GSG Market Update – July 22, 2019 INTERNAL USE ONLY (copy 01)

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GSG Market Update

 

MarketWatch

July 22, 2019
 
Name Current Price 24h % 30d Vol 90d Vol 21d EMA 50d EMA
Bitcoin  $10,499.39 -1.52% 130.25% 97.16% $10,778.321 $10,089.450
Ethereum  $221.96 -2.30% 117.99% 100.02% $252.540 $257.716
XRP  $0.325 -1.61% 93.92% 98.37% $0.351 $0.373
Litecoin  $96.49 -3.16% 121.87% 105.64% $105.338 $109.915
Bitcoin Cash $315.72 -3.24% 132.45% 112.24% $350.490 $373.425
Binance Coin $31.49 2.42% 98.90% 97.49% $30.699 $31.028
EOS  $4.24 -0.83% 123.72% 113.75% $4.885 $5.542
Bitcoin SV $169.000 -5.61% 154.18% 194.19% $166.573 $170.027
TRON  $0.029 -2.84% 142.90% 117.32% $0.029 $0.030
Stellar  $0.090 -2.25% 109.84% 102.15% $0.096 $0.106
 

News

  • Fidelity Digital Assets has officially applied to the New York Department of Financial Services for a Trust license. If its application is successful, Fidelity Digital Assets would be cleared to add New York to the handful of states in which it currently operates its custody business for digital assets.
  • Large withdrawals have been seen at BitMEX following the news that Commodity Futures and Trading Commission is investigating BitMEX due to suspicion of illegally offering trading to citizens in the U.S. Token Analyst reports that BitMEX saw $85 million in withdrawals compared to $54 million withdrawn from Binance and $52 million withdrawn from Bitstamp.
  • Fundstrat Global Advisors released report on Bakkt Institutional Digital Asset Summit with takeaway that the full launch of the Bakkt platform is expected is to take place later this quarter. Also begins user acceptance testing for its Bitcoin futures contracts today.
  • According to statements by Shri Anurag Singh Thakur, Minister of State in the Ministry of Finance, the government of India hasn't banned the use of crypto, with regulations still in the works.
  • According to new research from CB Insights, blockchain venture capital is on track for a 60% decline when compared to 2018 figures. Report link
  • Since the project launched a little over six months ago, Wrapped Bitcoin has roughly $5.9 million or 558 BTC locked into the system. At the rate WBTC’s token contract is climbing, the project is close to surpassing the Lightning Network’s capacity in the near future.

Upcoming Events

  • Jul 26 - CME Bitcoin Futures Jul 2019 contract (BTCN19) last trade date; settlement July 29
  • Jul 29 - Tether Case "Order to Show Cause" deadline for NY AG's office
  • Aug 6 - Litecoin Block Reward Halving (Coin reward decreases from 25 to 12.5 coins)
  • Aug 14 - SEC decision on Bitwise ETF
  • Aug 20 - Blockchain Summit Singapore 2019 (forthcoming)
  • Aug 30 - CME Bitcoin Futures Aug 2019 contract (BTCQ19) last trade date; settlement Sept 3
  • Sept 17 - Ethereum Classic Atlantis hard fork
  • Sept 27 - CME Bitcoin Futures Sep 2019 contract (BTCU19) last trade date; settlement Sept 30
  • Jan 3, 2020 - Ethereum 2.0 Launch (Phase Zero)
  • Nov 2020 - ZCash Halvening / Founders’ Reward set to expire

Charts

BTC Longs-Shorts


ETH Longs-Shorts


Market Cap Return


Sector Return

Twitter Daily

Respectfully disagree with both @iam_preethi and @AriDavidPaul In reality, mining operation is VERY MOBILE. Bitmain even developed a mobile mining rig container. When price dropped significantly, machines will be transported/sold to whoever has cheaper electricity to mine twitter.com/iam_preethi/st…


This is also a HUGE underestimated factor for mining economic, it’s also the reason why China, despite not producing the cheapest electricity, still the best place to mine. The logistic cost there is insanely cheap with highly developed transportation infrastructure

hence mining rigs are fluidly transported between different farms with various electricity cost(hydro, coal, wind, solar etc), if it’s really that bad, rigs will be sent to those one belt one road states like Kazakhstan where electricity can as cheap as 1 cents

Also it’s not just a practice during crisis, but also a VERY COMMON SEASONAL PRACTICE In raining season hydro is the cheapest so rigs are shipped to farms near dam, and once pass Oct, rigs will be shipped to coal farm. The distance is about 2000 miles between those farms on avg

