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The Wolf Of All Streets
Bitcoin Up While Stocks Are Down - Are We Decoupling? | Crypto Town Hall
01:01:29
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- [00:01]
Scott
Good morning, everybody. Welcome to Crypto Town Hall, 10:15am Eastern Standard Time, every single weekday here on X. And this is a pretty unique Monday at the morning for a Monday morning because we have the rare, the rare situation where bitcoin, as it says in the title, is up while stocks are down. We've seen a lot of relatively volatile moves by bitcoin on Sundays, both to the upside and the downside. Obviously illiquid, sometimes giving us a hint of what is to come in the next day or week. But right now we have the Nasdaq tech obviously down 2.42% on the day, and Bitcoin is at 87,714. Big candle breaking out and up since the markets have opened. This is not something that we see very often during U.S. trading hours. We've been talking all the time on this show about the fact that since Liberation Day, since tariffs became the main topic of conversation, since that happened, we've largely seen bitcoin flat, which you would consider actually uncorrelated and outperforming. Well, now it's really outperforming because it's pushing towards 88,000 while we're having horrible day for the S and P and for the NASDAQ to start. Not something we would normally expect. We all know that you have to zoom out and it's hard to make judgments on these shorter time frames. But I mean, Dave, we were just talking about this on Macro Monday, obviously, but now we do have a couple weeks of data, I would say, where bitcoin is largely outperforming stocks, or at least not trading alongside them. And today, on a Monday, seeing this strength is really starting to give me a bit more confidence in this theory.
- [01:52]
Dave
Well, I mean, yeah, it is the unique weekend because typically, actually unique day, typically when it rallies into the open, it's been, you know, textbook that it drops. And in fact, there was a down candle followed immediately by it reversing and moving higher. And I'm talking about Bitcoin. And so I think a lot of people, the professional traders got stopped out on their shorts and. And so that's what's going on. As we said a few minutes ago on the Macro Monday show, it's not crazy. Pretty much the entire world is repudiating US assets, and Bitcoin is a global asset, not a US Asset. And so US Assets being repudiated and the likely response of the US to print more money and the response of pretty much everyone else to print more money should have bitcoin more correlated with gold. It's a question of did, do people on the margin need to sell it? And we've been talking about for months seemingly. Actually, yeah, it's been a couple of months now, certainly the last month that when sellers in the crypto world get exhausted and the people who are buying bitcoin as a hedge gain privacy, you're going to see some interesting market changes. And I think that that's, this is the beginnings. I don't think it's out of the woods yet. You know, look, there's economic uncertainty.
- [03:11]
Scott
I mean this is, this is a real, this is a nice candle on massively increasing volume from the weekend already. And we're at 88. I definitely can't like, like I said, can't say out of the woods. Can't make a huge judgment on this. A bitcoin pushing right into the 200 ma here. And just for people who watch charts, I can pin one later. But bear trends are considered in markets when you have a series of higher lows, excuse me, lower lows and lower highs. And that's what we've had since the all time high, 109,000. If Bitcoin breaks above 88,800, which is now a rounding error, it's only $800 away, you would have the first higher high in that series which would give at least traders much more renewed confidence that the bearish trend since the all time high is over. Go ahead, Sasha. Yeah, One thing to add is also this morning Micro strategy or strategy now filed an 8K with the SEC announcing that they bought about half a billion dollars worth of bitcoin over the past week.
- [04:17]
Joe
So that could also have contributed to.
- [04:20]
Scott
Some of the price move. I agree with that. But I think that's become so passe. Every single Sunday you get the sailor tweet, you know, saying that they're basically alluding to more buying. And then Monday you see the buy. And last week we had a huge purchase too. It was bigger, right? That last week. Yes.
- [04:41]
Douglas
Yeah.
- [04:41]
Joe
It's the second consecutive week where they.
- [04:43]
Scott
Do these, these announcements. So I don't necessarily disagree. I think, Dave, on macro Monday, you pointed out maybe the bigger announcement right now is Charles Schwab coming online and saying they're going to offer bitcoin spot trading.
- [04:55]
Dave
Yeah, I think people don't understand what that means. So let's contextualize it. They're the largest online broker. They have, they have diversified their business to being, to not just being online. They have financial consultants and offices all around the United States. And once they are able to offer crypto trading services. And you can bet that it's not going to be fartcoin. Right? You know, it's going to be bitcoin centric. Once they have that, every one of their salespeople now has a financial incentive to have people buying and selling basically and putting bitcoin into people's portfolios. And if you, Charles Schwab does it just like Robinhood is announced and just like I've said, basically almost every broker will offer it. Probably Vanguard, which is a very small brokerage by the way, big asset manager, small brokerage. Probably they won't offer it. But you can bet that this is a trend, that that is, is a very big one. And the tailwinds for this are. It's, look, it's 12 they're saying within the next 12 months and you know, who knows whether they'll get that done. But it's the kind of thing that is a massive unlock and you will see much more of this going forward.
- [06:11]
Scott
Is Schwab the one that finally tips the scales? Dave, we've obviously seen these announcements for months, if not years now as these platforms slowly come online. For example, can Charles Schwab having success here actually bring Vanguard on board or is Vanguard out forever?
- [06:29]
Dave
Who cares? Charles Schwab is an order of magnitude larger than Vanguard on the brokerage side. What it will do is, is you can bet that, you know, Morgan Stanley which is already saying E trade is going to offer it, they're probably thinking, you know, we need to be able to allow our financial advisors to do that because they have, you know, Morgan Stanley is a, is a roll up of a bunch of firms including the old Smith Barney brokers, et cetera. So look, there's. The ones that you really should be watching are what I'd call the managed money professionals. There's a lot of brokers and it's an epicenter in St. Louis. So you have Edward Jones, you have Wells Fargo Advisors, there's a whole bunch of others that are there, Stifel, Nicholas, which is. Well, they're not in St. Louis, they're down in Baltimore. You have in the Midwest you have Robert Baird, you have, you have these mid sized brokers who all have large numbers of financial advisors. Those are the ones you want to start watching. I would be stunned if every single one of those doesn't, you know, doesn't go in this direction over the next year because it frankly makes sense for them economically. I mean this is not a religious thing. In the case of Vanguard, their Management treats it almost like a religious thing, and that's fine. But Vanguard's brokerage is nothing, relatively speaking. I mean, I'm not saying they're nothing. I used to run a market maker and they were an important client, but they're much, much smaller than the aggregate of all these others. So I think Charles Schwab is a tipping point. I think they are the, the kind of, the classic, you know, major firm that's been fairly conservative, but, you know, you know, but they were the first big online broker. Never forget that. So to me, that is, it is a very big deal.
