4 reasons why crypto has exploded in 2023.
🧵
1/ Since Jan 1:
- Crypto market cap is up 28% to 960B. - BTC is up 28% to 21,200. - ETH is up 34% to 1,600. - SOL is up 200% to 24 !!
Why? 🤔
2/ Reason 1: good inflation numbers.
The CPI for Dec 2022 fell to 6.5% (year-on-year).
JP Morgan's trading desk expected anything less than 6.6% to be bullish for markets. We got that.
3/ There's more.
Consumer prices fell 0.1% in the month of December.
In other words, we got DEFLATION.
We haven't seen a MoM deflation of 0.1% since Q2 2020, when the world locked down for COVID-19.
4/ But that's not all!
Here's the real magic:
If you add the MoM numbers together, we saw consumer prices rise roughly 1% over the past 6 months.
IF this keeps up for another 6 months, we get a yearly CPI of ~2%, which is actually the US Fed's target!
Magic. 😂🍻
5/ Reason 2: FTX recovers 5B in cash and liquid crypto.
Incredible as many investors/VCs had written off their entire holdings to zero 💀
Great news for investors, VCs & crypto projects. 💰
Initially, it was thought FTX only had 1B in liquid assets:
6/ Reason 3: Confidence in Grayscale and DCG?
Since Dec 28, the discount for Grayscale's BTC shares (almost 50% off!) have rapidly gone down.
Even Morgan Stanley is buying.
Genesis (owned by DCG) still owes creditors 3B, but maybe the big fish knows something we don't...🤷🏻♂️
7/ Reason 4: Relief from Mt. Gox sell-side pressure.
Liquidators just pushed back the deadline for creditors to decide how they want to be paid.
i.e. Gox users dumping up to ~137,000 BTC on the open market (bought for less than 500!) is now a can kicked down the road...😅
8/ Is the bear market over? 👀
Not according to historically reliable economic indicators, e.g. US bond spreads.
Still, some good short-term trading opportunities for sure.
See my YouTube video from yesterday. NFA.
3 Reasons Why Crypto is Exploding -- Is the Bull Market Back?
9/ Shoutout to @Stepnofficial for giving me the incentive to get outside for a walk every day and earn crypto.
Made a good ~40 GMT while brainstorming this thread! 🍻😀
This post is based on this twitter thread.Comments
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