GM friends.
Filmmaker Cullen Hoback, with ample amounts of direct evidence and unassailable logic, revealed Satoshi Nakamoto’s true identity during Tuesday night’s premier “Electric Money”. Pack it in folks, it’s all over.
Pour that coffee and buckle up. This is your mid-week crypto update. ☕️📰
Here’s what’s in today’s issue:
- Chart of the day: MicroStrategy to the moon!
- David shares his thoughts on who Satoshi actually is, the meme coin supercycle, institutional investors are short on BTC shorts, & Crypto.com suing the SEC.
- Today on chain.
- Altcoin Alpha.
- Lark’s technical analysis on the market.
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Chart of the Day
Who needs bitcoin when you’ve got Microstrategy.
On Tuesday, MSTR hit $198.49. The stock’s ATH is $200, as set on March 27th. Regarded as a levered bitcoin investment, MSTR’s price action tracks pretty close to bitcoin. So the big question now is why is MSTR basically at ATHs when bitcoin is still 13% under its mark?
This is the huge conversation on X right now. Optimists say that it’s smart money packing their bags for an incoming bitcoin pump. Pessimists claim that it’s classic FOMO.
News Now
HBO Documentary Claims Peter Todd is Satoshi
The documentary “Money Electric: the Bitcoin Mystery” premiered on HBO Tuesday evening. The film delved into the history of bitcoin, and its grand climax is that Peter Todd, the Canadian bitcoin core developer, is Satoshi Nakamoto.
Todd, age 39, has admittedly been involved with bitcoin since 2010. He’s well-known in the space as a long-time core developer. The film-maker behind Money Electric is Cullen Hoback, who is best known for identifying the person behind the QAnon conspiracy theory.
Here’s the evidence as presented by the documentary for why Todd is Nakamoto:
- In 2010, Todd responded to one of Satoshi’s posts on the BitcoinTalk public forum. Hoback argues that Todd’s post was meant to be a continuation of “Satoshi’s” post, but that Todd accidentally made the continuation from an alternative account with his real name on it, rather than from his pseudonym account.
- Todd knew Adam Back (another early-days cypherpunk), and Back had exchanged emails with Satoshi.
- Todd is Canadian, and Satoshi often used British and Canadian spellings.
- Todd had an interest in cryptography from a young age, and possessed the technical ability to create bitcoin.
The last three pieces of “evidence” are absolutely horrid. Crypto X mocked Hoback’s claim, with many (correctly) pointing out that Hoback didn’t present a shred of direct evidence, but rather relies entirely on the circumstantial kind.
In response, Todd has issued multiple statements that he’s not Satoshi. Here’s a non-exhaustive mash-up of them, spanning from direct replies to Hoback, to statements to journalists.
“This is going to be very funny when you put this into the documentary, and a bunch of bitcoiners watch it . . . [Hoback is] grasping at straws . . . It’s ironic that a director who is also known for a documentary on QAnon has resorted to QAnon style coincidence-based conspiracy thinking here too . . . I will admit you’re pretty creative. You come up with some crazy theories. It’s ludicrous . . . So yeah, of course I’m Satoshi, and I’m Craig Wright.”
What’s the Memecoin Supercycle?
Another popular conversation of late (on Crypto X) is the “memecoin supercycle.” The term is attributed to Murad Mahmudov, a well-regarded crypto investor and trader.
On September 27th, Murad gave the key-note presentation at Token2049 Singapore, and it’s like the dude was dropping hand grenades on most of the industry. Watch the keynote if you have the opportunity, and Lark will be releasing a fuller Youtube video on the subject within the next day or two, so be on the lookout for that.
But here’s the TLDR.
According to Murad, the crypto industry is in the midst of a memecoin supercycle. Meaning, the biggest 2024 gains by a long shot, when filtered by category, are the memecoins, and this will only continue through 2025.
But Murad’s more interesting point is why. He puts his reasons into two large buckets: internal and external factors.
Starting with the internal, the crypto ecosystem has been flooded with an over-production of altcoins that claim to offer revolutionary technology, but most do not. The vast majority of these tokens are extremely overvalued by the time they go public (i.e. think insiders, VCs, etc), and retail is sick of getting dumped on. Moreover, these valuations aren’t even close to being justified, especially when looking at the corresponding token protocol’s revenues and productivity metrics. And finally, retail is waking up to all of this, as the 2024 price action indicates.
Then there’s the external reasons. A prevailing sense that the economic deck is stacked against retail (i.e inflation, money debasement, AI job displacement, wealth inequality, etc) is pushing the lower and middle classes to take bigger risks (i.e. speculating on memecoins), and this won’t be stopping any time soon. Then there’s the larger societal trends (i.e. loneliness, increased time spent online, decline in religion, meaning crisis, etc) that in many ways make memecoins attractive (i.e sense of identity, joining a group / cult, etc).
Needless to say, Murad’s thesis is extremely intriguing, and something that – at the very least – you should be aware of.
Institutional Investors are Increasingly Short on BTC Shorts
Look at this chart from CryptoQuant.