- [08:17]
Scott
And once again, if you take a look at the bitcoin chart right now, it's not only that it's up on the day, it's pushing up and is at the high of daily trading while these other assets are dropping. So Bitcoin's up about 4%, gold up about 3.25% right now. But the NASDAQ's down about 2.5% on the open. So this is really meaningful, at least in the short term. Would love the rest of the panelists opinions on that. What's happening there? Go ahead, Joe.
- [08:46]
Joe
Yeah, no, I've not seen a day like this in a long time. You know, the, the Nasdaq is meaningfully down to two and a half, almost 3% now, down almost 11% on the one month where bitcoin is now going to be pushing up 5% on the one month. And you know, inflation is actually normally a good thing for risk assets. Right. You would normally see the market moving up on that. But the difference being here is that the buying power with the tariffs is gonna, is making a meaningful impact on the earnings of stocks and companies. Right. Where that doesn't make a meaningful impact is on something like bitcoin. Right. So you have the perfect storm of all of the regulatory tailwinds that are happening, all the adoption, right. By the end of the year, you might be able to potentially hold, you know, bitcoin in, in some of your bank accounts at some of these regional banks, right? So you have this kind of complete land shift happening underneath you. And I think what people are saying is that what this is telling me is that, you know, crypto too broadly is going to be in a completely different place. You don't just have bitcoin moving up, you have other ecosystem tokens moving up quite considerably. You know, Ethereum is going to do what Ethereum is. It's kind of, it's kind of bearish right now. But you have Solana Moving up meaningfully. You know the bitco ecosystem tokens like stacks up like 13, 14%.
- [10:12]
Tomer
Right.
- [10:13]
Joe
People are seeing that the building is going to happen. It's you know, we have regulatory tailwinds. Bitcoin's moving up and normally what you see is bitcoin kind of moving up and sucking the market. And then we kind of see this rotation into alts. You're kind of seeing standout projects starting to move up. So it's a really, you know, really fun day to say that you're all in on crypto and you don't own any stock. So depending, depending on where people are at, if you've been in the ecosystem a while, it's an interesting day.
- [10:39]
Scott
I was just looking at the stacks chart and it has on Binance, so I'm looking at the stats. Major breakout on Binance, Major breakout has the highest volume. We're halfway through the day right on the 24 hour. I mean there's 10 hours left but highest volume we've had since February. And you know my indicators have a huge green arrow pointing up as a buy signal.
- [11:00]
Alex
So.
- [11:01]
Scott
And I'm seeing that on a lot of altcoins here. I, I've seen that so many times and they've been fake outs. Not looking bad for some of these as you said. Douglas, go ahead.
- [11:11]
Florian
Well, I think that bitcoin in the last couple of months has really taken the brunt of folks selling perhaps to cover margin calls on the equity side. But meantime gold has been making new highs and the dollar index has been on a one way move lower. And I think that perhaps now the selling to cover margin is over and now bitcoin needs to play catch up considerably on the dollar index drop and on gold's rally. And you know, I think we've all seen these charts, I think you know, you put these, these charts out as well of, of where M2 is going and where it's going to be versus where Bitcoin is right now. And it seems like, you know, we're at this coiled spring type level. And as you say as we break through this what 88, 488, 500 level, you know, maybe by the end of the day we're at 92,000. But I'll say that the price action today reminds me a lot of when we were hearing about the middle central banks coming in and maybe adding to their reserves. This seems to be, you know, a steady buying pressure as we're having this call which if you remember a couple of months ago we had the Same sort of thing. We're having a call. We're watching bitcoin going up a thousand dollars every 15, 20 minutes, which tells you there's a vwap going on here that that's really sort of, you know, moving this thing higher. So this looks like reserve management to me. And obviously this break around these levels that we're just getting to now could easily see us jump up another 4,000 today. I think it's all very exciting, but I think bitcoin is just really paying catch up. And maybe the tourists are now out of the. Out of their bitcoin owning. The Hodlers are now holding on. There's not a lot of sales on the top side. There's heck of a lot of shorts on the top side. And that maybe is the start of that big move we've all been waiting for.
- [12:58]
Scott
As we were talking here since the show started, I got texts from two friends on Wall street, both saying, is China buying bitcoin? These are not guys that text me very often about bitcoin. They're not particularly bitcoiners. And both of them saw this price action just on their terminal, saw gold going up, saw bitcoin going up, see the dollar crashing, right? I mean, we have the dollar at the dollar at the lowest point that it's been at in years, basically, and continuing down. And they saw that on their terminal and said, well, if gold's going up and bitcoin's going up at the same time and the dollar's crashing, doesn't that mean China's buying both those things and selling off Treasuries in the dollar? So it's hitting the mainstream. Douglas, these are not guys that would have called me on a normal day and asked why bitcoin's going up.
- [13:49]
Florian
There's also a significant rumor coming out over the weekend that Trump this afternoon is going to announce a big trade deal with J and with South Korea. And, you know, bitcoin is seen as the leader sometimes in market movements. You know, the Nvidia news could be really just Nvidia focused. But I think that, you know, if it comes out that we do have a trade deal with Japan and there's another 75 countries sitting there in the pipeline, that the tariff stuff could easily start to move away and become a sort of a US plus a coalition of the willing versus China, and if that is indeed the case, then you're going to see a huge move higher in bitcoin.
- [14:34]
Alex
I can't hear Alex.
- [14:35]
Scott
Give me a gentleman here, Alex. Because I never know.
- [14:38]
Orion
Hey, Scott.
- [14:39]
Scott
Okay, go ahead, Alex. Yep, there I hear.
