Stay up to date on Green Candle by subscribing to our newsletter and following us on Twitter, Instagram, and YouTube!
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:
Australia debuts a crypto miners ETF: The Cosmos Global Digital Miners Index (ticker DIGA) launched in Australia this week. The fund, which was designed by Cosmos Asset Management, tracks companies that generate at least 80% of their revenue from digital asset mining and infrastructure, such as Marathon Digital, Riot Blockchain, Hive Blockchain Technologies and Hut 8 Mining Corp. Cosmos CEO Dan Annan said that “our initial look into the asset was to launch a Bitcoin ETF...but as we did our analysis and looked at the picks and shovels of companies involved, we saw an opportunity to bring investors DIGA as a way to give investors exposure while we work through the exchange and regulation challenges.” It looks like BTC ETFs are expanding globally.
Speaking of BTC ETFs: Last week saw the massive debut of ProShares BTC futures ETF (ticker: BITO), which was the fastest ETF to surpass $1B in assets held. Valkyrie also debuted their BTC futures ETF (ticker: BTF) last week, which traded $10M in its first five minutes. Several other BTC ETFs remain under review by the SEC but are expected to launch in the coming weeks, including those from VanEck, NYDIG/Stone Ridge, and Fidelity’s Wise Origin Bitcoin Trust.
El Salvador BTFD: El Salvador took advantage of the midweek drawdown and bought 420 (winky face) new bitcoins. The Salvadoran government has now purchased a total of 1,120 bitcoins, currently worth more than $68 million. Their president Nayib Bukele took to Twitter to announce the news:
Mastercard partners with crypto exchange Bakkt: Payments giant Mastercard and crypto exchange platform Bakkt announced a partnership on Monday. According to the announcement, their partnership aims “to make it easier for merchants, banks, and fintechs in the U.S. to embrace and offer a broad set of cryptocurrency solutions and services...Bakkt extends Mastercard’s ecosystem of cryptocurrency partners enabling crypto-as-a-service, which provides quick access to cryptocurrency capabilities.” This is not the first of such partnerships - Blockfi offers a credit card powered by Visa and Coinbase currently has a waitlist for their Visa-powered card.
FDIC wants banks to custody your crypto: In an interview with Reuters, Jelena McWilliams, the chairman of the Federal Deposit Insurance Corporation (FDIC), said that a team of regulators was working on a roadmap to allow banks to hold cryptocurrencies on their balance sheets. Don’t let this news fool you - they’re doing this because they want to seize as much regulating power over your digital assets as possible. Don’t take my word for it - McWilliams went on to say “if we don’t bring this activity inside the banks, it is going to develop outside of the banks … The federal regulators won’t be able to regulate it.”
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 greencandleit@gmail.com or DM us on Twitter (@Greencandleit)!
A look on chain:
Let’s take a look at on-chain data from Glassnode!
Price update: After reaching a new ATH last week, BTC tragically crashed to levels not seen since the previous ATH. We’re currently fluctuating between 59-62k and hopefully building a nice layer of support. As of this writing, in the last week, BTC’s USD price is down 2.3%; in the last month, it is up 49.8%; in the last year, BTC price is up 363.9%.
S2F Model Update: Price currently remains well below the stock-to-flow model. In fact, the model has price on October 28 at $107,453 USD, leaving us roughly $47k 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 remains positive but relatively low (that is, it is not spiking in ways similar to previous price jumps). This suggests that HODLers are doing what they do best, even when price jumps.
New Addresses: When prices hit new ATHs, we typically see a large spike in new addresses. Interestingly, despite the new ATH last week, we did not see a large spike in new addresses.
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:
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!
Stay up to date on Green Candle news by subscribing to our newsletter and following us on Twitter, Instagram, and YouTube!
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.