← Coin Stories with Natalie Brunell
Coin Stories with Natalie Brunell
News Block: Bitcoin Rebounds Above $114K Ahead of Fed Rate Cut & Big Tech Earnings, U.S.-China Trade Deal Looms
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In this week's episode of the Coin Stories News Block powered exclusively by Ledn, we cover these major headlines related to Bitcoin, macroeconomics, and global finance: Bitcoin Price Bounces Before Big Macro Week Fed Expected to End QT and Cut Rates...
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Welcome to the Coinsories News block, powered exclusively by LEDN. I'm Natalie Brunel and in about 10 minutes or less I'll provide you with insightful updates on bitcoin, financial markets and the global economy. Everything you need to know in one block. Let's go.
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Bitcoin is really finding its legs after the large deleveraging event a couple of weeks ago. It has shown impressive resilience since then, rising back above 114,000 on Sunday. Bitcoin is bouncing into what's sure to be a big week when it comes to macro. We already had a major data point heading into the weekend when the latest inflation print came in below market expectations, increasing the likelihood of a Fed rate cut. This week, September CPI rose to 3% year over year, a tiny bit cooler than the 3.1% the market expected. So broadly, this was viewed as a positive. Now, of course, there's nothing positive about your savings losing 3% of value every year. 3% is still above the Fed's long term 2% target. And that 1% difference matters why? Compounding at 2% inflation, cash loses half its purchasing power in about 35 years. At 3%, the half life drops to about 23 years. Time is your scarcest asset, scarcer than Bitcoin. You trade hours for money and money stores your work like a battery. But inflation drains that battery. It steals your time. So forget cpi. We know the number is manipulated by bureaucrats to make true inflation seem lower. The the real driver of inflation is money creation, and the annual growth rate for the total money supply as measured by M2 from March 2020 when they started QE, to August 2025 is about 6.3% per Federal Reserve data. Again, that's 6.3% per year. At that pace, your cash loses half its purchasing power in about 11 years. Yet markets treat 3% CPI as a win, which gives the Fed cover to cut rates. The last time the Fed cut rates, Jerome Powell mentioned that the Fed's focus had shifted away from price stability toward prudent risk management, meaning it would prioritize adding liquidity to bolster the economy instead of worrying about bringing down inflation. Now, I've had some people ask recently what liquidity in markets means. And to put it very simply, liquidity is how much spendable cash and credit are around and how quickly they can be used. How liquid is the market? After this CPI print, the market is currently assigning a 96% chance that the Fed delivers another 25 basis point cut this week. So with another cut imminent. That's generally good for asset prices. But it's the Fed's balance sheet policy that has caught a lot of people's attention. When Fed officials meet in the coming days, they'll face the question of whether or not they should stop shrinking the central bank's balance sheet. This is known as quantitative tightening, or qt. In a speech earlier this month, Jerome Powell signaled that the Fed may be approaching the point of ending QT in the coming months, though it could happen sooner than that. QT means the Fed lets some of the bonds it owns mature or sells them so reserve levels fall. Now, while the Fed has been reducing reserves with qt, savers have also been shifting into money market funds to capture higher yields. And as a result, money market funds are at a record high of about $7.4 trillion. Now, these funds don't keep money in banks. They either buy new T bills, meaning cash goes into the Treasury's account at the Fed or Or they use the Fed's reverse repo facility, which is essentially an overnight parking spot, so to speak, that lends cash to the Fed for one night and gets it back with a bit of interest. In both cases, the cash isn't sitting in banks, so when reserves get too low, short term interest rates can jump and markets can seize up and become unstable. That's likely why the Fed is considering tapping the brakes on QT to keep the banking system stable and low. Liquid reading the same signals strategists at JP Morgan and Bank of America expect QT to end this week. Ending QT would halt the reserve drain, providing another tailwind for liquidity conditions and by extension, that's very good for asset prices. On top of it being a Fed meeting week, it's also a huge week for corporate earnings. About 20% of the S&P 500 is set to report, including tech juggernauts such as Microsoft, Google Meta, Apple and Amazon. The Cabase letter highlighted just how big of a week this is in terms of earnings, writing that $15.2 trillion in market cap worth of big tech stocks will report this week. Now I want to add strategy to the list above. Michael Saylor and his team's quarterly earnings presentations have become a must watch for the Bitcoin community. Strategy reports Thursday. So mark your calendar and with rate cuts, QT potentially ending, and major companies reporting earnings, this is one of those weeks that can determine the outlook for the market for the foreseeable future. All signs point to a potential being a positive week for asset prices, including stocks and Bitcoin but of course we'll have to wait and see. Need cash but don't want to sell your Bitcoin? Ledn is the global leader in bitcoin backed loans, issuing over $9 billion in loans since 2018 and they were the first to offer proof of reserves. With Leden, you get custody loans, no credit checks, no monthly payments and more. Visit Leden IO Natalie to learn more and get a quarter percentage point off your first loan. Another potential tailwind that could get bitcoin and stocks back on track is the report that U.S. and Chinese officials have reached a framework trade deal. If you recall, Trump's truth social post, threatening 100% tariffs on China, which was retaliation for China's rare earth export controls, helped