I don’t think Bitmain’s container sold really well, it fits 300ish S9 and cost ~$2500. This thing has little tech barrier so quickly there are many other similar products in the market with much cheaper price


 “Listing agents” are back .. and they never learned the new alts paradigm obviously.. Most alts will die from liquidity crisis this time, as the current game of IEO is selective joint-promotion by the exchanges for their value users instead of a paid-to-list bribery

Richard Raizes @richardraizes

Sadly they are back. Prime example is @Liquid_Global helping presale investors dump illiquid TON tokens on retail investors for 3x+ profit


 

1/ Hypothesis: currently available #cryptoassets can’t help but be sub-optimally distributed given only half of the global population is online. en.wikipedia.org/wiki/Global_In…

2/
Put another way, the fact that ~80% of the “developed world” is online, while only ~40% of the “developing world” is, presents a huge problem for #crypto if our intent is to lessen inequality.

3/ Not to be dour, but it's been a daunting recent reflection of mine, and points to how early we potentially are in the crypto movement.

4/ But to throw a twist in, it's only early if our intent *truly* is to lessen inequality, "bank the unbanked," etc. If instead, deep down, it's for all the "developed world insiders" to get rich, then no, it's not too early. Crypto is already doing a good job at that.

5/ Which leaves me to ask myself, and to ask you, if #crypto's "philanthropic rallying cries" are just an excellent tactic for misrecognition. (per Bourdieu's conception of misrecognition: powercube.net/other-forms-of…)

6/ Because if we're being sincere with the philanthropic rallying cries, then a larger focus needs to be building out online access, as that's necessary to physically carry the "bits of capital" to everyone.

7/ A last note: imo #crypto’s not as much about banking the unbanked as it’s about capitalizing the uncapitalized - but I’ll leave that for another day.


Max Keiser, tweet poet.@maxkeiser

Iran, the accidental #Bitcoin powerhouse. They may wake up one day and discover (due to 1/2 cent per kilowatt power), they got A LOT of BTC and decide simply add it to strategic reserves. This is much more powerful, as a negotiating tool, than nuclear weapons by far.


 

This is getting quite serious. Let's summarize: - Both BitMEX and Bitfinex are now investigated for servicing U.S. customers - Bittrex and Poloniex started to geo-block tokens from the U.S. - Binance pulled crypto-to-crypto trading out of the U.S. completely

Udi Wertheimer @udiWertheimer

A lot more happened. Bittrex and Polo require KYC from *everyone* (they didn’t in the past). Because that’s the only way to be sure they’re following laws for American customers. That’s around when volume died

Binance requires KYC for margin trading. Will it do the same for futures? Probably BitMEX and Bitfinex claim to block Americans, but it’s by IP so pretty useless. US regulators probably won’t rest until they can force them to do full KYC for everyone

 

Dalio's "Paradigm Shifts" piece presents the most bullish thesis for both gold and bitcoin I recall reading. Read it, and arrive to your own conclusions. How ironic that @RayDalio does not understand bitcoin (to say he's not a fan is an understatement). linkedin.com/pulse/paradigm…

Excerpts: "Every major asset class had great and terrible decades, so much so that any investor who had most of their wealth concentrated in any one investment would have lost almost all of it at one time or another."

"Central banks have been lowering interest rates and doing quantitative easing... That form of easing is approaching its limits because interest rates can’t be lowered much more and quantitative easing is having diminishing effects on the economy."

"As these forms of easing (i.e., interest rate cuts and QE) cease to work well ... the other forms of easing (most obviously, currency depreciations and fiscal deficits that are monetized) will become increasingly likely."

"Expected returns of non-cash assets are being driven down toward the cash return, so there is less incentive to buy them, so it will become more difficult to push prices up...that will lead investors to prefer alternative forms of money (eg. gold) or other storeholds of wealth."

His conclusion: "I believe that it would be both risk-reducing and return-enhancing to consider adding gold to one’s portfolio."

Dalio is not a fan of bitcoin though. To him, bitcoin is: - not an effective medium of exchange - not a storehold of wealth because of its volatility - a highly speculative vehicle - a speculative bubble - has no intrinsic value youtube.com/watch?v=UyVIuN…

Ironic he does not recognize bitcoin itself as another paradigm shift. Bitcoin does not need to be an effective medium of exchange to be used as digital gold. Its volatility is temporary, and will progressively diminish as the market matures. Just give it time.

