In our Friday articles, we take a deep dive into the current state of Bitcoin. We previously published a series debunking the FUD surrounding Bitcoin - you can find those links at the bottom of this article. Every Friday we will continue to publish brief State of the Coin newsletters to keep subscribers up to date on BTC with both on-chain analytics and off-chain news from the Bitcoin industry. For full disclosure, Brandon and Daniel are strong believers in Bitcoin and both have allocated portions of their portfolios to BTC (HODL baby).
Let’s take a look at the State of the Coin
A look off chain:
ProShares BTC ETF (BITO) debuts with a bang: ProShares Bitcoin Strategy ETF (ticker BITO) began trading on Tuesday and opened with an absolute bang. It ended the trading session up nearly 5% and had traded ~$980M in volume. By the end of the trading session Wednesday, volume had exceeded $1.2B, making BITO the fastest ETF to reach $1B ever.
Speaking of ETFs, more are on the way: While ProShares BTC Strategy ETF was the first to list, others are not far behind. Multiple sources are saying that Valkyrie Bitcoin Strategy ETF will launch Friday (today, but sorry, we write this Thursday night) and Vaneck’s bitcoin futures ETF will likely launch some time next week. Even if you’re not keen on holding a derivative-based ETF, this news certainly cements the fact that BTC is here to stay in the U.S. Now that mining has spread away from China and it’s clear that major Western world governments will not kill BTC, I’m left wondering what FUD they’ll try to feed us next.
Chainalysis to add BTC to their balance sheet: On Tuesday Blockchain analytics firm Chainalysis announced that they would be purchasing an undisclosed amount of bitcoin and adding it to their balance sheet. Chainalysis CEO Michal Gronager said: "Chainalysis is laser-focused on its commitment to building trust in cryptocurrency as a digital asset, and we are thrilled to be adding Bitcoin to our corporate investment portfolio...This is Chainalysis’ first acquisition of cryptocurrency, and we will continue to pursue other digital assets as potential future investments.” It’s great to see crypto companies putting their money where their mouth is and buying the products their companies are built around.
Pimco is dabbling in crypto: Fixed-income giant Pimco is planning to wade deeper into the waters of crypto assets. Although some of Pimco’s hedge fund portfolios already include crypto, CIO Daniel Ivascyn said in a recent interview that they’re “...looking at potentially trading certain cryptocurrencies as part of our trend-following strategies or quant-oriented strategies, then doing more work on the fundamental side...So this will be a gradual process where we spend a lot of time on the internal diligence side speaking to investors. And we’ll take baby steps in an area that’s rapidly growing.” This news just reiterates what we’ve seen from major financial firms over the last 6 months - they’re buying in. But, it’s worth thinking about whether “baby steps” will be enough to keep up with an asset like BTC, which is growing exponentially.
Coinbase becomes an exclusive partner with NBA, WNBA, USA Basketball: The popular and publicly traded cryptocurrency exchange Coinbase has partnered with the National Basketball Association (NBA) to become the exclusive cryptocurrency platform partner of the NBA, Women’s National Basketball Association (WNBA), NBA G League, NBA 2K League, and USA Basketball. Several individual athletes (across many sports) have already made headlines talking about crypto, but for an entire league to partner with an exchange reaffirms that digital assets are becoming mainstream and further embedded in our social fabric.
Feature of the Week
Every week, we reach out to members of the Bitcoin community to see where they stand on BTC and to ask what they’ve been up to lately. This week we’re happy to share a quick word from @RandyBTC2000, who was kind enough to share a bit of his story with us on one of our recent Twitter Spaces. After the Spaces, we knew we had to get him to tell us more, so here is part of his incredible story:
I'm a 39-year-old living with debilitating physical and severe mental disabilities. And due to the ongoing, worsening problems in the US and around the world, as well as the stupid rules social security places on me, my chances and hopes of landing a job and therefore gaining independence evaporated. 20 years of my life have passed since I turned 18 with no luck in getting a job or having any real success. A lot of this has to do with employers being scared that my disabilities would hinder my ability to work. Further, any money I did try to save was being evaporated by inflation.
