GM friends,
Touch grass might have been the theme of the summer so far, but is it time to step away from the lawn and lock back in?
Let’s start the news by looking at why bitcoin and the rest of crypto may now be warming up for a renewed period of bull market price action.
Here’s what’s in today’s issue:
- Sam shares his thoughts on the Bitcoin bull run being back, Telegram’s founder getting arrested, Kraken’s court ruling, Russia developing exchange and stablecoin plans & Cardano’s hard fork postponed.
- Crypto Portfolio update for week 28.
- This week on chain.
- This week’s trending coins by Rebecca.
Get a FREE $500 Bitcoin trading position on Bybit! Just use this link and click register to claim
Is the Bitcoin Bull Run Back?
You probably noticed an enormous crypto vibe shift over the weekend, as BTC climbed over the $64K mark and everyone flipped bullish.
Sure, crypto sentiment flips on a dime regularly but this feels substantial, so what’s behind it?
The primary factor at work is Federal Reserve Chair Jerome Powell’s address at the Jackson Hole Symposium on Friday.
During the presentation he struck an unequivocally dovish tone, indicating that interest rate cuts would be coming soon. He made clear that employment, rather than inflation, is now the Fed’s main concern, and delivered this key line:
“The time has come for policy to adjust. The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”
A second factor at play is political; as covered here, presidential contender Donald Trump has pivoted to a strongly pro-crypto position, and so a Trump win is seen as the most immediately bullish election outcome.
Then last week, the Trump campaign received a major boost when independent candidate RFK–who is also openly pro-bitcoin–announced that he is dropping out of the running in certain swing states in order to bolster Trump’s chances of winning, and that he is officially endorsing Trump.
And besides these factors, there is also our current position in the bitcoin halving cycle, which–if it tracks with previous cycles–suggests that towards the end of 2024 and into 2025 we should move into a period of upward price movement.
Add to that the fact that bitcoin funding rates are now reset close to zero, and the vibe shift makes sense.
But what do you think, are we nearing a big move up to new ATHs or are you more cautious about what comes next? Reply to this email and let us know your views.
Telegram Founder Pavel Durov Arrested in France
The founder and CEO of Telegram, Pavel Durov, has been arrested in France after his private jet touched down there to refuel.
Detainment is reportedly because the French authorities believe Telegram does not have sufficient content moderation and refuses to hand over access to user data (and if you’re thinking that doesn’t sound like grounds for arrest, don’t worry, you’re not alone), while reports also suggest the authorities are holding Durov personally responsible for any criminal activity that takes place on Telegram.
There has been an enormous backlash to the arrest, with prominent names including Elon Musk, Vitalik Buterin, and Vivek Ramaswamy (among many others) speaking out on the matter, amid claims that Durov could face up to twenty years behind bars if he doesn’t cooperate with the French authorities (which implies granting them private data access).
Relatedly, during an interview with Tucker Carlson broadcast four months ago, Durov claimed that in the US the FBI had attempted to secretly have a Telegram backdoor installed, and he also explained that despite having hundreds of millions of dollars in bank accounts and bitcoin, he doesn’t own large assets such as real estate, which seems logical if you suspect governments around the world–the kind of powers that sometimes seize people’s assets–might have a less-than-friendly interest in you.
It’s also notable that Durov left Russia and took dual French citizenship after refusing to comply with censorship demands in Russia, stating that his original home country was “incompatible with internet business”, but it looks now as though the French authorities are taking over where Russia left off.
Telegram is closely linked with the TON blockchain, and Toncoin experienced an immediate price drop when news broke of Pavel’s arrest, and is currently still down by around 17%.
TON has posted a statement fully backing Durov, free speech and decentralization, while Telegram has posted that it is compliant with EU laws, including the Digital Services Act.
Mixed Reaction to Kraken Court Ruling
In the ongoing legal battle between major crypto exchange Kraken and the SEC, a federal court has ruled against Kraken in its attempt to have the SEC’s case dismissed.
