CRYPTO: IF YOU ONLY MAKE ONE SIMPLE MOVE, DO THIS!
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*Attencion! Nothing here is financial advice of any sort.
It is brought to you purely in the spirit of br’er Rabbit.
“Br’er Rabbit was mighty scared. He begged, “Oh, Br’er Fox, I don’t care what you do with me, so long as you just don’t throw me in that briar patch over there.” But a few minutes later, he hears somebody calling, “Oh, yoo-hoo, Br’er Fox! Over here!” and he looks – and he sees Br’er Rabbit, sitting on a rock, combing the tar out of his fur with a stick. “Didn’t you know, Br’er Fox,” called Br’er Rabbit. “I was bred and born in the briar patch! Bred and born!” And he hopped away with his bitcoin….. -ed
Readers wanted me to distill my ideas into one single action they can take Monday morning at the 9:30 market open.
Here it is:
You all have accounts where you can buy stocks and funds, right?
Go online, or call your advisor and tell them you want to
buy ticker BITW in your account.
How much? Perhaps 1-10% of your account. It’s up to you.
Why?
BITW is a fund with the following assets in each share”
60% Bitcion
30% Ethereum
10 % Solana plus other top altcoins (the “sizzle”)
HERE’S THE KEY: Each share is trading at about a 35% discount to the crypto it holds right now. This won’t last. We mentioned a similar set up with GBTC and GDLC last year, and the discount has now evaporated giving you everything that bitcoin has done PLUS around 100% MORE!! (That’s what happens when a 50% discount changes to a zero discount. It takes 100% gain to do it!)
It happened last halvening four years ago, and it could happen again! (Actually, it’s market price climbed to over 100% premium to NAV/ net asset value, LOL! I dont think this will repeat because BITW already has filed plans to conver to an ETF at (guess what!) full par value, once the SEC approves Ethereum etfs, which is widely expected to be it’s next crypto move later in 2024.
It you don’t quite get anything here, RE-READ it until you do! It’s not rocket science, but it will give you a bit of that legendary “unfair advantage” so important to investing success.
BTW, you can calculate BITW components and discount to NAV live at
BITW | Bitwise 10 Crypto Index Fund | Bitwise Investments
The “NAV” is what it's worth. The “market price” is what you can buy it for right now (when the market's open).
EACH SHARE CONTAINS (ALL at a WHOPPING DISCOUNT):
Bonus!!
Here's a new interview well worth listening to this weekend:
New! BITCOIN GOLDRUSH: JAN 2024 TO 2034.
(No, you haven't missed it!)
Essential info. Listen:
Wanna know how STEVE KIRSCH ACCUMULATES HIS BITCOIN?
HERE YOU GO
"I will be letting you in on the method I personally use to buy crypto. It’s very easy for anyone to use and will give you an edge over most of the people who trade using the standard tools.
https://kirschsubstack.com/p/how-i-buy-crypto-at-the-best-price?r=1r77zd&utm_campaign=post&utm_medium=web
Up ANOTHER 5% today, yet its STILL EARLY DAYS!!
Why not read the managers (BITW) memo from today???
"MARCH 11, 2024
Everything Season
Bitcoin gets all the press these days, but it’s not the only crypto asset that is rallying.
Ethereum, for instance, is outperforming bitcoin this year, rising 78% against bitcoin’s 69%.¹ Many small-cap coins, like RNDR (up 119%) and NEAR (up 88%), are doing even better. We’re even seeing rallies in speculative meme coins: Shiba Inu (SHIB) is up 247%.
You’d think crypto investors would be excited by this across-the-board rally, but for some there is a sense of foreboding. On X (formerly Twitter), at conferences and in news articles, people are wondering whether we are front-running the market cycle. In other words: If the meme junk is rallying, this bull market must be getting long in the tooth.
It’s not a crazy thought. Crypto bull markets have traditionally followed a predictable cycle: Bitcoin rallies first, then Ethereum, and then more speculative assets surge in a frenzied atmosphere, right before the market tops out and crashes. There’s even a term for it: “alts season.”
So, is this a classic alts season? And does that mean we are near the beginning of the end?
I don’t think so. In fact, I think this bull market cycle is just getting started. Let me explain why.
