nrd525 Market Tracker

[nrd525]

Reviewing the Blockfi reddit, it seems like a lot of people have totally discounted the two main threats to stable coin (and also crypto) lending - a hair cut coming from a flash crash, and hackers.

I was also concerned to learn that Blockfi has accidentally sent out approximately 700 BTC in users as rewards. They sent out BTC instead of USD(c)!

Also bitcoin did a double bottom style bounce off of 31.2k (after 30k 4-5 days ago).  We could even flash crash as low as 14k if this is a bear market.

I've placed modest sized bids from 20k-25k.

[nrd525]

Anyone who thinks a country (except for ones run by very crazy maniacs) will adopt bitcoin or any other unstable cryptocurrency as their legal tender in the next ten years is a very bad analyst.

Any journalist who uncritically writes such articles is a bad journalist (see Coindesk, El Salvador).

Legal tender also means you'd be OBLIGED to use it for small transactions which would be a complete nightmare.

[TheQuin]

Legal tender also means you'd be OBLIGED to use it for small transactions which would be a complete nightmare.

I'm not sure that will be the case depending on exactly how they legislate it. Generally, it means you'll be forced to accept it to settle debt. Assuming they also keep the legal tender status for the US Dollar then everyone can still choose to use that.

Reference: https://www.investopedia.com/terms/l/legal-tender.asp

Legal tender is anything recognized by law as a means to settle a public or private debt or meet a financial obligation, including tax payments, contracts, and legal fines or damages.

In general, legal tender can take two fundamental forms. A government can simply ratify a market-determined commodity money, such as gold, to be legal tender and agree to accept tax payments and enforce contracts denominated in that commodity. Alternatively, a government can declare an adulterated commodity or valueless token to be legal tender, which then takes on the characteristics of a fiat currency.

[nrd525]

https://www.khou.com/article/news/nation-world/el-salvador-bitcoin-legal-tender/507-8e0d51d7-57c2-467a-ab6c-d8deda101c8d

“Every restaurant, every barber shop, every bank....everything can be paid in U.S. dollars or Bitcoin and nobody can refuse payment,” Bukele said in an hour-long social media hangout with thousands of U.S.-based Bitcoiners as the bill was being debated Tuesday night in El Salvador’s congress.

I highly doubt this is going to work.  Maybe this is like my local government, where they pass laws that they have only the weakest plans of enforcing?  I think the goal is to get publicity and attract Bitcoin businesses and rich people to the country.  So they are pretending you will be able to spend your bitcoins on services.  But it's a lie.  The Lightning Network is only barely being used.  Doing main on-chain transactions would be crazy expensive.

The only way this would work is if there was a centralized system where you could convert your fiat into bitcoins, give it to the merchant, and then they'd convert back to fiat within say 1 minute so there wouldn't be any exchange rate risk.  It'd be centralized and fiat based and the bitcoins would just be for show.

If the government decides to take on the risk of the volatility, they are setting themselves up for a very risky bet on bitcoin that could cost them billions of dollars.

[STT]

Would be interesting how its implemented because of the variance in Bitcoin value.  Will be interesting to see the problems and solutions encountered in a normal population especially physical goods.   To pay small amounts and pay immediately its not a massive deal so long as the fees to transact are similar to cash which is possible because this is an expense for business normally that isnt always popular; I'd probably resort to a tab or account solution where you transact in set amounts and pay out of that running credit.
   The bigger problem is the whole system of payment for order, business to business where an invoice is given and time taken to pay off that bill, days weeks even and the price altering alot during that time could be upsetting and costly possibly.   What would have to happen is a fair amount of hedging which is not abnormal for some but a small business doesn't normally engage with forex hedging costs and operations, if its conveniently done and efficient its not a problem .

Price is upto a monthly average now which helps put it back at the top of range where as it had fallen to the bottom quite recently.   Possibly its broken some down trend or is challenging such inertia well now.

[nrd525]

Delta variant is bad and probably going to hit the US hard. I'm hoping the US federal government steps up with huge economic incentives (like $500/dose) to get everyone vaccinated.

