Is The Current Bitcoin Bull Run Real?

The Ark Innovation ETF, $ARKK, had its best performing month ever in January – with a lot of its performance likely due to its $COIN holdings. 💯

How well did ARKK do in January? +28.82% good.

During an interview with Yahoo! Finance, Wood was asked whether the market is witnessing a bear market rally or if things have changed.

She said, “… effectively the bond market is saying we don’t have an inflation problem, and the Fed is probably close to the end of this move. Last year, we did have, as you call them, bear market rallies, and they were pretty powerful…”

Wood continued, saying that Fed Chair Powell ended the rallies by repeating the Fed’s belief that inflation is not under control and hikes would continue at 75 bps. ⬆️

Bear market or bull market, how have the Coinbase purchases performed? Let’s look:

Pretty damn well. 

But Wood isn’t the only big player in the crypto space. $MSTR‘s Executive Chairman, Michael Saylor, remains an ardent Bitcoin bull. 

MicroStrategy reported earnings yesterday and posted an impairment charge of $197-ish million due to its $BTC.X holdings. 

It doesn’t sound pleasant, but Q4 started with Bitcoin near $19,000 and ended near $16,500. Bitcoin is currently trading at around $23,300 at the time of writing.

Saylor and MicroStrategy CFO Andrew Kang repeated that the company would continue to acquire, hold and grow its Bitcoin position during the earnings call

Saylor reiterated during the call that MSTR continues to outperform the major indices and tech companies like $AAPL, $MSFT, and $GOOG. 🤯

$BTC.X‘s performance has been spectacular over the past few months – enough to create some theories by big named analysts. 

Accumulation?

Well-known analyst Willy Woo reported his theory in a Twitter thread that stablecoin inflows and on-chain activity during certain hours suggest that institutions in the U.S. and Europe are responsible. 🐂

This recent rally coincides with a new pattern emerging of stablecoins flowing into exchanges during work days only. Seems to me like the heat signature of large institutions doing the buying. pic.twitter.com/VZuoL4de9U

— Willy Woo (@woonomic) January 31, 2023

Additionally, Woo believes that the spot market (buying the ‘real’ thing on an exchange) is leading the derivatives market:

“Since this rally began, spot flows are dominant and leading over derivatives. It’s spot buying that’s moving the price and derivatives that are lagging. “

Manipulation?

While Woo sees Bitcoin’s resilience from many hands, someone else sees a single or few hands involved, similar to 2017. 🐻

The University of Texas McCombs School of Business’s professor John Griffin sees something different. 

According to McComb’s School of Business, Mr. Griffin’s research areas are asset pricing, empirical methods, international finance, and investment management.

So, clearly he is someone who knows what the hell he is talking about. Just read his Is Bitcoin Really Untethered? article. 

In a nutshell, and this is exceedingly overly simplified, Griffin was one of the few professionals in finance who identified the sneaky and shady parts of Bitfinex and the stablecoin Tether ($USDT.X).

According to Yahoo Finance and Fortune, Griffin and his coauthor (Shams) “… sifted through an incredible 200 gigabytes of trading data, equal to the troves that the Smithsonian Institution collects in two years, and followed sales and purchases from 2.5 million separate wallets.” 😱

Griffen hypothesizes that the same shenanigans in 2017 – 2018 are happening again, with one or a few big players agreeing to support Bitcoin at certain price levels. 

Who’s right or wrong?

No clue. Like anything involving trading, investing, or analysis, data from all sides is important to consider. 

We’ll update you if any further information/analysis comes from Woo or Griffin.

The table below is the current (February 3, 2023) staking yield rates of the top ten Proof-Of-Stake cryptocurrencies by market cap. 

Staked % is what percent of the total supply of that cryptocurrency is currently used to earn staking rewards – sometimes called ‘Lock-Up.’

The Lock-Up Period is how long crypto must stay staked before you can withdraw it and/or any rewards earned. 

Nominal Yields are the rewards listed, whereas Real Yield is the expected return when factoring in other costs, factors, or changes like inflation rates (not listed). 

It should also be noted that calculations and factors for Real Yields can vary substantially from one week to the next. Additionally, the Nominal Yield may have an expected range but is not guaranteed. For example, Polkadot’s ($DOT.X) Nominal Yield is advertised/listed between 8% to 14%. 

Another factor to consider is that the rewards are not in US Dollars but in token/crypto your stake. Staking Cardano ($ADA.X) rewards you in ADA and so forth. 

This table is updated weekly. 

Source: www.stakingrewards.com

Staking on Chainlink’s blockchain was activated on December 6, 2022 and data is still pending.

$DOT.X and $BNB.X continue to offer the highest Real Yields. 

DOT saw a fairly big jump in the % staked while $ALGO.X saw a drop. 

$ADA.X continues to show a negative real yield.