MacroScope

Topics: institutional trading, asset management and monetary policy. Tweets are opinions only and are not intended as advice.

[MacroScope @MacroScope17]

Updating the post below, since it was popular with readers.

The ability to use BTC as collateral continues to grow. This is important for any asset and it should be watched, because it increases utility and inherent value.

Coinbase recently added to its “borrow” product that lets customers borrow cash using their BTC as collateral. There are now three options. See the screenshot below (taken today).

Recap: You deposit BTC as collateral and get USDC, which is immediately convertible to USD, then a quick transfer to your linked bank account. Attractive rates. You can choose to repay the loan whenever you want, at which point you get your BTC back (so you retain any future price appreciation).

That’s a very attractive option for various types of borrowers ranging from individuals to small businesses.

I’ve been surprised by how many people -- even veterans of the BTC space -- don’t seem to be aware of how easy this process has become, or that it even exists. But make no mistake: This is huge financial innovation. And Coinbase definitely isn’t alone -- other companies also offer this product.

Keep watching as BTC collateral usage grows. Over the long term, it’s important.

[MacroScope @MacroScope17]

In the decade I’ve been posting here, I’ve never done a product review. But here’s one that may interest readers.

I tried out Coinbase’s “borrow” product. This lets customers borrow cash using their BTC as collateral. I didn’t have a need for this, but since it’s becoming a popular retail-facing product for Coinbase and other companies, I wanted to see how easy they’ve made it.

I was amazed. The entire process was simple and took just a few minutes. You deposit BTC as collateral and get USDC, which is immediately convertible to USD, then a quick transfer to your linked bank account. It’s seamless and you never leave the platform. The variable APR 30-day average is currently 4.82%.

Of course DeFi borrowing has been around a long time. But my sense is that many people in this space don’t realize how easy the process has become for the casual, non-tech user (or how competitive the APRs are). It certainly makes BTC an even more useful and attractive asset to own.

My main takeaway was “disruption.” Once you get in the trenches and see how quickly products are evolving in this space, you understand the growth potential -- and how much the legacy Wall Street firms will lose if they don’t adapt and dive in.

[MacroScope @MacroScope17]

Happening next month. I’ve gotten lots of private messages asking for recommendations. Feel free to send me one.

[MacroScope @MacroScope17]

After my trips to El Salvador, I’ve gotten lots of questions about the best times to visit.

There’s probably never been a better time than this November, especially for anyone interested in El Salvador’s emergence as a technology and AI hub:

November 10: Bitcoin Capital Summit
November 11-12: Bitcoin Histórico
November 18-19: EmTech AI Conference
November 19-20: Global Bitcoin Circular Economies Summit

Bitcoin Histórico is the big one and I highly recommend it. But they should all be interesting.

The Circular Economies Summit will take place in El Zonte (Bitcoin Beach). I’ve been there several times. El Zonte is an important place in the history of Bitcoin, and anyone who’s into BTC should try to visit. It’s also a great vacation spot.

These events in November will be valuable networking opportunities for investors interested in El Salvador, or anyone looking to start a business or just move there. You’ll also hear about young tech-focused Salvadorans, who are incredibly impressive.

This is a very easy nonstop flight from New York and other cities. Feel free to message me for recommendations on hotels and restaurants in San Salvador and Bitcoin Beach.

I’ll post links to these events in the comment section...

[MacroScope @MacroScope17]

Know a guy who managed a couple of top desks on Wall Street for many years. He’s always had a casual interest in BTC and has never seen it as anything more than an inflation hedge.

A few weeks ago, he asked me about it in the context of AI.

Always watch these types of emerging investment frameworks as they start to get traction.

(@jvisserlabs has lots of readers in the financial industry and a big part of this growing awareness comes from his work.)

[BlackRock @BlackRock]

Our latest research paper explores the growing connection between AI and digital assets and explains why broad AI adoption may drive new demand, utility and applications across the digital asset economy. https://t.co/z5T88Orble

[MacroScope @MacroScope17]

August. So far, signal.

Looking forward to the next filing.

[MacroScope @MacroScope17]

In a filing this afternoon, Tudor Investment (Paul Tudor Jones) reported owning 688,529 shares of IBIT as of June 30, valued at $22.9 million.