The propaganda about bitcoin being "green" and using a lot of renewable energy is grossly exaggerated. It's bad for the environment, which is true of most human activities. The truth is somewhere in the middle -- bitcoin mining is bad, but so is gold mining and methane from cows.  We need a $200+/ton carbon (and methane equivalent) tax.
https://www.coindesk.com/why-chinas-ban-on-crypto-mining-is-more-serious-than-before

[nrd525]

Bought 1 ETH at $3080. I might diversify into ETH as it's becoming very well established and used.

[nrd525]

I gave up on trying to buy bitcoin at 20k-25k. Oh well, the good news is that it's going up! 

I lost $150 on yield farming at Dinoswap, as I managed to buy the top.  I think there is some money to be made early on in yield farming in general, especially if there is a rewards program for liquidity providers (and you can dump the tokens ASAP). But in general, I've got better ways to make money and also am busy trying to get the 2020 census data properly mapped.  And in general it seems like yield farming is based on complex schemes to create tokens that reward the creator(s)/developer(s and early users. But as the actual use case for most yield farms is minor, and the fundamental returns for liquidity providing are closer to 10% APR (I'm guessing about how much impermanent loss you'd have in say a USDC/BTC pool) - you generally cannot earn more than this rate, without being involved in some kind of weird scheme that is likely to collapse.

There isn't a use case for having more than 3-10 uniswaps.  And they should compete with each other and drive the fees down to near zero (just like exchanges, though in practice we've seen some resistance from this on the exchanges and they continue to make super profits).

[eth9888]

Any updated views from you on BTC / ETH?
Are we in crypto winter or is this is start of a second run to ATH soon?

Thanks.

[nrd525]

Jan 2022 US recession. US lockdown (a real one). Protests. Riots.  Stocks/crypto crashes (crypto maybe 30%-50%).  Stimulus package. Republicans sweep 2022.  Fiscal cutbacks (republicans only like stimulus when they are in charge).  2023 recession. Republicans sweep 2024.

Assuming this new covid variant is highly transmissable, might make the vaccines ineffective to very ineffective, and is equally or more dangerous to our health - I'm hoping it is more transmissable but significantly less deadly.

[nrd525]

Bitcoin flash crashes to 41.5k.  I think it could still crash into the 30k-40k range.

In retrospect, I think the US is going to favor "freedom" (aka disproportionately Republicans following an anti-science cult dying, and unfortunately a lot of immuno-compromized and old people who took the vaccine but it had limited effectiveness) over mandates and lockdowns.  And possibly to an extent that we don't go into a recession, even though Omicron is currently forecast (on Metaculous) to increase at 25%/day faster than Delta.

https://www.metaculus.com/questions/8756/-per-day-growth-rate-of-omicron/

The good news is that there is a likelihood (according to Metaculous) that Omicron is less lethal per case (though probably more lethal once you take into account the increased number of cases).

[nrd525]

The next move down might occur when the studies are out on how quickly Omicron spreads (possibly twice the R value of Delta.

[nrd525]

It's interesting how the lag on data reporting impacts Omicron. With a doubling speed of 2.5 days (varying a lot by country/region), if you have a 7 day lag it can easily go from 1% to 7% of your cases.  So while the US CDC last reported the US at 2.9% (Dec 5-11), as of Dec 17 we're probably at 20%-30% and we're heading to a fast 50% by Dec 20 (ish).

The next big CDC Nowcast release, which will likely show us to be at around 20% of cases, will be on Tuesday.  It might impact markets.  I'm thinking about putting in some low bids for Ethereum (and possibly Polygon and some others???).

https://covid.cdc.gov/covid-data-tracker/#variant-proportions

[nrd525]

Jan 2022 US recession. US lockdown (a real one). Protests. Riots.  Stocks/crypto crashes (crypto maybe 30%-50%).  Stimulus package. Republicans sweep 2022.  Fiscal cutbacks (republicans only like stimulus when they are in charge).  2023 recession. Republicans sweep 2024.

Assuming this new covid variant is highly transmissable, might make the vaccines ineffective to very ineffective, and is equally or more dangerous to our health - I'm hoping it is more transmissable but significantly less deadly.

So this wasn't 100% accurate. That said 2022 Q1 GDP US growth was -1.4%.   Bitcoin fell from 60k to 16k (>70%). And now we're expecting a 2023 US recession.