Joe McCann@joemccann

Vol has fallen off a cliff. Down 33% today alone on Bitmex

MACD Crossover soon come. Then...fireworks.


 

Hey @MakerDAO folks, what are your thoughts on this? 22% is approaching usury

Spencer Applebaum @SpencerApples

@MakerDAO have you considered $0.98 Dai means investors are pricing risk of Maker contracts breaking before MCD global settlement + opportunity cost of arb @ 2% (which is fair). The notion Dai should trade at exactly $1 (w/o DSR), which is driving these fee hikes, seems misguided

Eric Lamison-White  @1blockologist
Replying to @KyleSamani @MakerDAO

Finally someone says it: the Maker community praises their interest rate stability fee adjustments, but its almost like they are just amused that their proposal and voting protocol worked at all, completely absent of critique of the proposal or outcome

Dai isn't a stablecoin, it's just an abstraction for leverage and debt. Right now Maker is used as a weirder version of @compoundfinance with fee adjustments to keep the price of Dai ~$1 so people don't think they pivoted to a leverage DeFi dapp....but the writing's on the wall.

Dai is a permissionless stablecoin. What keeps it stable is the interest rate. Right now that needs to be very high due to ETH demand until dai savings rate gets delivered and until more people want to hold / lock Dai for other purposes (ie: Augur bets).

Until what festure gets delivered? Whats changing?

People will be able to lock Dai directly in a MKR contract and be paid interest for holding it. Right now you can get paid interest on Dai by lending it to other DeFi businesses, but they lend that Dai back out. Locking up Dai will reduce available supply increasing Dai price.

unpopular opinion: Dai Savings Rate is massively overrated with pseudo-DSRs proxies like @compoundfinance @dydx @getnuo @CelsiusNetwork @NexoFinance etc existing compared to the above alternatives to earn interests, will the "official" DSR be - "easier"? - "safer"? you tell me.

imo the general acceptance of fiatcoins into defi platforms like USDC TUSD PAX will slowly kill the value prop of using DAI as its main benefit of being censorship resistant is a property that only few value and are willing to pay premium for it.

and imo the main reason for the upcoming "flippening" from DAI to fiatcoins on defi platforms will simply be because of the lack of capability of DAI to scale up to meet demand. DAI is driving up defi lending rates now with its SF. i think this will change soon.

once fiatcoins become bigger than DAI within defi, you will start to see that MKR SF will then be at mercy of the prevailing USD market borrow/lend rates, and people will simply switch to fiatcoins because they are SIGNIFICANTLY cheaper.

anecdotally, i know plenty of finance bros willing to dump in 6-7 figs into lending USDC / GUSD for "only" 8-10%. none of them care or want to touch DAI. in fact, to them, DAI is considered "junk" since it is not directly redeemable for $1, while USDC and GUSD are.

if MKR could only set SF fees to say 12% because of the ceiling set by finance bros on the fiatcoin alternatives, - what would the supply of DAI be? - what would the price of DAI against the peg looks like? i'd imagine much lower supply and a looser DAI price range.
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This update is provided for information purposes only and does not bind GSG Asset Management or any of its affiliates in any way. It is not, and is not intended to be, a/an: (1) “research report”, “investment research” or “independent research” as may be defined in applicable laws and regulations worldwide; (2) offer to sell, a solicitation of an offer to buy, or a recommendation for any digital asset by GSG Asset Management or any third party; or (3) official confirmation or official valuation of any transaction or asset mentioned herein. To the extent that any of the content published in this update may be deemed to be investment advice or recommendation in connection with a particular digital asset, such information is impersonal and not tailored to the investment needs of any specific person. Any pricing information is indicative only, and does not reflect a level where GSG Asset Management is prepared to execute a trade. You understand that an investment in any digital asset is subject to a number of risks, and that discussions of any digital assets in this update will not contain an exhaustive list or description of the relevant risk factors. GSG Asset Management is not an advisor, and nothing in this update should be construed as investment, tax, legal, accounting, regulatory or other advice, or as creating a fiduciary relationship. You alone are solely responsible for determining whether any investment, security or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation. All market prices, data, and other information (including that which may be derived from third party sources believed to be reliable) are not warranted as to completeness or accuracy, and are subject to change without notice. All content in the update is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. GSG Asset Management disclaims any responsibility or liability to the fullest extent permitted by applicable law, whether in contract, tort (without limitation, negligence), equity, or otherwise, for any loss or damage arising from any reliance on or use of this update in any way.






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