That's an increase from 579,083 shares reported for the previous quarter.

Remember: No one knows inflation cycles and their historical patterns better than PTJ.

Filing:

https://t.co/WRR3i0m4qa

[MacroScope @MacroScope17]

@Nickprince Thanks

[MacroScope @MacroScope17]

@MadureNiko Thanks

[MacroScope @MacroScope17]

Below was posted three years ago at BTC 25k:

"One of the keys back then was to watch the longer term charts (weekly and especially monthly) for when price levels that were previously lost were quietly regained. This led to huge profits for traders who were still in the game and paying attention, because it indicated the continuation of a long-term secular trend."

This continues to apply. If you believe BTC is repeating the long-term fundamental and technical cycle of the tech sector that started in the mid-1990s (and longtime readers know I believe this) then you want to see that same type of price pattern: levels that were previously lost getting quietly regained (amid terrible sentiment), best viewed on monthly charts.

And after the past couple weeks, that’s exactly what we’re now seeing with BTC -- and have been seeing since this post three years ago.

There are a thousand ways to look at technicals and charts. I like to keep it simple, especially if you're pairing technicals with an underlying story that's a long-term new paradigm.

By the way, over the past couple years, I've probably gotten more "thanks"-type private messages about this post than any other I've made over the past decade. You can see the number of views on it. Glad the historical perspective (and gray hair) helped some readers.

[MacroScope @MacroScope17]

Seeing lots of tweets about BTC and lower engagement/public interest. I personally find this fascinating and any trader active 20 years ago should be getting flashbacks. In terms of sentiment and interest, 2023 = 2003. You can go to the dusty finance message boards for AMZN and other eventual winners and see the same dynamic back then. Retail and fast-money desks were blown out after '99, but a new ownership base was slowly moving in as tech leaders survived and continued to build.

In terms of price action, one of the keys back then was to watch the longer term charts (weekly and especially monthly) for when price levels that were previously lost were quietly regained. This led to huge profits for traders who were still in the game and paying attention, because it indicated the continuation of a long-term secular trend. In the case of BTC, for example, a recent level to watch would be 28-30k. And so on at higher levels. I can tell you this: despite all the fundamental company analysis that Wall Street and the media like to peddle, you'd probably be surprised by how many smart institutional guys act off the charts (especially true with BTC). Self-fulfilling on the way down...and on the way up.

[MacroScope @MacroScope17]

@keithaucoin Thanks

[MacroScope @MacroScope17]

The upcoming 13F filings for the BTC ETFs should be interesting. Just a hunch.

[MacroScope @MacroScope17]

The US (and the West in general) realistically has one way out of its debt situation: a combination of growth and inflation. If policy hinders growth, inflation becomes even more of a necessity -- which ultimately makes protection like BTC even more attractive.

Keep this in mind as you increasingly see politically motivated anti-growth hysteria spread (AI, digital assets etc). The inflation part of the solution becomes even more important and inevitable.

[MacroScope @MacroScope17]

A message I got after the post below:

"Hi. Would love to have some recommendations for a solo traveler from NYC to El Salvador for the Summit + Bitcoin Histórico. This will be my first time there. Thanks!"

Another:

"Just saw your most recent post. Recommended places to stay in El Salvador? Just wife and I."

A bunch of other messages like these. Feel free to ask me for tips and recommendations.

[MacroScope @MacroScope17]

After my trips to El Salvador, I’ve gotten lots of questions about the best times to visit.

There’s probably never been a better time than this November, especially for anyone interested in El Salvador’s emergence as a technology and AI hub:

November 10: Bitcoin Capital Summit
November 11-12: Bitcoin Histórico
November 18-19: EmTech AI Conference
November 19-20: Global Bitcoin Circular Economies Summit

Bitcoin Histórico is the big one and I highly recommend it. But they should all be interesting.

The Circular Economies Summit will take place in El Zonte (Bitcoin Beach). I’ve been there several times. El Zonte is an important place in the history of Bitcoin, and anyone who’s into BTC should try to visit. It’s also a great vacation spot.