- [14:41]
Orion
Yeah. So I, sorry, I think you're cutting out. But yeah, I just wanted to back up what you're saying about China buying bitcoin because that was actually Arthur Hayes hypothesis. If you're following his account, he essentially said that the trade war would lead to not just China buying up gold, but also buying up bitcoin. But I think what's really interesting, Scott here is when we look at bitcoin dominance relative to altcoins, it's also getting close to an all time high since 2021. So 64%. And if it actually goes above 70%, that's an all time high since we're talking about 2016, 17 days. So is bitcoin decoupling from not just crypto? I think bitcoin is decoupling from risky assets in general. So this is really where bitcoin was supposed to be supposed to be a hedge against inflation, was supposed to be also a safe haven. And it's really gaining this definition that it has. And I think that's. There's one thing that is pretty cool too, Scott, is are the other altcoins pumping because there is positive sentiment to risky assets? Absolutely not. Right. Like we can see how the stock markets are reacting. So what is really interesting for me, Scott, and why we should all be thankful about other coins like Solana, Ethereum that are also going up in tandem with bitcoin is because in crypto specifically the trading markets between 60 to 85% of all trading volume is algorithmically made. So when bitcoin goes up, you know, those, the people have different strategies. It actually takes profits and reallocates into other assets. So the big question here is despite the fact that crypto is the riskiest of all markets, should all the altcoins and projects be grateful for Bitcoin and its rally to support price action? And I think that's a good question to figure out.
- [16:33]
Scott
Yeah, Tomer, go ahead and then I'll make my point.
- [16:37]
Tomer
I'll be super quick. We are now a year and a couple of days past the having and there's a lot of people who point out that that's really how long it takes for bitcoin to start finding its, its feet. I don't know if there's any logic to that or any reason to that, but we're kind of in that, you know, now we're a quarter of the way through the most recent cycle and things happen. And for me it's still, it's hard to understand how bitcoin didn't keep up with gold or you know, went down 16% while gold went up 25% on the year to date basis. And so I think that there's been some selling pressure that we're not really clear who the seller was and sooner or later they're going to change their mind or they're going to run out of miners.
- [17:22]
Scott
Yeah, miners. Tomer. I think because, because so exceptionally high that mining bitcoin has not been particularly profitable even for the biggest entities. And March was the largest minor sell off that we've seen in a very, very long time. That's just one.
- [17:35]
Tomer
Yeah, that's like one sailor alone has been buying four times what the miners have been manufacturing. So there's, there's been a, a greater intensity of selling pressure off, you know and, and sell and sailors buying at whatever price is, is the market price. He doesn't have like I'm not going to pay a dollar over $80,000. So he was buying at 109,000 when it, when it topped off. And there's, and there's other big buyers too. So I remain, you know, I, to me the down downward pressure is kind of like a mystery that we may never know the full answer to. But who cares if it's going up? I guess.
- [18:12]
Scott
You know Tomer I think we're always surprised especially in bear markets at how much bitcoin is out there that people are willing to sell. We always have the like who the hell is selling this much narrative. We never really know.
- [18:25]
Tomer
For people who follow wicked smart, the guy who's an Apple, he does these amazing time lapse charts and he released one this weekend that showed how much on chain bitcoin moved during different price ranges throughout the entire history of bitcoin. And the thing that had my jaw dropping, which is which supports your point that you just made is like at every new price tier, especially these most recent price tiers, like when we hit 80,000 and above, millions of bitcoin move are moving on chain. Like not, not just you know, a million but like pretty much the entire, like not the entire circulating supply but a very large portion of the circulating supply. Like 8 to 10 million of the coins are moving within these short periods of time. And that's on chain. That's not just with within exchanges of people who have them there. That's like people who took self custody or exchanges that had it in their custody and had to move it. So it may get exaggerated to some degree but it's still a very large amount of coin that moves. So you're right about that, Alex and Dave.
- [19:32]
Alex
Yeah, I think the going back to the idea of the trade deal and what's that's doing in the markets right now. I think if you look at the only people who are saying a deal with Japan is anywhere near imminent are super Trump aligned media sources quoting unnamed anonymous rumors out of the White House. Japanese media is very much making it saying like there's no chance of it, no one else is. And I think if you look at the markets, the market's clearly going to like markets don't think it's going to happen. And I think that's true both on the traditional stock markets which are way down and on the crypto markets which are doing well, I think as the hedge against it. So I'm definitely really starting to feel the vibe of like the final actual decoupling here and maybe it does start to finally look like the, you know, inflation hedge or even more just like the new, the alternative reserve. I'm not going to say the new reserves, I don't think the dollar is going anywhere as a reserve for a very, very long time, but I think as an alternative reserve it is. But yeah, I think that markets and businesses are extremely, extremely skeptical that not only frankly that a trade deal is limited with anyone, but that the Trump team doesn't even seem to know what they want out of a trade deal at this point. They're trying to satisfy too many different constituencies and too many different supposed priorities that they have. And I think the market's just sort of starting to expect that's not going to happen.
- [20:55]
Dave
Yeah, two things. First, I think that I always hate to decoupling is a process, just like bottoming is a process. And the last three or four weeks has been, you know, you've seen today's the first day actually that you haven't seen the intraday decoupling. I mean typically bitcoin has outperformed. We know that we've, we've watched it. It bottomed about $10,000 ago from where we are now. And you know, it was a triple bottom which a lot of technicians used to care about. Although most technicians that I know claim that the area where bitcoin is trading right now, 88,000 is where they would establish shorts. So if it can hang in around these levels for any length of time and get a little impulse up, you'll see another major short covering and you could get a very substantive candle because I would bet that most of the selling right now are technical traders, assuming this is the top of the range and historically they've been right. And probably, I'd say probabilistically they're most likely to be right. But just be aware that you could see it wouldn't remotely surprise me if it could hang out around the 88,000 level for a few hours and then we get some news this afternoon that moves markets higher. You could see a wave of short covering and impulse that, you know, another $2,000, you know, big up move. But, you know, that's just from a trading point of view. And I think that you need to be very careful around these levels because we're at a very technically important level. You said it yourself, Scott, 88,000 is kind of very important. But I think that it is really also important to understand that, yeah, China might very well be, but it could be a lot of different things. And I don't want to be. I don't want to put on a tinfoil hat. I will just say that if you're a large accumulator of bitcoin and you've been accumulating, decrease in the number of crypto people selling it would be enough for this sort of action. And frankly, any smart accumulator of bitcoin isn't publicizing it until after their position is already established. And I'm not saying this isn't a dig on microstrategy. They have their public process. I'm talking about if you're a new sovereign or a new large accumulator of Bitcoin, you're not telling people that you're doing it because if you did, it would just gap up and you would buy much less. And we may never know who, you know, who is, you know, what's been going on over this weekend, what's been going on. But I think the Occam's Razor says it's simply people in the crypto sphere who did have to sell it to pay their taxes stopped. And people in the crypto sphere saying, well, wait a minute, you know, there's going to be a huge flood of monetary of money coming in. Maybe we shouldn't sell anymore. And if we don't have to sell, we won't. And I think that's what you're seeing.