Anyway, at one point I had turned suicidal and I didn't feel like I had much hope left to grasp on to in my life...but here's where things changed for me. I saw Bitcoin back when it was first released...I didn't understand it though, and like many others didn't think much of it at first. However, as time went on I continued to hear more rumblings about it, so I got curious. This was right around the height of my depression, when I was looking for anything to bury the pain both mentally and physically that I was dealing with on a daily basis. When I looked more into it, however, Bitcoin wasn't just a fad. It struck me as a fundamental change in the way we handle money and it provided hope that a more equal opportunity can be given to all, no matter your skin color, background, or in my case, disability.
For the first time in my life I had felt a strong hope that I had never felt before and so I dug my heels in and learned everything I could about Bitcoin - and oh man did it wake me up. My initial investment was during the crash of the last big bull run. That taught me Rock solid conviction. When Bitcoin bottomed at $3,200 and I saw everybody was bearish AF, I knew better. I took a look at the fundamentals; I zoomed out and realized that this could be a bottom but I wasn’t sure and honestly I wasn't trying to call a bottom but I had a gut feeling when Bitcoin was around 3,800 I threw in a large amount. I HODL that to this day and it has become a pillar of Hope that has helped me fight through my depression and I now feel like I have a fighting chance to make my life better in this world. A world that up until this point had only taught me that I am disabled and that meant I was limited... When in reality I am not. I just think differently.
Be sure to follow Randy on Twitter (@RandyBTC2000) and maybe shoot him a message about helping him get to his lifetime goal of being a whole coiner!
We’re always looking for guest writers! If you or someone you know would like to be featured on State of the Coin as a contributor, let us know! You can email us at firstname.lastname@example.org or DM us on Twitter (@Greencandleit)!
A look on chain:
Let’s take a look at on-chain data from Glassnode!
Price update: We’ve reached a new ATH! Uptober has not failed us - we started the month with a bang and this week brought in a new all time high of $67,016 on Wednesday October 20th. Interestingly, this new ATH came 527 days post halving, just two days longer than the ATH after the second halving. As of this writing, in the last week, BTC’s USD price is up 6.4%; in the last month, it is up 54.6%; in the last year, BTC price is up 391.7%.
S2F Model Update: Price currently remains well below the stock-to-flow model. In fact, the model has price on October 21 at $109,061 USD, leaving us roughly $46k away from predicted price. Although we remain below model predictions, the model tends to perform well immediately prior to halving events (see red circles below). The model has a predicted USD value of $121k in March of 2024, when the next halving event is expected to occur. Remember, BTC is a long term investment, not a “get rich quick” vehicle. To learn more about the S2F model, check out this article by PlanB.
SOPR: The Spent Output Profit Ratio (SOPR) is computed by dividing the realized value (in USD) by the value at creation (USD) of a spent output. Or more simply: price sold / price paid. Values greater than 1 indicate that coins are being sold for profit (typically bullish) and values less than 1 indicate coins are being sold at a loss (typically bearish). SOPR has now remained above 1 for several weeks, indicating some profit taking. However, despite the recent jumps in price, we’re not seeing large positive spikes in SOPR similar to those seen in the April run up. This suggests that HODLers are doing what they do best, even when price jumps.
BTC Meme of the Week! What would the BTC community do without memes? Every week on State of the Coin, we feature our favorite meme of the previous week. If you create or see a meme that you like and want us to consider featuring it, tag us on Twitter or instagram (both @Greencandleit)! Here’s a good one we came across this week on Twitter, from @fullmetalhodl2:
New to Bitcoin and looking to learn more? Check out our introductory series, where we walk through common misconceptions about the world’s leading cryptocurrency!
Happy Friday everyone - get after it this weekend!
Brandon and Dan
Disclosure: The authors of this writing hold positions in cryptocurrency mentioned in this article. That cryptocurrency is Bitcoin. The article was written by Daniel Kuhman, Brandon Keys, and occasionally a guest writer; it expresses the author's own opinions. They are not receiving compensation for it. The information presented in this article is for informational purposes only and in no way should be construed as financial advice or recommendation to buy or sell any stock or cryptocurrency. None of the authors of this article are financial advisors. We encourage all readers to do further research and do your own due diligence before making any investments.