These events in November will be valuable networking opportunities for investors interested in El Salvador, or anyone looking to start a business or just move there. You’ll also hear about young tech-focused Salvadorans, who are incredibly impressive.

This is a very easy nonstop flight from New York and other cities. Feel free to message me for recommendations on hotels and restaurants in San Salvador and Bitcoin Beach.

I’ll post links to these events in the comment section...

[MacroScope @MacroScope17]

https://t.co/T2usXPZpqx

[MacroScope @MacroScope17]

After my trips to El Salvador, I’ve gotten lots of questions about the best times to visit.

There’s probably never been a better time than this November, especially for anyone interested in El Salvador’s emergence as a technology and AI hub:

November 10: Bitcoin Capital Summit
November 11-12: Bitcoin Histórico
November 18-19: EmTech AI Conference
November 19-20: Global Bitcoin Circular Economies Summit

Bitcoin Histórico is the big one and I highly recommend it. But they should all be interesting.

The Circular Economies Summit will take place in El Zonte (Bitcoin Beach). I’ve been there several times. El Zonte is an important place in the history of Bitcoin, and anyone who’s into BTC should try to visit. It’s also a great vacation spot.

These events in November will be valuable networking opportunities for investors interested in El Salvador, or anyone looking to start a business or just move there. You’ll also hear about young tech-focused Salvadorans, who are incredibly impressive.

This is a very easy nonstop flight from New York and other cities. Feel free to message me for recommendations on hotels and restaurants in San Salvador and Bitcoin Beach.

I’ll post links to these events in the comment section...

[MacroScope @MacroScope17]

https://t.co/ocQhqRmHCA

[MacroScope @MacroScope17]

https://t.co/kWnEyg3sQt

[MacroScope @MacroScope17]

https://t.co/gD5ejZ2d5s

[MacroScope @MacroScope17]

The reaffirming...

[MacroScope @MacroScope17]

An Important effect of BTC’s recent surge is the reaffirming of it in institutional managers’ minds as debasement protection. This has always been a core investment thesis for BTC, but that perception had lapsed recently.

Perceptions like this are important on Wall Street, because once established during important market events, they can last for many years and even entire careers. As a sell-side market maker in the 1990s, I still vividly remember how the assets on our desk performed during various episodes including the Asian financial crisis -- and for years after, I would instinctively look at those assets during similar market environments.

If the debasement trade continues to become a focus for institutional managers, I think BTC’s recent surge has laid the groundwork for huge outperformance by it as a go-to asset for protection.

[MacroScope @MacroScope17]

An Important effect of BTC’s recent surge is the reaffirming of it in institutional managers’ minds as debasement protection. This has always been a core investment thesis for BTC, but that perception had lapsed recently.

Perceptions like this are important on Wall Street, because once established during important market events, they can last for many years and even entire careers. As a sell-side market maker in the 1990s, I still vividly remember how the assets on our desk performed during various episodes including the Asian financial crisis -- and for years after, I would instinctively look at those assets during similar market environments.

If the debasement trade continues to become a focus for institutional managers, I think BTC’s recent surge has laid the groundwork for huge outperformance by it as a go-to asset for protection.

[MacroScope @MacroScope17]

@BitWhitman Longer post, maybe I'll do it.

[MacroScope @MacroScope17]

A month ago at gold $4000 (closed Friday at $4600) and BTC 64k. When sentiment meets news.

[MacroScope @MacroScope17]

Traders should be watching gold here. When an asset is in a long-term uptrend, and sentiment gets bombed-out on a big pullback but price quietly stops going down, that’s the time to start watching (similar to BTC right now).

Futures positioning in gold isn’t giving a strong indication here, but that’s been true for the past couple years because sovereign buying has made futures a less reliable indicator than in the past.

Everyone can see the bid under $4000, which is pretty much where you’d expect longer-term buyers (ie, sovereigns) to come alive. If I was looking to trade it, I’d probably start thinking about a small feeler position around here (and on a move under the June/July lows, I’d dispassionately step aside and wait for a reclaim of 4k). On a move to 4100-4200, I’d be thinking about adding to that long.

Important: When an asset is in a sharp correction after a blowoff top, the burden of proof is always on the asset to show strength. Always.

Not advice, just sharing my thinking.