In This Issue

• The state of the market, everything is dead, NFTs pumping again, 1inch upgrade, tax loss harvesting & Taiko airdrop.
• Rebecca breaks down the latest news.
• REKT has a TA report on Litecoin and Bitcoin.

Crypto Alpha Report

Friends, the New Year is almost here… Let’s hope it’ll be better than 2022! 😅

I just wanted to remind you that on the 2nd of January we release the Crypto Alpha Report, the resource where my team and I give you an overview of the crypto market and put the best airdrops, altcoins, NFTs & DeFi farms on your radar!

This report will give you everything you need to stay on top of the opportunities that constantly occur in the markets!

Get yourself access to the report on a FREE 7-day Trial!

Sign up now and expect the report in your inbox on the 2nd of January… Enjoy ✌️

What’s On My Mind by Lark

The State of the Market

We made it to the end of the year. Finally! 

2022 was an incredibly difficult year for investors. No safety anywhere. Multiple bankrupt platforms trapping billions in customer funds. Major coins like LUNA completely collapsed. The FED keeps pushing up rates thus wrecking equity markets. Fear remains high. Lots of stuff can still break markets. 2023 is generally anticipated to have a lot of challenges and many are still calling for lower lows. 

No one truly knows what is going to happen in 2023, but I am preparing for chaos while hoping for the best, or at least a decent bear market rally! 

Flexibility will be key in 2023. 

At the moment, Bitcoin is about to put in a death cross on the weekly as the 50 week crosses under the 200 week. Not awesome. The trend line (orange) has become closer though with it now resting around 24k. Volatility has basically dried up as well. Since the FTX collapse the price of BTC has not moved more than a few percent up or down. Now is a time for caution because high volatility often comes back in dramatic ways after periods of low volatility. 

But hey, at least Microstrategy bought another 2,500 Bitcoin. 

Oh, and in case you didn’t get the message last time I warned about it, then please disable any 3commas APIs. It has been confirmed that they have been compromised with the hacker publishing 10,000 keys. This is not a drill, disable any 3commas APIs NOW or risk losing your funds. 

Everything Is Dead

The kind of sentiment and general market action that tends to coincide with a deep and brutal bear market is that everything is dead. And to be clear, a lot of coins will die. But sectors and narratives will not. Here are a few examples of what I am talking about. 

• Multiple crypto companies have filed for bankruptcy 
• Metaverse market sales are down 96% in 2022. 
• NFT sale volumes have cratered from 140 million a day, to 20 million. 
• Defi total value locked has plummeted from 180 billion to 39 billion, with some chains losing almost 99% of money in defi. 

I could add another 20 examples of how crypto is dead. 

But guess what? This is not new. This is the exact kind of sentiment that we saw in 2018 and 2019. Pessimism was through the roof. Everything was dead and would never recover. No new narratives would ever develop. No new users would ever come. This was the long slow death of crypto from which we would never recover. There would never be new highs ever again. 

And everyone who said that was wrong. 

Betting against crypto is betting against the exponential rise of technology. 

NFTs Pumping Again 

Was it that Fidelity has filed for a trademark for an NFT marketplace? Maybe. Or maybe everyone is just bored so they started pumping penguin pictures. Collections like Pudgy Penguins and Sappy Seals are making big moves. Although major collections like Bored Apes have only seen small gains, and Crypto Punks remain flat. So, don’t get too excited and think that a new NFT season is about to kick off. It is however a reminder that gains can be made all over the crypto market if you are looking.  

Oh, and China announced that there will be a regulated NFT platform launching on January 1st. That could bring a lot of attention to the NFT market. 

1inch Upgrade 

Defi protocol 1inch has rolled out their Fusion upgrade. This does two big things for end users. First, you will be able to place custom orders without any gas fees! BIG! Second, 1inch will protect users against MEV, AKA front running by bots, so that you will get the best swap prices. 

Tax Loss Harvesting 

For many of you reading the end of the year will be the end of your tax year too. So it may be a critical time to consider locking in some tax losses to perform a tax loss harvest. This is where you get to offset gains with losses. If done right then you may have almost no tax bill or even a tax credit for 2022. Although credits can often be capped. Tax loss harvesting is about mitigating losses, and in an already tough year a little less pain on your final tax bill might be welcome. 