- [23:38]
Scott
I want to circle back to the point that Alex made about bitcoin dominance because I know a lot of people here are holding altcoins, curious where they might be going, wondering what's going on with that market. Dave, we discussed this on Macro Monday Once again this morning. But it was a point that I made to Mike McGlone who consistently makes the point point that there's too much froth in the crypto market. I think we agree with that. He thinks that all the memes need to go to zero before bitcoin can bottom, et cetera. We obviously disagree with that. But the point that I made to him when looking at the bitcoin dominance chart is that cyclically, I think it's a bit different this time. And I hear this all the time from people I know in the market. In the past, bitcoin dominance would go up and down based on people's risk appetite in the crypto bubble for alts versus bitcoin. So bitcoin would get boring. They'd go to alts to try to make more money, try to time the move back to bitcoin, try to accumulate more bitcoin and do it that way. My feeling, and from what I'm hearing from most people, is that people are not selling altcoins to get into bitcoin this time. I think we have new entrants into bitcoin, whether it be governments, institutions, sovereigns, whatever it is. And I think that the people who have been in altcoins are capitulating to pay their bills. I don't think people who are selling their altcoin long term altcoin positions at this prices are doing it to get into bitcoin, which is why you would usually see dominance behave the way it is. I think they're literally capitulating and have been for a very long time. So I think that bitcoin dominance is moving. It's an important metric. But I think it's moving for a very different reason this time because I don't think that bitcoin dominance goes down at this point because people sell bitcoin to buy altcoins. I just don't think that's what's going to happen. Go ahead, Alex. And then Tomer.
- [25:27]
Alex
Yeah, I would say I think the biggest thing about this bitcoin dominance number now is I don't think it changes after this. Right. I'm not saying that like this is always exactly what the market's going to look like, but I think less about the moves in the crypto market specifically, but more about the Belgium natural moves. This is very likely the lock in the legitimate community for it and it's going to stay, I think. Yeah. Obviously the idea that eth ever and flips is gone. I think the idea that really any of the tackle like bitcoin has locked its position. It's never going to not be the number one thing and I think it's never going to not now be a credible alternative asset in the larger market. Which leaves it, you know.
- [26:09]
Scott
Yeah, I've always said that, but yeah.
- [26:13]
Tomer
Yeah, it's definitely separating out. CoinMarketCap has this new, reasonably new metric called altcoin season that they've put up which is which of the top 100 coins or how many of the top 100 coins have a better 90 day return than Bitcoin. And that number is solidly in what they call bitcoin season. It's been between 13 and 17 or 8, maybe as low as 18. And two of the coins that compete that are in that 16 that have beaten Bitcoin over the last 90 days are simply gold stable coins. They were supposed to take stable coins out of it, but I guess they view dollar stablecoins as stablecoins but not gold backed stablecoins. So what you're really just seeing is that even during bitcoin's decline here, the altcoin markets move down a lot more. And the other thing that you're not seeing is strong narratives supporting altcoins. Right? Like other than the narrative that when bitcoin starts to move up, altcoins may move up more, that they have high beta. The fact that there's 20 million of them and so many of them are, have been rug pulls and, and so many of them have had their day in the sun already I think just makes it really hard for anyone who's trying to figure out which altcoin to invest in or which small, reasonably sized portfolio of altcoins to invest in is just too hard to do. And, and again, the leaders on this altcoin season index are coins. I can honestly say I've never heard of the top three, the top four and then, and then you've got the two that are gold. So it's, it's a little crazy. And, and I think, I think it's just, it's saying bitcoin's different from crypto. Crypto has an unlimited supply of coins and choices and narratives and all this other stuff, but it's not clear who's what the long term story for any of them are or the short term right now, frankly.
- [28:00]
Scott
Well, but I will say that Joe, you pointed out and now you're going to jump in, but like something like stacks moving or sui moving or whichever ones are outperforming, we are seeing that it's the stronger ones with actual narratives that go up and the others stay flat. Yeah.
