This editorial is from last week’s newsletter, Week in Review, with some slight tweaks to dates so the article makes sense. Subscribe to the newsletter to get this editorial the second it’s released, which also includes the biggest stories of the week and a comment on each story.
One Week Ago, Bulls Continued Their Parade
The bullish price action last week made CT an exuberant, happy place. Two of the most interesting positive prognostications were about altcoins and memecoins. Miles Deutscher pointed out that the entire altcoin market cap is reaching the top of a six-month trading range, which, if it breaks out, could be big. Ansem, a well known Solana-based KOL, posted a bold memecoin price prediction list for this cycle whose highlights include $WIF topping out at a $100 billion market cap. When asked where this would put Solana’s market cap, he answered $1 trillion. Aspirational!
Two weeks ago, financial macro news in the form of the Fed’s 50 basis point cut bolstered the crypto market. Will the macro news out of China last week do the same? China’s central bank introduced its most aggressive stimulus package in four years, aiming to revive the country’s struggling economy which is expected to miss its 5% 2024 growth target. The measures include monetary easing (interest rate cut and lower reserve requirements), support for real estate (existing mortgage rate cut and loosened rules for owning second homes), stock market support (a mechanism for a potential $500 billion in central bank-backed buying of stocks), and hints that further fiscal stimulus is incoming. All of this will unleash liquidity into the market. This should be a boon for Bitcoin and crypto as one of the most sensitive assets to liquidity, if not the most sensitive.
For the last bullish news of last week, I bring you some stablecoin signals. If you are not tracking the inflows and outflows of stablecoins, you must begin immediately. It is one of the best indicators for the health of the market as it correlates well with money entering or exiting the crypto market. Money in, prices go up; money out, prices go down. As can be seen from this overview of average stablecoin supply, from May through July, stablecoin growth was flat to slightly positive. From August into September, there has been a noticeable uptick.
Finally, for some less-than-bullish news from the world of politics, U.S. presidential candidate Kamala Harris’ brief comments on blockchain and digital assets were met with mixed reactions by the crypto industry. None were funnier than Hayden Adams, creator of Uniswap and CEO of Uniswap Labs, publicly appreciating Kamala’s statement. The pithiest reply was by Eric Conner, who said, “She’s literally suing you lol.” Harris’ anodyne rhetoric strikes me as the usual positive, vague political pandering, and echoes similar language used by Biden in 2022. Color me unimpressed