spark the crypto deleveraging a couple weeks ago. Now it appears that fear and uncertainty may soon be behind us. Treasury Secretary Scott Bessant said the two sides have met, resolved several contentious points and agreed on a trade framework. A Chinese official echoed that, noting a preliminary consensus on export controls and shipping levies. Bessant added that these terms include the US eliminating the 100% tariff slated for November 1st while China delays and re examines its rare earth export control plans. Officials have set the stage for President Trump and President Xi Jinping to meet Thursday in South Korea to agree on the terms of the new framework. If the leaders finalize a deal, it would ease the trade tensions that have rattled global markets for the last two weeks. So it sounds like trade talks are moving in the right direction here and markets should respond accordingly this week. This is one of those win win situations for Bitcoin. If trade tensions escalate, capital gravitates toward apolitical, neutral monetary alternatives. If they de escalate, uncertainty falls, typically a tailwind for asset prices. As the saying goes, everything is good for Bitcoin. So let's see what's in store for US China relations from here. Okay, let's wrap up this news block with a couple more stories that caught my eye this week. The first President Trump has pardoned Binance majority owner and founder Changpeng Zhao, better known as CZ. CZ founded Binance in 2017 and grew it into the world's largest most liquid crypto exchange with nearly 300 million users globally. In November 2023, CZ pleaded guilty to one count under the Bank Secrecy act for failing to implement an effective anti money laundering program. He was sentenced to four months in jail and Binance agreed to a record $4.3 billion settlement with the US government. Now CZ has been pardoned and he posted on X Deeply grateful for the pardon and to President Trump for upholding America's commitment to fairness, innovation and justice. We'll do everything we can to help make America the capital of crypto and advance web3world. Some cheered the decision, arguing his punishment was too severe for a compliance failure and that he'd been made an example of by the hostile Biden administration. Others voiced concerns, speculating about backroom favors and pointing to Binance's recent initiatives around Trump aligned crypto ventures like World Liberty Token. Regardless of how you feel about it, this pardon could open the door for cz, one of the most successful entrepreneurs in this space, to return to Binance and push more aggressively into the US market, potentially shaking up the industry landscape. By the way, if you didn't see Peter Schiff has officially challenged CZ to a debate on gold versus Bitcoin, a challenge that CZ accepted. No word when this will happen or who will moderate. But of course I did throw my hat in the ring since I have experience debating Schiff on gold versus Bitcoin myself. Another major market structure announcement happened this week when JP Morgan reportedly announced plans to allow institutional clients to use their Bitcoin as collateral for loans by year end. This would mark a significant deepening of Wall Street's digital asset integration. Okay, so this is big news. Many bitcoiners end up feeling like they have to sell their bitcoin and pay capital gains tax to cover things like that down payment on the house or a big medical bill or college tuition, instead of borrowing against their bitcoin like they would with other assets. In fact, Bloomberg's Eric Balchunas reported that some OG Bitcoin whales are getting around this by effectively trading in their physical Bitcoin for shares of BlackRock's ETF iBIT, because owning the ETF has TradFi perks that Bitcoin doesn't like easily borrowing against it in the traditional financial system. BlackRock has reportedly already done $3 billion worth of these trades. Now, great firms like Leden have worked hard to create a reliable option for spot bitcoin backed loans, and if the big banks step in, competition could add liquidity and push costs down for users. And people have wondered why the big banks haven't moved sooner. After all, bitcoin is pristine collateral. It's globally liquid, fungible and verifiable. Ask yourself this if a borrower defaults on a loan, which collateral is easier for a bank to liquidate? A piece of real estate or a slice of Bitcoin on first principles alone, this always made sense. Perhaps banks just needed more regulatory clarity before launching these services. This announcement marks a stark pivot for JP Morgan, who CEO Jamie Dimon has been publicly very critical of Bitcoin over the years. And overall, this is a win for Bitcoiners. As more banks accept Bitcoin as collateral and compete to offer financing. User costs and interest rates should fall, making it easier and more affordable to tap liquidity without selling SATs. And I think everyone can agree that fewer sellers is bullish for Bitcoin. Every week, Bitcoin's market infrastructure is becoming stronger and more integrated into the traditional financial system. Everyone bends the knee to Bitcoin eventually, and that includes the US's largest banks. That's it for the News Block this week. Before I go, I want to invite everyone listening to join me on Tuesday, November 18th at 7pm for my official book launch party and signing event at PubKey in New York City. This is a free and public event at the Bitcoin Bar in nyc. I'll be there signing books and celebrating and would love to meet you. You can register for the event by clicking on the link in my show notes or heading to my substack thenewsblock.substack.com and if you can't make it, it's okay, but make sure to pre order your copy of Bitcoin is for everyone online today. Thank you so much for all your support as we continue to educate the world about Bitcoin.
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That's it for the News block, your weekly Bitcoin and economic news update. Powered exclusively by ledn. I'm Natalie Brunel. Make sure you're subscribed to Coin Story so you never miss an episode. This show is for educational purposes and should not be construed as investment advice. Until next time, keep stacking.