- [28:15]
Joe
And I think there's been some outperformers. You know, I think there, you know, something that did kind of fly under the radar a little bit. You know, you mentioned a couple of coins outperforming. Bitcoin, like mantra was one of those that just, you know, basically, you know, had a, almost a Terra Luna moment or got rugged. And so a lot of people are probably that are in the space are just kind of like a little sh. Like shocked and a little scared. Like, holy. Like even that thing that you have, you know, that went down 90. I'm not saying anything about what happened in that situation. I don't know the whole thing. So what, what matters though is that it's at 55 cents and was at $6. Right. And then the other thing that I've, I've kind of really been thinking about and when thinking about actually valuing some of these protocols, right, like you mentioned stacks, right. You know, sitting probably around today, not looking at it, but I would say like a billion dollar, like, you know, valuation. And then people say, oh, that, that might be, you know, like, where's the profits? What's happening? And people talking about Ethereum too, like, oh, it only makes like, you know, $60 million a month, but it's worth $200 billion. The way, the way I would think about that, you know, is, you know, if you had, if you had 400, like crack developers building in a building on the same type of problem, all working on different startups, look at what some of these AI startups are valued at today without revenues. Some of these valuations actually start to feel a little low knowing the actual brain power and innovation that's going into some of these things. And they do have sustainability and profit, they have longevity, right? And then I'm not even going to go down the rabbit hole of, you know, how do we value dogecoin, right? It's just a meme, right? And so when you add all of those things together, they're actually, I think a lot of these things are extremely undervalued when you can look at them from a. I would say a more venture technical analysis way. Right? So I do think some of these things are way undervalued and I think people are seeing that. And I think things that are aligning themselves with Bitcoin are going to do really well, especially with Ethereum is without a rudder completely right now and no one knows what the narrative there is. And so all these other L1s are going to keep sucking the value from an ERC20 perspective out of Ethereum. Look at base. Pick your next favorite solidity chain. So I think there's really two stories there. And then you mentioned, someone mentioned tax harvesting. It's like I'm not, you know, I'm not selling my Ethereum at 1600 and taking my profits and putting into bitcoin. Right. Like these people are taking major losses that had to sell for. For some tax harvesting and, and maybe they're writing some stuff off and I think we're, we're probably done with that. But you know, I, I don't see the narrative and crypto is narrative driven now. And so I, I have a. ETH is going to have a pretty serious problem unless they turn something around.
- [31:05]
Alex
Yeah, I think Joe's exactly right on the narrative thing. Obviously I spent a lot of time in the stacks and bitcoin ecosystems and I think if you look at like especially the last 24 hours, the only, the only altitude are really moving in a similar pattern to big. Basically the ones with a really strong bitcoin story like stacks and for. And then the AI focused ones that are up there. So I think it's. Yeah, you've got to be on the narrative thing and I think that the bitcoin connection is going to continue to be one of the strongest out there for anyone who's trying to handle going.
- [31:40]
Scott
And Alex, we've seen the first iterations of that, right. We had you always in crypto get like a first pump and then retrace another pump but then kind of retrace and then you see the real sort of adoption of whatever that narrative is. We've seen it with AI We've seen it countless times. AI all of these things. But we did for many months there have all of these building on bitcoin things catching a bid and now I think we'll see the quality ones, you know, get the attention moving forward. I agree with you. Other Alex or go ahead Alex.
- [32:12]
Orion
Hey, Scott. So.
- [32:13]
Alex
Oh yeah, no, I was just going to say that I. Sorry, real quick, Alex. I think you're exactly right on it. Which is. It's the, it's the flight to quality across the board thing. Right. People I think are moving away from be more random and I guess it's an important clarification when you're talking about narrative. Just sticking the narrative on it doesn't do it. You have to actually be able to put the narrative on it credibly. And I think that is exactly the big difference we're seeing right now.
- [32:39]
Douglas
Alex.
- [32:39]
Scott
Alex 1.2, 2.0, 2.1.
- [32:43]
Orion
So, Scott, I'd love to hear. And Scott, you, on your last podcast that you actually shared on Crypto Town hall, you talked about people going to restaurants and actual qualitative data of what you were seeing based on consumer spending. But I would love to ask everyone out here this cycle and when we talk about mass adoption, I'm pretty sure that most of you guys out here remember that in 2020 we had this comparative with Bitcoin versus Internet adoption. And I don't know if you guys remember that chart. It was widely spread across CT, but essentially it was saying that Bitcoin in 2020 was roughly where the Internet was in 1996. If you compare Bitcoin unique wallet addresses versus the number of Internet users. But Scott, one metric that is really sexy is since then. Now if we look at 2025, we're roughly where the Internet was in 2001, maybe even 2002, because the Bitcoin adoption pace has been surpassing the Internet adoption pace. So there's definitely more and more usage in terms of Internet and the brand itself. When I think about a qualitative basis side and going back to my question for you all, like nowadays, rather than having family members or friends calling me up, oh, should I buy bitcoin when literally bitcoin is either topped at $20,000 or $64,000 regardless of the cycle, where it's always at the end of the cycle, where they reach out to me. I have lots of people, including like an aunt of mine who is nearly 70 years young, and she's asking me, should I buy bitcoin now? Like literally when we, when we dumped at 74, 75k levels USD, of course. So I'm just wondering, is this an adoption thing as well, where not just, you know, obviously Wall street institutions are buying, Michael Saylor is buying, Abu Dhabi is buying, and sovereign wealth funds are buying. But could this be where the average Joe, who is like some people call Normie, even though I don't like that term, are just starting to mature and really realize that bitcoin, the brand has convinced them over all these years?
- [34:58]
Scott
Orion.
- [35:02]
Douglas
Well, I mean, I think there is certainly an argument to make that adoption continues worldwide. At the same time, I think the most important takeaway so far is that bitcoin is still very much correlated with the tech sector, with The S&P 500 and the NASDAQ, and that's probably where the decision is going to be made whether the cycle has topped or whether the cycle is still coming and will bring new all time highs towards the end of the year. In the beginning of the year I said in a piece that I wrote that I expect bitcoin to trade between 70k and 150k during the course of this year and that I expect a lot of volatility. And so far that's exactly what we're getting. Bitcoin has closed. The bitcoin future has closed its open gap. We had a massive pullback, as someone already said, fear and greed index, massive panic. So basically most of the parts of the puzzle are in place for a nice recovery. We have a very strong seasonality right in front of us into I think mid of June, probably mid of April until mid of June. Bitcoin usually is very strong. And it seems the stock market also has bottomed out. So yeah, it looks pretty positive over the next few weeks and months. And I think coming back, because I listened also to your show before, I think people really need to understand that it's not either or gold or bitcoin, it's really both. And they can coexist and it's not who's the best asset. You can have more than one women in the market, so to speak. Gold is on a track on its own here. Bitcoin looks good. I think this recovery can go further ahead. But we have already reached a 200 day moving average today. It's a little bit overbought in the short term. Altcoins have been very much disappointing, especially Ethereum. That's certainly a reason to doubt the whole theory that the cycle has not topped and that the best is yet to come. But overall I'm pretty optimistic that the adoption will continue. And there's no doubt about that in the case of more money printing, Bitcoin is the fastest horse.
- [37:10]
Alex
Dave?
