👀 Bitcoin breaks the 30k barrier

GM, GM. Can you guys believe it ?!! It finally happened, BTC hit $30k for the first time since June 2022… Wait that’s only been ~10 months, why does it feel so much longer ? Luckily, today’s edition doesn’t involve much drama so that means we can do a some what deep analysis on Bean Boy’s two favorite coins, Bitcoin and Ethereum. Let’s see what’s in the pod for today.

How we looking today?

If you told me 6 months ago (when BTC was around ~16k), that BTC would hit $30k in half a years time, I would’ve called you crazy. Look where we are now, almost 50% up, cryptocurrency is truly a wild market.

WHAT’S BEHIND THE PUMP ?

Now, to all my crypto enthusiasts that wants to know why their Bitcoin and Ethereum holdings are valued higher, hopefully everyone bought below 30k and 1.9k, let us give you the run down. Before I ramble on, this deep dive will not include crazy technical lines and charts, but rather, utilise a general and logical approach. So rest assured, you’re getting the best non-biased, brief, and informative piece of analysis out there.

To start off, I asked myself, who is buying ? Luckily, this one’s pretty simple to answer. Remember that time, when BTC and ETH was at its ATH, and then it plummeted down for ~1 year straight? Guess who was selling… That’s right, people like you and me, institutions, funds, investors, all sold. The difference was that most large players / institutions sold more in volume and at a better price in comparison to retail traders.

If you apply this same principle it’s pretty obvious to see who’s driving up the price, the same people that sold their BTC and ETH, alongside new investors that have joined the crypto market (they will never be the same again). In addition, I bet you most funds and institutions got a much better buy in than majority of retail traders. They always manage to win whether price goes up or down.

Now that we figured out the buyers, we just have to determine, why buy now rather than later? This one is pretty straightforward too, people are predicting a slowdown in growth, and in turn a loosening of monetary policy by the Federal Reserve over the course of 2023. This means that the market is forecasting smaller interest rate hikes or even a pivot in due time. A simple economic rule is, if interest rates are high, people borrow/spend less and save more, if it’s low, people borrow/spend more and save less. When people have more disposable income this translates to more people trading, investing and buying financial products, including crypto! NFA, the crypto market can and probably will correct even when financial conditions are loosened.

On top of this, recently, we’ve had several large bank runs and bankruptcies such as, Silicon Valley Bank and FTX. With so many large institutions unable to safely manage their customer’s funds, a lot of confidence towards these institutions have been lost. Because of this, more people are looking to become self custodians of their own financial assets. What asset is better than BTC for this job? It’s decentralised and non-custodial, thus, it’s perfect in ensuring that your funds are truly YOUR funds. This only applies to users who hold their BTC in a non-custodial wallet.

This may also be the reason behind BTC’s outperformance against Ethereum and other ALT coins. Due to soooo many recent black swan events, investors wants to invest in financial products with minimal risk. Whilst Bitcoin’s primary mission is to act as a store of currency, Ethereum is intended for complex smart contracts and decentralized applications. Therefore, the risk appetite for Ethereum isn’t as appealing to investors as Bitcoin, but this doesn’t mean a season for alt coins and Ethereum won’t come. Oh, did I mention the Ethereum Shanghai upgrade will happen in around 30~ hours from now? This means, 18,112,471 ETH worth $34B will be unlocked & investors can begin to unstake (and sell). Possibly why you see Ethereum not as performing as well.

WHERE DID ALL THE MONEY GO ???

Recently, February’s round of legal expenses for bankrupt crypto exchange FTX has been published. Lets break it down.

The FTX chief, Ray, was billed at $1,300 per hour and reported working 255.9 hours for the period of March 1 to March 31. That’s 8 hours a day… I would also work 9-5 if it meant I get paid ~$10,000 a day. Now, this makes his fees a whopping $327,470, with the remaining $1,703 for airfares, lodging, transport, meals and other expenses.

Onto the law firms, just a disclaimer before we continue, it might be a very good investment to actually start a law firm based off these numbers.

• Law firm Quinn Emanuel Urquhart and Sullivan sought a total of over $2.7 million in reimbursements, partners billed between $1,246 and $1,917 per hour and associates billed between $747 and $1,183 per hour.

• Law firm Alvarez and Marsal and forensic investigation consultant Alix Partners detailed their February fee statements totaled over $11.9 million and around $3.6 million

• Law firm Sullivan and Cromwell, billed a total of over $13.4 million.

• Investment banking firm Perella Weinberg Partners billed $77,891.

• Bankruptcy co-council Landis Rath and Cobb invoiced $582,604 for February.

Can I remind you that this was only 1 month’s worth of expenses ??? Apparently, previous months reimbursement expenses were just as exorbitant…

PEAS IN THE POD

• Tether blacklists validator address that drained MEV bots for $25M. Bro…. we touched on this in the last edition. This is not right…

• G20 countries aim to develop global framework against crypto-related risks. Is this the start of something similar to Interpol but directly for crypto ???

• MicroStrategy's $4 billion bitcoin bet in the green as price hits $30,000. The mad man has finally done it! If you’re not sure who I’m talking about check out yesterday’s edition here.

HOW YOU BEAN - A READERS CONFESSION

How is Bitcoin at 30k right now … I’m legit shaking and lost for words. I sold all my Bitcoin at 16k as it was crabbing there for like a month and more and I thought it was bound to wick to 14k and come back up (this is where I planned to buyback) like all the Twitter influencers said. Now, all my savings are sidelined when I could’ve been up x2 by now… I hate this market.

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.