Water to wine, FUD to FOMO
Could we have finally found a momentary bottom?
When it rains, it pours. The adage held true this week, as Bitcoin skirted $29.5k lows for the first time since June, before mounting a strong recovery to above $32k. While the price action alone still places us firmly within the trading range that has dominated the market since May, bullish rumblings seem to be growing steadily louder.
Wednesday evening saw a meeting of rare significance in the industry, as Twitter CEO Jack Dorsey and ARK Investments founder Cathie Wood joined The B Word Conference to discuss the future of blockchain alongside Elon Musk, chief of both Tesla and Space X.
Left to right: Jack Dorsey, Cathie Wood, and Elon Musk
A far cry from the unrestrained maximalism of Miami BTC, the crypto heavyweights discussed adoption, regulation, and environmental concerns in a somewhat muted encounter. Within minutes of the stream going live, Musk disclosed his holdings nonchalantly — confirming that in addition to Tesla, SpaceX also holds BTC, while he personally holds BTC, ETH, and, of course, his beloved DOGE.
Those who thought the days of the Elon Effect were behind us received a jarring wake up call as BTC surged to $32.8k within moments of his announcement, before settling at the $32k level it had just breached.
Large holders continue to accumulate
Perhaps the biggest takeaway from the conference was Musk’s clear optimism for crypto. He relaxed his notorious opposition to the Bitcoin network’s energy usage, prompted in part by a paper co-authored by Dorsey’s and Wood’s firms, which asserts that the network incentivizes the use of clean energy. Musk, infamous for his back-and-forth on the subject, even sported a Bitcoin shirt during the call, going as far as to claim “I might pump, but I don’t dump”. We’ll take that one with a pinch of salt.
Another cloud loomed heavily over July in the form of investment firm Grayscale’s unlock of 40k GBTC from its Trust over the course of the month. The bulk of the unlock took place this weekend — perhaps partially responsible for Monday’s crash. Regardless, BTC’s refusal to drop below $29.5k indicates that GBTC sellers were met with an excited flurry of institutional buyers. In fact, ARK Investments added 450k GBTC shares to its portfolio over the past three days. The total share value amounts to roughly 420 BTC, or around $13 million at the time of writing.
ARK is not alone in its confidence to buy the dip. Alameda’s iconic quant, Sam Trabucco (henceforth to be known as Sam Tabasco of Alabama Research), published his own analysis of recent action in a Twitter thread earlier this week, stating in no uncertain terms that the derivatives powerhouse is still buying, foreseeing a tentatively bullish outlook. On-chain data also indicates that large holders (1000+ BTC) have increased sharply in recent weeks as BTC flirted with the sub-$30k region.
lookintobitcoin.com
If that’s not sufficiently bullish, JP Morgan joined the latest wave of institutional fervor by opening access to crypto funds to all its wealth management clients on Thursday, further strengthening the ever-growing case for widespread BTC adoption.
New at VALR
Regardless of the market, the deploys keep rolling! This week we’re excited to announce the launch of an update packed with new features to serve our users:
Introducing ZAR/alt simple swaps: Purchase any of our 60+(!) cryptos with ZAR, without needing to first trade BTC or ETH
More assets to auto-buy: Our auto-buy feature allows you to purchase crypto through regular debit orders, taking the headache out of dollar-cost-averaging. Try it out now with BTC, ETH, or XRP
One FREE ZAR withdrawal per month: VALR Pay is now the most frictionless payment rail SA has ever seen!