Things to consider 

• Dumping losers. If you have a coin that has little chance of coming back then dumping it now could secure that loss for tax purposes and reduce your tax bill. 
• Buying back. I know what you are thinking. You bought Bitcoin at 60k, and now are thinking you can sell and lock in a huge loss and thus pay no taxes and then buy it all back on the first of January. The wash-sale rule dictates that you should wait at least 30 days to rebuy a position. Although you may be able to sidestep that using wrapped Bitcoin or Wrapped Ethereum. Otherwise understand the risk of waiting 30 days. Maybe you can buy more than you sold, or maybe the market rallies leaving you on the sideline. 
• You need to make sure your jurisdiction actually allows for this. 

Tax loss harvesting isn’t pretty. But it can soften the blow. 

Taiko Airdrop 

A ZK-rollup Ethereum equivalent layer two protocol called Taiko is “probably” doing an airdrop to early testers. To be eligible you will need to take the plunge and get involved in the public testnet. 

• Step 1 – Get testnet tokens here.
• Step 2 – Bridge some tokens over here. 
• Step 3 – Transfer funds back and forth between accounts. You will need two wallets. You might want to repeat this step every week or so. 
• Step 4 – Run a node, details.  

Questions? Then check out their Discord. 

Reminders. Never give anyone your private keys. You might not get anything. If you do get something it might be worth nothing. It is a testnet so it is free to use. 

In Case You Missed It by Rebecca

Crypto market news

Famous investor, Bill Miller, still sees Bitcoin as a huge opportunity, explaining “anybody can afford to lose 1%” of their net worth. Source

Stablecoin settlements reached over $7 trillion in 2022 so far, with expectations for 2023 to surpass Visa, Mastercard, American Express, and Discover. Source

Coinbase has published a report predicting an extended crypto winter for altcoins and will see investors turn to “higher quality names.” Source

Argentina’s football league has partnered with metaverse platform, Upland, to take the league virtual. Source

Caroline Ellison and Gary Wang have pled guilty to fraud charges relating to FTX. Source

Twitter has added a crypto feature that enables users to view Bitcoin and Ethereum prices with the search bar. Source

Guggenheim’s Scott Minerd who was known for his crazy Bitcoin predictions has died from a heart attack at the age of 63. Source

British Columbia becomes the third Canadian province to limit crypto mining operations, imposing an 18-month ban on new connections to the power grid. Source

Sam Bankman-Fried has been extradited to the US and been released to his parent’s home on a historic $250M bond. Source

Fidelity has filed three metaverse trademarks to be able to offer financial services in virtual worlds. Source

Nexo has terminated its potential acquisition of troubled crypto lender, Vauld, citing Terra losses, Indian seized assets, and funds stuck on FTX as the reasons. Source

Hong Kong has launched a Web3 accelerator called G-Rocket, with the aim to help 1,000 start-ups within the next three years. Source

Japan’s Financial Service Agency (FSA) is set to lift the ban on foreign stablecoins in 2023. Source

Bitkeep’s wallet has suffered an $8M hack that stole assets including BNB, USDT, ETH, and DAI. Source

Coins and Projects

Bitcoin’s volatility index has hit an all-time low of 11.46, much lower than the levels seen in the bear market in 2018 and early 2019. Source

450,000 Bitcoins have left exchange reserves for cold storage in 2022, shrinking the supply on exchanges to less than 12% of the total supply. Source

Bitcoin miner, Core Scientific, has filed for Chapter 11 bankruptcy. Source

CoinCorner has partnered with Pouch to bring instant remittance payments to the Philippines using Bitcoin’s lightning network. Source

Bitcoin hashrate has recovered after temporarily falling 38% as US miners turned off operations due to the storm. Source

Bitcoin exchange outflows have dropped to a 7-month low, as investors regain confidence in centralized platforms. Source

Ethereum has been removed from crypto platform, Paxful, due to its move to proof-of-stake and increased centralization. Source

Uniswap has partnered with MoonPay to allow users to buy crypto with a debit card, credit card, or bank transfer. Source