This is the net position of all bitcoin futures on the Chicago Mercantile Exchange. If you zoom in to the very tail-end, you’ll see that net short futures positions bottomed-out, and have since gone flat, starting in the first week of August, when correspondingly, bitcoin bottomed to the mid-$50Ks.
Zooming back out, this chart shows exactly what you’d expect from the smart money (i.e. asset managers, dealers, and hedge funds are the main players in the CME futures markets). These guys pull back their short positions when bitcoin hits cycle bottoms, and they crank them up at cycle tops.
With that in mind, now compare the current net short levels to those at the 21/22 cycle top. It’s not even in the same ballpark. Rather, current net shorts are much closer to the numbers seen during the 22/23 bear bottom. Therefore, the data suggests that the smart money believes bitcoin is currently at a price bottom.
Crypto.com Sues the SEC
More legal BS with the SEC.
On August 22nd, the SEC sent a Wells Notice to Crypto.com. A Wells Notice means that the SEC is about to pursue an “enforcement” action against you. The SEC is alleging that Crypto.com is operating as an unregistered broker/dealer by selling tokens other than bitcoin and ethereum.
So on Tuesday, Crypto.com sued the SEC. CEO Kris Marszalek said the purpose of the suit was to “protect the future of crypto in the U.S.” and limit the SEC’s “unauthorized overreach and unlawful rulemaking”. Crypto.com’s decision to strike back is the same move made by multiple other exchanges and companies, most notably Coinbase and Ripple.
All of this would have caused some downwards price action a few years ago. But in the current environment, the markets barely flinched. We’re winning.
Today On Chain
Aerodrome just hit a new ATH with $1.19B in total value locked on-chain. As Base’s leading DEX, Aerodrome is blowing up because . . . well . . . Base is blowing up. And the latter is doing well in part due to it becoming a popular destination for memecoin trading.
Several of Aerodrome’s liquidity pools are currently offering some pretty juicy APYs, even on very conservative market cap coins like stables and ETH.
Moreover, AERO is one of the few tokens that actually captures revenue from the protocol’s trading fees.
Altcoin Alpha
- Mantra [OM] is set to launch its mainnet sometime this month. Mantra is an L1 purpose-built for the secure tokenization and trading of real world assets.
- Scroll is planning on airdropping its new, native token – SCR – on October 22nd. The token will also be launched on Binance’s Launchpool. Scroll says that SCR will start as a governance token, and then shift to a governance and utility token.
- Stacks [STX] should today be announcing the launch of its Nakamoto Upgrade. Nakamoto is supposed to make the Bitcoin L2 much faster.
Market Analysis
Welcome back to another week of TA. Let’s get it!
This week of course it has all been about macro.
Last week we saw markets sell off on fears of escalation of the Israel- Iran conflict. Fears around a US port strike were eased quickly as the port strikers delayed until January. Chinese markets also sold off today as investor expectations of an even bigger stimulus package were not met. All of which is to say that Bitcoin and the wider crypto market remains very sensitive to risk attitudes in global markets.
Most of this is short term noise. The real signal, in my opinion, continues to be liquidity. M2 (the money supply) is on the rise globally and central banks are easing monetary conditions through a variety of measures including but not limited to rate cuts.
So let’s talk Bitcoin.
First, the monthly chart.
Let me ask you a simple question. Does this look anything like a market top? The answer is no. The orange arrows point to the two previous tops. It does look like a brutal and extended period of accumulation though. 😬
The recent sell off did see the 200 day EMA (blue line) hold as support, which is encouraging. Ideally we continue to see this holding as support on any further sell offs.
At the time of writing we are trading above the 50 day EMA (yellow line). As long as the price maintains above this line it favors bulls in the short term.
CLICK HERE to go Premium and read the rest of this week’s Market Analysis – Premium subs can read Rekt capital’s full report.
Final Notes
Thank you so much for your support, and I truly hope that today’s issue will give you insights needed to help you master your wealth.
If you are reading this it means you are on the free version of the Wealth Mastery Investor Report, which is great for news and tips on the crypto markets.
If you really want to take advantage of fastest growing asset class EVER, I highly recommend that you check out my new altcoin course: Mastering Altcoin Investing
In this course we’ll teach you all about how to spot, choose and acquire the winning altcoins of the next bull market.
Learn how to build your portfolio so that growth is ensured and risk is mitigated. Let me help you build a strategy that’ll change your life forever in the upcoming bull run.
See you next time!
Lark and the Wealth Mastery Team
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Legal Disclaimer
Wealth Mastery (Lark Davis, and the Wealth Mastery writing team) are not providing you individually tailored investment advice. Nor is Wealth Mastery registered to provide investment advice, is not a financial adviser, and is not a broker-dealer. The material provided is for educational purposes only. Wealth Mastery is not responsible for any gains or losses that result from your cryptocurrency investments. Investing in cryptocurrency involves a high degree of risk and should be considered only by persons who can afford to sustain a loss of their entire investment. Investors should consult their financial adviser before investing in cryptocurrency.
You can find a full disclosure of all my crypto & venture investments here.
Hi! My name is Lark Davis!
I’m a cryptocurrency investor with years of experience and I’ve been making consistent profits in the crypto space.
I’m passionate about helping others do the same, so I run multiple educational channels on crypto investing.