- [37:12]
Dave
Yeah, I must confess that I think the entire notion of the four year cycle from a price point of view is gone. And I'm tired of it. And I'm tired of it for a bunch of reasons. But the most obvious is that the impact that the amount of bitcoin mined is now already relatively insignificant in the supply demand calculation relative to what's happening. And obviously in the beginning, three quote cycles ago it was massively important to the supply demand calculation every having now it gets less and less important. So it's of course going to be less and less cyclical. The presidential cycle is very, very relevant, there's no doubt about that. And so that four year cycle exists to the Extent that we have a uni party or had a uni party up until now, that didn't seem to have a lot of meaning. But if we start getting cycling between populism and ultra, you know, government control, I think, you know, that's a different story. But what really, really matters here when you look at bitcoin and gold is gold is, is effectively I like looking at like the gold silver ratio and the gold platinum ratio, and that is very telling. As to the dominance of the monetary value of gold as opposed to its jewelry value, we're already at the point where you're starting to see, walk past if you could find a jewelry store that doesn't say we buy gold in the window. And that's been there for a large part of this rally, that would be the only one I've ever seen because they're all looking for it. Because it's not about jewelry. Jewelry prices are obviously up because of it. But you're seeing more substitution into platinum instead of white gold, for example. Platinum used to be, you know, more expensive. That monetary component of gold is what bitcoin will ultimately eat into, but is not going to replace for a very long time. You don't even talk about bitcoin replacing that until Bitcoin is 10x this level. With gold at this price, it's probably closer to 12x. So it really is a question of whether or not bitcoin and gold will start moving together, but the magnitude of bitcoin move at some point will eclipse it. It's really a question of will that happen. And I don't want to say this cycle. I want to say in the next, you know, whatever in this presidential cycle will in fact bitcoin get there. And I believe the answer to that is highly likely to be yes. But it really depends upon the amount of money that's being attracted because more money brings everything up. And bitcoin will get a dis. A more and more disproportionate piece of that relative to everything else. Gold, on the other hand, is getting much more of it, but it would take much less of that percentage wise for bitcoin to go crazy. Because it just isn't the supply, it's the inelasticity of supply of bitcoin is what matters. And you can kind of see it playing out today, you know, in the market. It's a, it's a very, this is a very interesting day for that reason. You know, we just sell below 88. We're now back above it. I think this this level matters a lot.
- [40:17]
Scott
Yeah, it's the most meaningful level on the chart in my mind. If you're watching that, go ahead.
- [40:23]
Douglas
Yeah, I mean, look, regarding gold, I think there is two very important points that you need to understand. First of all, gold has been a highly manipulated market for the last five decades. So they introduced the futures trading in 1980, right at the top of that cycle back then. And since then, most of the time there has been basically 200 paper ounces of gold being traded for one real physical ounce of gold. And that's how they basically created the price finding. And this is now being rolled back because China has started the Shanghai Gold Exchange a few years ago and all the, the contracts there are fully backed by physical gold. And slowly but surely that physical demand has changed the way the shenanigans at the comics were able to basically sort suppress the price. And now we've seen since a few months that the LBMA in London, which is the other important gold trading place in the Western world, has problems to come up with unallocated gold positions, meaning they have sold for years and decades more gold than they actually had in their vaults. And that's something that is driving the price higher. Because if you're an institutional investor or if you're a family office or a rich individual investor and you have unallocated gold positions with the LBMA in London, you ask yourself, is the gold really there? And the LBMA in London is telling you, oh, well, it takes eight, nine weeks until we can ship, ship the gold to you. Imagine if this is something a crypto exchange would tell you about your bitcoins. So that's what's going on in the gold market. You have China buying physically like crazy for years. They're trying to move away from the dollar. And now you have basically a technical default in the LBMA in London, even though it's not an official default. And that's driving the price. And now we also have a buying frenzy by the Chinese people because they have been disappointed for years with their crash in the real estate market, also with the stock market, the Chinese stock markets in 2008-2015. Terrible investment for many. And there is no rush like a gold rush. I mean, that's what it is. And I think gold is on its own track right now. It's not very much correlated with bitcoin. And if you ask me, I think we're seeing something similar. Like in the late 70s, gold can still run to 5 and 8, maybe even $10,000 from here. And yeah, Crazy volatility. You might get a 400, $500 pullback at some point very soon maybe, but silver hasn't even shown up. So I don't think that even though it looks pretty, pretty vertical, pretty steep rise here, I think this rally has much more legs.
- [43:08]
Scott
Silver not showing up, isn't that kind of, I hate to make the obvious comparison, but isn't that sort of like what we were talking about with alt season and Ethereum not showing up while bitcoin's going up because central banks aren't going to add silver.
- [43:22]
Douglas
Yeah, it's true. But look, I mean I'm in the gold market now for 25 years. Any and every rally in gold, whether it's a few days, a few weeks, a few months or even a few years at the end, silver showed up. So it will happen, it's just a question of time. And we know the same, it's always.
- [43:39]
Scott
Happened for bitcoin and altcoins too though. That's my question. Right, exactly. I don't want to say this time is different. I think you're right. But I mean we've always seen that four year cycle we were talking about that altcoins go mad. Altcoin should have been going crazy for the last three months, Bitcoin tops. You know, there's all this new liquidity, but the fact is the bitcoin buyer is not the crypto native anymore. And I'm wondering if the gold buyer is not the silver you know, buy.