This goes back to last November, when the SEC charged Kraken with operating “as an unregistered securities exchange, broker, dealer, and clearing agency”.
So far, so SEC, but then Kraken filed a motion to dismiss the case on the basis that transactions on its platform don’t involve securities (the point being that crypto tokens are not securities), and it’s this motion that has now been dismissed by the court.
Which all looks like an initial victory for the SEC, and some headlines have taken this angle, for example stating “SEC Scores Massive Victory Against Kraken”.
However, at the same time Kraken CLO Marco Santori has posted the exact opposite on Twitter, claiming:
“This is a significant win for Kraken, for the principle of clarity and for crypto users everywhere. It also confirms Kraken’s long-standing position that it does not list securities”.
Santori’s argument is that–as in the famous earlier case between the SEC and Ripple–the conclusion here is that “a token isn’t a security, but agreements around a token could be”, and he believes that the SEC will not be able to satisfy the Howey Test (which indicates whether or not assets are securities) with regard to transactions on Kraken.
Russia Developing Crypto Exchange and Stablecoin Plans
Over in Russia, there are reports that the authorities are planning to establish two crypto exchanges, one based in Moscow and one in St Petersburg. Furthermore, a core purpose of these platforms will be to issue new stablecoins that will be linked to the Chinese Yuan, and to a basket of BRICS currencies.
This is according to a report in Russian business newspaper Kommersant, and it may indicate a desire to de-dollarize, while also providing a means of evading international sanctions and boosting economic activity.
Cardano Hard Fork Postponed
And finally, In slightly less heated and hectic news, a planned Cardano hard fork known as Chang, that had been scheduled to take place on August 27th, has been pushed back until the beginning of September.
In fact, Chang had already been postponed before that, having originally been expected in June, but Cardano founder Charles Hoskinson insists there is nothing to worry about, and offered a reason for the delay when he posted that, “Binance and a few others need more time to get their houses in order, so the rocket is going to wait on the pad”.
Week 28 Crypto Portfolio Update
Just holding and chilling. Nice to see markets making moves back up again. Portfolio still in the red.
See the 10x Portfolio breakdown and weekly history since inception HERE!
With Jerome Powell signaling a change of course at the Fed that will bring lower interest rates later this year, last Friday then saw an increase in US demand for BTC, with the Coinbase price premium (shown in green on the chart) spiking up to hit its highest level since July.
This metric tracks the difference between the prices of BTC on Coinbase Pro and on Binance, and can be used to get a measure of demand in the US as compared to around the rest of the world.
Also, the spot BTC ETFs had a very positive period last week, registering a further 8,213 BTC coming in, and to get a handle on how that compares to bitcoin production, miners last week added 2,250 newly-produced BTC to the number of circulating coins, meaning the ETFs collectively purchased well over triple the weekly mining supply.
However, taking a look over at the spot ETH ETFs, it’s a contrasting story as their slow start continues, with last week bringing outflows every day.
This meant the week in total brought $44.5 million in negative flows across all the ETH ETFs, which in turn puts the total flow since launch at negative $465 million.
That’s a huge difference from the start achieved by the spot BTC ETFs back in January, when they racked up total inflows of $2.77 billion in their first month.
That all said, the situation for the ETH ETFs may improve after Grayscale selling–from converted Ethereum trust ETHE–is done, and in fact, ETHE selling is continuing to occur at a faster rate than GBTC selling happened back when the BTC ETFs first launched.
If you’re hoping for a raging crypto bull run (and at this point, who isn’t?), then one factor to look out for is increasing stablecoin liquidity, and in that regard the picture is looking good across multiple metrics.
Stablecoin supply and the number of stablecoin holders are both on a largely smooth upward trajectory, and while the charts for stablecoins senders and transactions take a bumpier route, the long-term path is still up and to the right.