Binance has joined the US lobbying group, the Chamber of Digital Commerce, after the exchange has been criticized for being unregulated. Source

Binance CEO, CZ, addresses the reason for the Binance FUD and says it’s primarily down to external issues rather than the exchange itself. Source

Polygon has launched the second testnet for its zkEVM making this the final step before its mainnet launch. Source

Polygon has partnered with Mastercard and neo banking app, Hi, to launch a platform that allows users to create a personalized, Web3-focused NFT debit card. Source

Solana NFT projects DeGods and y00ts are moving away from the network and heading to Ethereum and Polygon. Source

Avalanche has rolled out its Banff 5 software upgrade to introduce direct communication between its subnets. Source

Fantom will focus on dApp ecosystem expansion in 2023, as explained by Andre Cronje in a Medium blog post. Source

1inch has launched its Fusion upgrade to improve swap security and profitability. Source

Defrost Finance on Avalanche has suffered a flash loan hack that liquidated $12M from the platform. Source

Paxos has recovered $20M in Paxos Gold (PAXG) tokens that were taken in the FTX hack. Source

Ren DAO has voted to mint 180M tokens to fund its new version. Source

Macro news

The IRS is to delay the $600 payment platform reporting threshold to 1 January 2023, calling 2022 a transition period. Source

The US Federal Election Commission (FEC) has approved the use of NFTs for campaign fundraising efforts. Source

India’s Central Bank Governor has said the next financial crisis will come from cryptocurrencies if not banned. Source

Russia is set to legalize crypto for international trade in January 2023. Source

The President of Brazil has signed a crypto bill into law legalizing it as a payment method. Source

The European Central Bank (ECB) has published its second report on a CBDC and will review the findings of its investigation in late 2023. Source

Wells Fargo has been ordered to pay a record $3.7B in fines and refunds for illegal activity. Source

Russia’s largest bank, Sber, has issued its first gold-backed digital financial assets (DFAs) and considers them to be a “great alternative” to investments amid de-dollarization. Source

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Market Analysis by Rekt Capital

Litecoin (LTC/USD) and Bitcoin (BTC/USD)

On the top is the LTC/USD chart and on the top is the BTC/USD chart.

In April 2015, LTC bottomed following the 2014 Bear Market.

And if we disregard the long downside wick in January 2015 as the BTC bottom, then the next bottom would be the one in August 2015.

In this scenario, LTC bottomed 4 months prior to BTC’s bottom.

And it’s interesting how LTC rallied prior to its Litecoin Halving (purple vertical on the LTC chart) whereas BTC consolidated; and when LTC consolidated post-Halving, BTC began its uptrend.

But in December 2018, both LTC and BTC bottomed at the same time, evidence for resynchronisation between the two assets. When BTC rallied, LTC rallied, and when BTC dropped so did LTC.

However, we are seeing that desynchronisation is occurring once again, as LTC is showing signs of having enjoyed a June 2022 bottom, whereas BTC is still arguably searching for its own.

If indeed LTC has bottomed in June 2022, then it has been at least 6 full months since the BTC bottom (assuming the BTC bottom isn’t in yet, which is still plausible).

So based on the tendencies of 2015, it could be the case that LTC will climb while BTC drops or at the very least consolidates.

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Final Notes

Don’t forget to check out one of my newest YouTube videos: 7 Big Crypto Predictions For 2023

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.

If you really want to take advantage of fastest growing asset class EVER, I highly recommend you join us in the Premium Investor Report.

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• Deep dive Altcoin report & The Trending Coin Report
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Don’t forget that on the 2nd of January we release the Crypto Alpha Report, giving you everything you need to stay on top of the opportunities that constantly occur in the markets!

Get yourself access to the report on a FREE 7-day Trial!

Sign up now and expect the report in your inbox on the 2nd of January… Enjoy ✌️

See you next time!

Lark and the Wealth Mastery Team

Legal Disclaimer

TCL Publishing ltd (director Lark Davis, owner of Wealth Mastery) is not providing you individually tailored investment advice. Nor is TCL Publishing registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. TCL Publishing is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.

You can find a full disclosure of all my crypto & venture investments here.