- [44:06]
Douglas
I mean there you can make that comparison. But then again it's a little bit more tricky I think because really the digital asset space is something totally different than the physical gold and silver market, I believe. I think silver will come at some point. It's probably the most undervalued of the precious metals similar to platinum. And as Dave already mentioned, I mean of course if you look at these ratios you could also make the argument that gold is crazy overvalued here. But there is a reason for it obviously and the main reason is that the Chinese trying to move away from this whole dollar based system and that basically started in 2013 with Xi Jinping slowly but surely getting rid of this symbiotic kind of trade relation where the Americans basically bought all these cheap products from China and China then used the US dollar to buy back US treasuries. So that's actually obviously not happening anymore. Like it used to be the Americans understood this as an attack on the dollar and the dollar system. And here we are. And I mean, I think Trump tries to turn things around. It's pretty obvious that if America continues the way it did the last five decades, it will have have no chance against China in the mid to longer run. So he's trying to turn around things. Will it work out? I don't know. But I think it at least makes sense to try something new because what, what America did the last five decades has only created wars everywhere has basically exported its not cheap fiat money which is backed by nothing, enslaved the world and created hundreds of thousands of homeless in America. And the purchasing power of the dollar has been diminishing. So there is a reason why they trying to so brutally shift things 180 degree from what we have seen over the last five decades. Will it work out? I don't know. I think they're trying to corner China similar to what they were able to do with Japan in the, in the late 80s early 90s. Again I have no clue whether it works out. The truth is there is a gold rush right now and most likely yeah, bitcoin can catch up. But also bitcoin will have to prove that it's, it is an asset that is also attracting enough buying during challenging economic times and that's still something that is out there that bitcoin still has to prove.
- [46:43]
Scott
And speaking of Trump, he just called pal a quote unquote major loser for Trump. How Trump is trying to influence policy. I've gaurav. Yeah Johan.
- [46:58]
Gaurav
Yeah, I mean the conversation went a little heavy for a lot of crypto audience. So one, this is my attempt to bring it back to crypto and a little bit of, let's say lighter note 2, nobody will mention memes as a reply in response to what I'm about to say.
- [47:16]
Scott
Right.
- [47:16]
Gaurav
That's a, that's a precondition. So the theory is here and I'm continuing somewhere to where you know, Florian was talking about purchase patterns and where you said, you know, it's not different this time. The only, the only effective parameter I would say in the state of market and the reason we're only looking at top caps of the commodity and asset markets like gold and bitcoins having a rush because largely we amidst these war of the worlds, not just military and weapon war but also the financial war, the world is focusing on capital preservation and we are looking at the theories like changing world order. So nobody knows if dollar is going to be the winner or whatever. So people bet for gold and betting on bitcoin and whatnot. So let's not forget the fact these are not Investment clients. These are not investment and return driven decisions. These are capital preservation driven decisions and these are macro theories. So probably getting too deep into if silver would follow or if alts would follow. We are sort of missing the biggest psychological focal point of the reason the markets are behaving. They are. Now when does alts and when do silver and when do you know, the rest of the stock markets catch up with the leading top cap? That's when the market share from the capital preservation. Yeah, yeah.
- [48:54]
Scott
I want to ask you because this is, you see, I mean I don't know how many hundreds of companies you've invested in Crypto, interesting pivot here because you have the perspective, but obviously there's still deal flow. There's a lot of things happening. But how has this mean like this new kind of structural difference in the four year cycle or alt seasons, Bitcoin dominance conversation, how is that or has it fundamentally yet affected the way that you deploy capital now? Like are you rejecting 90% of things? Are you outright not investing? What are you doing?
- [49:29]
Gaurav
I'm no different from the macroeconomic conditions and the micro psychology that I just mentioned. I'm also in capital preservation mode. So I'm definitely not deploying on things that might look like high risk and returns, which is by the way, for the audience who wouldn't know, know me is my strategy.
- [49:48]
Scott
That's how you've made money forever.
- [49:49]
Gaurav
A high return investor. Exactly. Yeah. And also lost money forever, by the way. But let's not get there. Let's keep the highest spirit on. But the point is. Yes, and being a high risk investor, even I know that this is a time of capital preservation. Does that mean I'm not deploying? No, I'm actually deploying on the basics. I'm just not going for high risk investments. Even in venture, I'm going for, for real value. So. So basically we can't, we can't ignore the fact that there were many, many startups that became multibillion dollar companies just because Covid was an incredibly unique phenomena that fit with them and with the kind of purposes they were solving. So. So we're looking at solutions that are particular to finance, that are particular to, to medicine, that are particular to tourism stuff and also particular to gold. You know, at this point, not that I want to give another long talk about how great gold is, I'm just saying bitcoin also. So we are, we are investing in things that are, that have better adoption, better revenue. Probably we would get 10 times more valuation of the same company in the same state if the markets were incredible and the all season was high or let's say even up high is wrong to even quote. I think. Yeah, that's the point. And this is a well rehearsed question and answer by the way Scott, because about two hours ago I was on a space with Gate IO and we had the same questions and we had a bunch of VCs and a whole bunch of people on the other line and. Exactly everybody said that they were either people who would say oh we are not deploying in anything and there were others who would say they were deploying in, in very stable and, and startups with the right metrics, with sustainable metrics. By the way, an important point that featured as an outcome of that space, which I would agree and you know we discussed that a lot. A whole lot of investors, VCs, crypto VCs especially have turned into, have turned their face towards liquid strategies. So in the past four years we have seen a lot of older crypto people, you know, older, not age wise but senior crypto people who are in their fifth and sixth year. They've all either launched new funds or have you know, got Approved from their VCs, their LPs. Sorry to initiate the LP side, the liquid side, because I think this is an incredible time to invest in alts for those who are looking at a, you know, at flipping the value they would make through investing in Bitcoin. Does that answer the question somewhere?
- [52:40]
Scott
Yeah, it does. I mean it just doesn't seem like the odds of something performing massively well on launch are high versus previous cycles. And gorb, I can just tell you even anecdotally like anyone who was here in previous cycles and did any sort of like VC or angel or early investing people would fight tooth and nail to be allowed to invest in something and then they would fight for whether they could invest five or six thousand dollars into it. Right, that I want that one more thousand. It could be a hundred X. Now I can just. Yeah, from what I'm hearing these projects come and they're like, you're like okay, well how big is the allocation? You're like ah, we can give you up to 250 grand. How big is around 500?
- [53:26]
Gaurav
250 they give you, they can give you the entire round. They don't have any.
- [53:29]
Scott
Exactly, exactly. Nobody. Yeah, they can't find the money.