There was definitely a lack of lockdowns (probably due to the Omicron variant being a lot less deadly - something I hinted at, but at the time we didn't know until several weeks later when we had more data from South Africa, and protesting/riots. And the Republicans only had very modest gains in the 2022 midterms.

[nrd525]

November 2018 to March 2019, bitcoin bottomed at 3200-4000.  I'm wondering if one or more large actors were front running the 85% retracement?  So we never hit 3000.  
Previously we had a flash crash that was the bottom (or really two flash crashes in Jan and August 2015).  That year we spent most of the time at $300 (ish), but flash crashed to $170 (depending on the exchange).

I'm wondering if we have spent enough time from Nov 2022 to Jan 2023 for this to be the "bottom" of the cycle?  It seems like it might not be enough time.  So this move from 16k to 21k might be fake breakout.

I think the US GDP growth for 2023 is likely to be near zero.   Will crypto prices front-run the recovery?  (Will stock prices front-run the recovery? - It might be the same question if they are strongly correlated).

If MtGox is a good precedent, the FTX bankruptcy (and others, like Celsius) can drag on for many years without overly adversely affecting price.

There are always more scams that need to be identified and collapse. So the fact that some scammy projects are still ongoing - we could still have hit the bottom.

[nrd525]

The next crypto bull market, if there is one, might be seriously muted compared to priors. Ex. bitcoin/eth/etc may not surpass their ATH.
Prior bull markets went 38x (2011 vs 2013), 18x (2017 vs 2013) and 3.5x (2021 vs 2017).  Comparing the peaks.

Recommended videos:
https://www.youtube.com/watch?v=CQHD8bB-Rok

https://www.youtube.com/watch?v=ou9i-zfZVvk

[uknowy9999]

The next crypto bull market, if there is one, might be seriously muted compared to priors. Ex. bitcoin/eth/etc may not surpass their ATH.
Prior bull markets went 38x (2011 vs 2013), 18x (2017 vs 2013) and 3.5x (2021 vs 2017).  Comparing the peaks.

Recommended videos:
https://www.youtube.com/watch?v=CQHD8bB-Rok

https://www.youtube.com/watch?v=ou9i-zfZVvk

thanks for your update!

Are you still holding BTC/ETH or at the moment out of the market? What is your strategy for 2023?
Appreciate your input

[nrd525]

I was thinking about buying more BTC and ETH (and possibly some Polygon), but then I saw a chart of the US M2 monetary supply. In 2020 it increased by 20%!!!  The rise from 8k to 69k was (probably?) mostly explainable by that.  That's unprecedented (and an over-reaction by the so-called conservative Trump presidency).  With rising interest rates and tightening US M2 supply now, and the likelihood of a very small recession - I'm hesitant to buy back in.

I'm liking this channel and also the Glassnode channel.
https://www.youtube.com/@intothecryptoverse

(I'm also watching Tone Vays go off the deep end on politics and science - and embrace the extreme right).

I'm tempted to buy Trump NFTs, but I probably mostly missed the boat on that.  They've gone from $100 to 0.5 ETH (currently $900 USD).

At 28k BTC we're at an interesting position. It's either the start of a new bull market or a fake breakout.  I mostly hope it is fake, as I want to buy back in at < 20k - ideally once it's clear that the US is in a recession.  Though it'd also be fun if bitcoin pumped to 40k+.

I'm wondering if Dogecoin will become an alt-right/extreme right meme coin backed by Elon Musk (he's moving relatively quickly to the far-right politically)?  If so, will this be bullish or bearish?  I suspect it might be bearish at first - as the Dogecoin community is more centrist or possibly even liberal than the typical US resident.

[nrd525]

Bought 1 btc at 30220.

Does Coinbase transactions CSV not show all your buys?  I'm 90% sure I bought some bitcoins on Coinbase once in 2020 Fall and once in Jan 2021 - but I don't see them listed!  I checked other sites I use and I don't see purchases there. Also I sent coins from Coinbase at two points (probably to Blockfi or Celsius to lend them) right after I'm 100% sure that I bought them.

[nrd525]

I bought 15 ETH at 2070.