Crypto Catalysts: Unveiling the Driving Forces Behind the Next Bull Run
Exploring the Impact of Bitcoin Spot ETF, Halving, and "Printer go brrr" on Cryptocurrency Markets
TL;DR:
Three catalysts will drive the next crypto bull run: Bitcoin Spot ETF approval, Bitcoin halving, and printer go brr.
Approval of Bitcoin Spot ETF applications will attract institutional investors and create FOMO-driven demand.
The Bitcoin halving acts as a self-fulfilling prophecy, with the belief that it leads to a bull run.
Expect a potential recession in 1H 2024, leading to Fed cutting rates and printer go brr - the ultimate buy signal.
💥𝗖𝗿𝘆𝗽𝘁𝗼 𝗖𝗮𝘁𝗮𝗹𝘆𝘀𝘁𝘀
I believe three main catalysts will drive the next crypto bull run.
➡ Bitcoin Spot ETF
There are currently over ten pending applications for $BTC Spot ETF approval. The SEC has until January 2024 to respond to ARK Invest and 21 Shares, and they will continue to receive a barrage of applications until they are approved. This is a catalyst for two reasons. First, it provides a convenient avenue for institutional investors, such as retirement funds, to invest on behalf of their clients. Second, it creates demand-side buy pressure, which leads to people FOMO'ing in as "number go up".
In any case, whenever I think about this, I can't help but think about what happened to the price of gold when the Spot GOLD ETF got approved back in 2005.
➡ Bitcoin Halving
In my view, the BTC halving can be seen as a self-fulfilling prophecy. When market participants believe that a bull run occurs after a BTC halving, as it has in the three previous cycles, it becomes a catalyst - even if it wasn't originally a direct cause.
➡ Printer go brrr
In the first half of 2024, my base case is that we'll finally see a “recession” as newly defined by the Fed. Inflation will decline, unemployment will rise and ultimately, the economy will slow. The Fed will end up cutting rates (like 2019 and 2020) and start “printer go brr” to refinance existing debt. This is the ultimate buy signal.
⚠️ DISCLAIMER ⚠️
The content provided by PROJECT 10X PTY LTD (Filip Brnadic) is for educational purposes only and is not financial or investment advice. PROJECT 10X PTY LTD is not a licensed financial adviser under Australian law.
Investing involves risk, including the potential loss of all funds. Seek independent advice before making any financial decisions.
eToro 🐂
I've taken into account the factors I mentioned earlier and tried to anticipate what the macro landscape will look like in the next 6 to 12 months. But I have to admit; sometimes it feels a bit nerve-wracking because, unlike me, a lot of institutional investors are sidelined and waiting for something to "break”.
I've decided to heed the advice of one of my favourite macro thinkers, Raoul Pal, who once said, "as a good investor, we should be investing based on what the environment will look like six to twelve months out" - so that's exactly what I've done.
I plan to keep about 12% of the portfolio in cash as dry powder, patiently waiting for that ultimate buy signal I mentioned earlier. Considering the concentration of my current portfolio, I'll be looking at broad indices like $SPX500 and $NSDQ100 . Both of these have low correlation coefficients with my current holdings, sitting at 0.48 and 0.49, respectively.
Enzyme 💪
I’m slowly consolidating the portfolio into four main holdings: $ETH, $SOL, $MATIC, $LIDO. I believe these projects have strong narratives and will perform well in the next bull run while still being reasonably conservative from a risk-curve perspective.. compared to say, buying [INSERT LATEST DOG COIN HERE].
They will “come alive” at different stages of the bull run, so I’m prepared to take profit at the levels I’ve marked out, but that’s a post for another day.
I’ve closed positions in $CRV and $FTM.
At one point, $FTM had a beautiful “Andre Cronje” is coming back narrative and that was a major catalyst for the community, but these days the only news coming out is about another hack on the network.
$CRV on the other hand doesn’t have a community pushing a narrative, and as you know - without a narrative in the crypto space, you may as well be holding rocks.
That's all for now.
✌️
Filip