- [53:34]
Gaurav
Yeah, the whole bunch of calls we are getting into these days, they would, they would rather say oh yeah, I mean you can take a 50% discount if you decide to lead and I'm like, am I so bad? Am I the only one taking calls? And you know, we have to take a few calls for you also, Scott, sometimes. And when we would go on these calls in the past, it would be like, oh, we have already raised three rounds and now we are looking to onboard KOLs on special terms or marketing terms. But these days they're like, yeah, I mean we haven't raised money. We are thinking if we can hit the ground straight off through marketing. Right. So yeah, the entire landscape has changed. These are troubled times, let's put it that way, for startups and these are incredible times for sophisticated investors who have been sitting on the dry powder waiting for times like these to deploy. But at the same time I think we are looking at a two month greenish season. So if there's a token that's launching tomorrow and giving you 20% liquid tokens, please don't quote me on this. This is not me saying it, but definitely you might want to invest in it. I don't know. With Florian setting up grounds after every two statement he said, I don't know what will happen. So I'm simply following his pitch and saying, I don't know, take 20% project launching in one month. You might just make 3x if nothing. So that's the state.
- [55:05]
Scott
Yeah. Alex and Florian, then we're going to move towards wrapping.
- [55:11]
Alex
Yeah. I think there's two interesting things I'm thinking about. One is when it comes to the VC vs Liquid side too, you also got to remember that the VC raising market for funds is literally as bad as it's ever been in years. Right. The last quarter was the worst in. It just keeps going down. There's no liquidity for funds and so their LPs have nothing to put back into new ones. And so that's going to continue to make the VC side of the market harder and less attractive for people. But on the more general point, when we're just talking about the back and forth between alts versus Bitcoin and things, the thing that I just keep coming back to is that for those of us who are here because they want the alternative financial system, because they want a counterbalance to government run fiat system and things like there's never been a better time like watching what is happening, watching it actually act and work like a viable alternative and to be a balance here, I kind of couldn't be happier with where things are sitting right now.
- [56:11]
Scott
Bitcoin maximalist, I mean, exactly right now.
- [56:16]
Gaurav
And also, I mean by the way you're talking about US ecosystem, where of course I'm talking about successful projects, let's say Solana, ton, whatever, right? You're talking about a product category that caters to the entire planet in a single, you know, unanimously. So what better sector would you have? It is finance, it is technology, it is embedded. It's a part of an embedded stack, Technology stack. So probably every single technology in the world has a probability to use it. You know, what can be better as an investment? So I definitely resonate to what Alex just said and it's an incredible point for any investor, alternative asset investor, to look at and consider before making an investment decision into stocks or maybe even gold.
- [57:06]
Douglas
Yeah, I would agree. I think that, I mean, these are very opportune times as well. I mean, not only that, the seasonality for bitcoin and hence the whole crypto sector is turning quite green over the next two, three months. I mean, there is so many opportunities now due to this big disruption. I had a lengthy discussion yesterday with one of my clients. He's a big guy in the customization industry and he has two factories in America and he's considering that he can take over a vast amount of all these Chinese businesses because Walmart needs the products and the Chinese cannot ship them to America anymore. And we've been only discussing about opportunities. So I think you just have to understand the world has changed and you always have to adapt and you always have to think outside the box. And I wouldn't dare to go all in right now on highly speculative altcoins and meme coins and all these kind of things, but bitcoin recovering towards 90 and 100k. Yes, very likely, I guess. And Solana should also do really well.
- [58:12]
Gaurav
Before they go on a wrap. And given your background and the long talk on gold, I have a small question. Maybe did you follow the news from Trump's office about selling a bit of gold reserves to buy Bitcoin? What do you think about that? Do you think there's a broader future to that? The way Russia's made moves and China's made moves around bringing the global financial system back to the pegging of gold or whatever they want to do, and then eventually us finding themselves at a place where they are not probably the biggest treasurer of gold? I mean they are, but they trying to reestablish the base value instead of gold to this new value, which is bitcoin, and also largely held by US entities like MicroStrategy. I mean, now strategy and so on. What do you think about this theory. This can be absolutely flimsy and you can throw it in the dustbin, but give it a shot, maybe.
- [59:06]
Douglas
Well, I always thought that this came out of the crypto kind of lunatic corner, that they would assume that somebody would sell. I mean, the state would sell their gold to buy bitcoin. I think it's totally absurd. I mean, they would rather just add bitcoin. In that geopolitical competition where we are right now, it doesn't make sense at all to sell your gold while Russia and China are stacking gold like crazy. So I don't think it's happening. What we have seen is that.
- [59:36]
Gaurav
You mean the news is not real.
- [59:38]
Douglas
I don't think that even if Trump would think that. I mean, today he. He posted that who has the gold makes the rules. I mean, you know how erratic he is.
- [59:48]
Gaurav
So that was. That was a post made not by Trump's handle. It was made a post. It was a parody account.
- [59:59]
Scott
In an interview with Pomp and said it repeatedly works under David Sachs. But they would entertain that.
- [60:06]
Gaurav
Yeah, I mean, but it's an old statement, right? Exactly. Yeah, yeah, yeah, yeah.
- [60:09]
Scott
No, but I don't think they.
- [60:10]
Gaurav
I think there was a date written.
- [60:13]
Douglas
Well, I don't think it's happening to sell gold for bitcoin. I mean, I wouldn't advise it. I mean, of course, if you have a bitcoin to gold ratio at extreme, extreme levels, and gold would trade at 10,000. And Bitcoin still sits where it is right now. Probably, yes. But I don't think this is happening. I think you can shoot as a state, hold and own both, and basically extend the position. Right now, the main geopolitical money asset is gold. Can it become bitcoin down the road? Yes, probably, but I think this will take years.
- [60:56]
Scott
Agreed.
- [60:57]
Gaurav
Yeah, years for sure. Nothing's happening tomorrow.
- [60:59]
Scott
Yeah. All right, everyone, while we've reached the end, that was a great conversation. Interesting to see this outperformance continuing. Guess we'll see where we land tomorrow. Everyone in the audience, please give everybody on stage a follow. They're amazing. And thank you to all of them for participating, giving freely of their time to share their perspectives and opinions and insight with all of us. And thank you to all of you for listening. We'll of course, be back tomorrow, 10:15am Eastern Standard Time. Have a good one, everybody.