Best of Crypto

This strategy invests into crypto assets that potentially outperform Bitcoin. The strategy will stay diversified and won't invest more than 15% into one single asset except for Bitcoin, cash-like Tether, USDC or Pax Gold. Usually it's even more diversified. The strategy moves to cash-like coins after strong market runs or if indicators point to more difficult times. Thus drawdowns should be reduced.

Quite frustrating past few days. Bitcoin and almost only Bitcoin was going up, everything else stagnated or was going down. Now after the FED, everything including Bitcoin is going down. The FED is now hiking rates, selling bonds from their own holdings and at the same time providing near unlimited fresh liquidity to banks in exchange for government bonds. Crazy....

Bitcoin has completely decoupled from stocks. Finally trading more like a safe haven asset again. After Bitcoin has had its run, altcoins always follow but with higher beta. I hope we get a taste of that this weekend!

Insane days!!

Panic everywhere, cryptos oversold, Bitcoin back at USD 20k. I am buying here, using our cash position. I stay away from DeFi as this sector will see a tough 2023 with government bond yields at 5% and venture capital firms who were the biggest players here in the past 2 years deeply in trouble. I like good old coins that are not owned by overleveraged players, are not securities in the regulators eyes and have low inflation rates. I add a few other projects that I like and that have time proven working blockchains and products.

Sold most cryptos this morning and held cash during todays sell-off as things looked fishy and lots of forced selling is happening these days. There are for example the bankrupt firms whose assets are being sold and the US Gov selling certain Bitcoins they confiscated in the past. To be honest it looks a bit orchestrated to do all the selling at the same time, but maybe thats just coincidence.

On top, equities also had a bad day and some banks in the US are nearing bankrupty because they are heavily invested in startups and biotechs.

I am buying some solid currency coins like Litecoin here but just with part of the cash as I do not expect a new rally before the weekend.

After the drop in Bitcoin last week I reinvested part of the cash. Today I listened to the hearing "Grayscale vs SEC". It really seems that the SEC has very weak arguments for why they disapproved a Bitcoin spot ETF while approving a Bitcoin futures ETF. The result today is that people are buying Bitcoin Trust shares and selling Bitcoin because they think it is more likely to become an ETF. Altcoins are attractive again, market has cooled off and I bought a little more.

Interest Rates are going through the roof and USD is strong. Altcoins had nice runs and the bankrupt firms Voyager and Celsius are liquidating crypto assets to pay back creditors. Not a good mix at the moment and I prefer to stay in cash. You can watch Voyager sending assets from this address to Coinbase and receiving USDC: https://t.co/VW8o8dBQtq

In the next weeks, two events are important.

1. Grayscale vs SEC hearing on March 7th because any indication that a conversion of the GBTC trust into an ETF is more likely might be bad for Bitcoin short term. Why? Traders will sell Bitcoin to buy the Bitcoin Trust shares until the discount is reduced. Numbers are big here.
2. February 28th is the date they will start testing the Ethereum Shanghai upgrade which might be implemented in March already - if successful. The upgrade will enable early ETH 2.0 stakers to unlock their tokens and do whatever they want with them. There will probably be a limit of 50k ETH per day. I would expect ETH weakness before the upgrade and outperformance thereafter.

The crypto market has gotten from warm to quite hot in the past days as the premium between Binance Futures and Coinbase Spot has indicated. Lots of "narratives" pushed for example "china related coins" up a lot. I was too cautious to chase those moves so we missed out on some of them. Today the market is sobering up but could go a bit lower I think.