Luke

Satoshi likes Cicada 3301

[Project Eleven @projecteleven]

🚨 Google has sounded the quantum alarm 🚨

Today, they released groundbreaking progress towards breaking crypto using a quantum computer.

TLDR - Existing cryptography is dead. Mempool attacks are real. We must migrate to post-quantum now.

Thread 🧵

[Trung Phan @TrungTPhan]

DeepSeek founder claiming its model cost $6m then (hypothetically) having his quant fund short Nvidia — which is down 16% (~$500B) today — would be “Soros Breaking the British Pound” for AI age.

[unusual_whales @unusual_whales]

BREAKING: President Trump signs executive order to ban central bank digital currencies.

[Luke @LukeRobertsZA]

@cointradernik 2012 was the same

[Nik @cointradernik]

You’re being gifted an opportunity here tbh

[Alex Krüger @krugermacro]

FOMC takeaways and implications for risk assets

The Fed finally began its largely anticipated easing cycle, and it seems it has found the highly elusive sweet spot. By delivering a 50bp jumbo cut, it quieted fears of those thinking the Fed is falling behind the curve. While by forecasting only 50bp further cuts in 2024, it signaled that it is in control and not in reactionary mode.

I've been repeating like a broken clock for the last year and a half that the US economy is doing very well. Because it is. And this is crucial for risk assets.

Historically, when the Fed begins its easing cycle with no recession, equities have rallied 10% in six months, while if the if the Fed begins the cycle in a recession, equities have fallen by 12%.

This is bullish for bitcoin as well, but its path is heavily dependent on who wins the election. For alts, go max long early in Election Night if Trump is coming up ahead in the counts. That's my plan.

"I don't see anything in the economy that suggests the likelihood of a downturn is elevated. You see growth at a solid rate, you see inflation coming down, you see a labor market that's still at very solid levels". - Powell.

The key thing to watch for when it comes to recession odds is layoffs. Is unemployment increasing because job openings are slowing down, or because people are getting fired?

The following was an interesting exchange on the topic that took place at yesterday's FOMC:

Q: Rising layoffs - if that were to happen wouldn't the committee already be too late in terms of avoiding a recession?

JP: We're not seeing rising claims, we're not seeing rising layoffs, and we're not hearing that from companies that that's something that's getting ready to happen.

It's also important to set expectations right. US equities are not cheap. S&P forward profit margins are at record highs. And the Fed cutting rates does not mean that the US is going back into a real negative rates environment any time soon. That is a very long way off.

The market is extremely more dovish than the Fed into 2025. This is rare. The Fed signaled they forecast Fed Funds down another 150bp by end of 2025 (3.25%-3.5%). Meanwhile the market is pricing a median target rate of 2.75%-3.00% by end of 2025, with the left tail going down significantly further.

This is basically telling you that market is pricing a 25% hard landing probability. Under normal circumstances, the Fed lowering rates further/faster would be bullish. Not so in this case. We would heavily prefer the Fed not to go too dovish and meet the markets' expectations.

Finally, it was noticeable how Powell tried to actively avoid saying the word recession. Journalists tried to get him to go that route, and he avoided it. In fact he only said "recession" once, and he quickly corrected himself and changed to "downturn". Going forward, if on any speech he offers the word recession voluntarily, or repeats it a few times in the Q&A, can see the market selling off aggressively driven by algos.

[Watcher.Guru @WatcherGuru]

BREAKING: 🇺🇸 Federal Reserve cuts interest rates by 50bps for the first time in 4 years.

[Sean Linehan @seanlinehan]

Imagine you own a large apartment complex.

France says, "It is a legal requirement to put microphones in every room and let us listen."

You say, "No, people should be able to have private conversations."

They arrest you.

The digital equivalent just happened to Pavel Durov.

[Balaji @balajis]

Telegram founder Pavel Durov arrested in France. His “crime” appears to be enabling free speech online.
https://t.co/7zAhPg5Tjs

[Eric Balchunas @EricBalchunas]

Bitcoin ETFs back to inflows on Wed, after two days of very mild outflows representing just 0.5% of total aum, meaning 99.5% of the money hung tough in face of a -14% Monday and -21% week. $IBIT saw no money leave at all, yet traded $5b, a total freak. I'm bullish as it gets re ETF investors' intestinal fortitude (in all asset classes) but even I'm surprised here. I was expecting 2-3% of the aum to leave and declare that as 'strong'

[Arkham @arkham]

You guys sold all your coins

… But

BlackRock
MicroStrategy
Grayscale
Fidelity

didn’t.

[zerohedge @zerohedge]

Biggest 2-day drop for the Nikkei in history, surpassing Black Monday

[zerohedge @zerohedge]

VIX in context: 3rd biggest crisis in history.

[The Kobeissi Letter @KobeissiLetter]

BREAKING: The volatility index, $VIX, is now trading above 65, a level only seen 2 previous times in history.

The only 2 times the $VIX has traded above 65 were the 2020 Pandemic and 2008 Financial Crisis.

This puts the $VIX up a whopping 550% from its July 2024 lows.

As a result, the S&P 500 has now erased $5 TRILLION of market cap over the last month.

Buckle up.

[Riley Read-Only @HotForMoot]

As a kid you’re anti-guns (guns are literally made to kill people, why should anyone have them!?) until you read about or live through enough stuff like this.

- 1933 Nazi germany confiscates all firearms (found and collected using firearm registration records required by a 1928 law)
- Consolidation of power by adolf hitler and complete suppression of political opponents

- 1929 law in Soviet Union makes private gun ownership illegal
- Jospeh Stalin implements “great purge” millions of people (inclusing political dissidents) arrested, exiled, and executed

- 1949 Communist Party of China implements strict gun control
- Mao Zedong enforces Great Leap Forward and Cultural Revolution, over 40 million people die

- Myanmar 1962, strict gun control laws enforced
- the Junta establish authoritarian regime that lasts decades (marked ofc by severe repression and human rights abuses)

- 1975 Khmer Rouge disarm civilians in Cambodia
- Pol Pot carries out mass executions and atrocities from 1975 to 1979

- 1979 Islamic Revolution in Iran, new regime imposes strict gun control measures
- Iranian government uses these laws to consolidate power and suppress political opposition, establishing authoritarian theocracy (ongoing)

- Zimbabwe 1980, government led by Robert Mugabe enacts strict gun control measures
- Regime becomes increasingly authoritarian, using the disarmament to suppress political opposition and maintain control

- 1994, Rwandan government enforces strict gun control laws, limiting access to firearms for civilians
- Rwandan Genocide results in deaths of ~800,000 Tutsis and Hutus, who had no way to defend themselves

- 2012 “Control of Arms, Munitions, and Disarmament Law” in Venezuela
- Increased authoritarian control and suppression of political opposition under Nicolás Maduro from 2013 to right now

And bro I’m not even mentioning all of them

[Watcher.Guru @WatcherGuru]

JUST IN: 🇺🇸 SEC permanently suspends its investigation into Ethereum.

[Luke @LukeRobertsZA]

@inmortalcrypto I actually just laughed. Couldn't do much else and the memes were amazing

[Jon Erlichman @JonErlichman]

Jeff Bezos on handling stress.

[Watcher.Guru @WatcherGuru]

JUST IN: Ethereum is effectively deemed a Commodity, Coinbase Chief Legal Officer says.