In the L2 arena there’s plenty of competition, and here are a couple of stats to make you happy if you’re an Arbitrum bull. Comparing all-time use on Uniswap, Arbiturm leads all Layer-2, with over $190 billion of cumulative volume over the last three years.
Additionally, if we look at monthly net bridge flows, then it’s almost all positive for Arbitrum One, which has not experienced net bridge outflows since August 2023, and is looking especially strong this year, while Base and OP Mainnet are also competing for traction.
Security is a constant concern in crypto, and a report this month from Chainalysis has discovered that 2024 is worse than 2023 when it comes to crypto crime.
According to the data published, cumulative hacking events have been rising faster this year, while the cumulative value stolen has been increasing at a steeper rate as compared to last year, and is currently approaching the $2 billion mark.
However, it should be noted that cumulative value is rising more quickly partly because crypto prices themselves are higher than they were in 2023.
We can also see that the types of target have shifted, as while last year saw more hacking activity focused on DeFi, this year so far there has been an increase in attacks on centralized platforms, accompanying a decrease in DeFi attacks.
Here are my key takeaways from the trends this week and the announcements have sure packed a punch!
- Toncoin is a Web3 ecosystem within Telegram messenger that’s dropped 16% after Telegram’s CEO Pavel Durov was arrested in France on multiple charges and is now facing 20 years in prison.
- Pepe is a memecoin that’s raised over $10 million for its Pepe Unchained token pre-sale. PEPU is now being tipped as the next 100x memecoin.
- Ethereum’s co-founder Vitalik Buterin has announced plans for an AI-focused day at its Devcon conference in Bangkok. Sony has also announced it will be launching a testnet for its Ethereum Layer-2 in the coming days.
- Simon’s Cat is a memecoin on BNB Chain that’s seen Binance announce support for its CAT airdrop for FLOKI token holders.
- Notcoin is a Telegram-based game that’s dropped 21% in 24 hours after news broke of Telegram CEO’s arrest.
- Bitcoin jumped 6% after Fed chair Jerome Powell announced interest rate cuts are on the way as it’s now time for policy to adjust. RFK Jr. has ended his Presidential campaign and backed Trump which is bullish for Bitcoin.
- Vulcan Forged is an NFT gaming studio that’s launched real estate yields on the Elysium blockchain.
- Sun Token is a DeFi protocol on Tron that’s hit a new all-time high of $0.04, its highest level since December 2021. This move comes after Tron launched its memecoin generator platform called Sun Pump.
- Bittensor is a decentralized machine-learning protocol that’s jumped 14% in the past 7 days as traders await the results of Nvidia’s quarterly results on August 28.
- TRON is a Layer-1 blockchain that’s up 20% in 7 days on the bullish momentum from its memecoin generator platform Sun Pump. Some FUD also came from Tron’s USDD stablecoin which silently removed $732M in Bitcoin collateral.
- Kaspa is a proof-of-work blockchain that’s seen investors rotate away from KAS and into Bitnance token BTN which is currently in its presale offering phase.
- Solana is a Layer-1 blockchain that’s seen its total-valued locked (TVL) reach 34.9 million SOL, the highest level since October 2022. SOL has also jumped 10% after Bitcoin’s price moved up. Solana’s next hackathon starts on Sep 2.
- Artificial Superintelligence Alliance is the AI merger between Fetchai, Ocean Protocol and SingularityNET. KuCoin has supported the token merger and Fetchai has unveiled its Innovation Lab which will see it commit $10 million a year to AI startups.
- PaLM AI is an AI chatbot using Google AI tech that’s been featured in advisor Alex Becker’s latest YouTube video.
- Brett is a memecoin on Base that’s been listed on Binance for futures trading and on the South Korean crypto exchange Upbit.
Thank you so much for your support, and I truly hope that today’s issue will give you insights needed to help you master your wealth.
If you are reading this it means you are on the free version of the Wealth Mastery Investor Report, which is great for news and tips on the crypto markets.
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See you next time!
Lark and the Wealth Mastery Team
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