What Drives Alts Season and Why I Think This One Looks Different
The primary driver of alts season is a classic wealth effect. Crypto investors make money in bitcoin, feel rich, and then look for more speculative assets to invest in.
This happens in the traditional economy too, where people make money in large-cap stocks and then start investing in small caps, venture capital, and other investments. In traditional finance it’s called “style rotation.”
Importantly, what catalyzes alts season in crypto is absolute wealth. In other words, what matters is not the percentage return in bitcoin but the actual amount of wealth created.
For example: When bitcoin went from $1 to $2 in 2011, its price rose 100%, but its market cap rose less than $20 million. That’s hardly enough to make bitcoin holders feel wealthy. By comparison, bitcoin’s recent jump from $40,000 to $60,000 was only a 50% move, but it increased the wealth of crypto investors by approximately $400 billion. Now we’re talking!
The reason alts season has started earlier than usual in this cycle is that bitcoin is starting from a larger base than in previous cycles. As such, even relatively small percentage moves in bitcoin can create enormous wealth effects. A 10% bump in bitcoin’s price is now worth more than $100 billion!
Because many of the small-cap coins are still relatively small in size, the trickle-down effect of this wealth creation can have a huge impact.
Welcome to “Everything Season”
There is one more way that this alts season differs dramatically from prior versions, and it’s important.
Historically, alts season signaled the beginning of the end of the bitcoin bull market because marginal capital shifted out of bitcoin into the rest of the crypto economy. There just wasn’t enough new money flowing into bitcoin to sustain its momentum.
But bitcoin’s 2024 rally is being driven in large measure by a massive and ongoing influx of money from outside the crypto-native sphere into the bitcoin ecosystem via ETFs. Since launching in January 2024, more than $10 billion in net new money has flowed into ETFs, most likely from investors who did not previously have exposure to crypto. These inflows show no signs of slowing.
This suggests that the wealth effect can continue for some time, and that bitcoin can rally alongside alt coins, as non-crypto money is flowing into bitcoin faster than bitcoin money is flowing into alt coins.
I call this “Everything Season,” and I suspect it will be a defining feature of this bull market.
One last note: Be careful out there. Amid the rise of bitcoin, Ethereum, and other important crypto assets, there’s a temptation to be indiscriminate. The fact is, there are lots of terrible projects that get funded in exuberant bull markets, and many crypto assets are already trading at crazy valuations.
There are some great projects as well, of course. But not everything that's going up deserves to be. In other words, even during Everything Season, remember that not everything is created equal.
(1) As of 9am on March 11, 2024.
Risks and Important Information
No Advice on Investment; Risk of Loss: Prior to making any investment decision, each investor must undertake its own independent examination and investigation, including the merits and risks involved in an investment, and must base its investment decision—including a determination whether the investment would be a suitable investment for the investor—on such examination and investigation.
Crypto assets are digital representations of value that function as a medium of exchange, a unit of account, or a store of value, but they do not have legal tender status. Crypto assets are sometimes exchanged for U.S. dollars or other currencies around the world, but they are not currently backed nor supported by any government or central bank. Their value is completely derived by market forces of supply and demand, and they are more volatile than traditional currencies, stocks, or bonds.
Trading in crypto assets comes with significant risks, including volatile market price swings or flash crashes, market manipulation, and cybersecurity risks and risk of losing principal or all of your investment. In addition, crypto asset markets and exchanges are not regulated with the same controls or customer protections available in equity, option, futures, or foreign exchange investing.
Crypto asset trading requires knowledge of crypto asset markets. In attempting to profit through crypto asset trading, you must compete with traders worldwide. You should have appropriate knowledge and experience before engaging in substantial crypto asset trading. Crypto asset trading can lead to large and immediate financial losses. Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price.
The opinions expressed represent an assessment of the market environment at a specific time and are not intended to be a forecast of future events, or a guarantee of future results, and are subject to further discussion, completion and amendment. The information herein is not intended to provide, and should not be relied upon for, accounting, legal or tax advice, or investment recommendations. You should consult your accounting, legal, tax or other advisors about the matters discussed herein.
Author
Matt Hougan
Matt Hougan
Chief Investment Officer