2021W5 - WTF has happened in bitcoin this week?
Bitcoin is being recognized.
TLDR: Companies buying bitcoin for their balance sheets is becoming normalized.
Here we go sliding through the 5th week of What the F%&K has happened in Bitcoin? Some of the main worries we often hear is: “This is just another bubble”, “This is another blow off top”, “You should sell, have you taken some profit?”.
These are just some of the common sentences bitcoiners often hear from their ‘no-coiner’ friends and family. The question is, Should you really sell? Is bitcoin looking healthy?
The truth is that the Bitcoin space seems brighter and brighter every single day. Last week’s edition we talked about validation, now let us focus on recognition.
Bitcoin is being recognized by institutional investors. Every week we hear a new public person or company buying or setting up part of their reserves into it, well this week is similar but different. Michael Saylor, CEO of MicroStrategy, ran a conference where executives came and learn why and how to buy bitcoin for their balance sheet.
We also have seen entrepreneurs and celebrities getting together in Clubhouse, a video chat room, to talk and learn about different topics, bitcoin being one of them. There was a session where Elon Musk participated and let the community know that he is a bitcoin supporter.
And this is how the week started:
1. Mark Cuban has changed his opinion on bitcoin, shifting from “Bitcoin is more a religion than a solution” or “I would rather have bananas over Bitcoin, because a banana has more utility.”, to recognizing that it is a store of value. Marc published a piece where hi basically defines what a store of value is. And explains how Bitcoin has become a store of value replacing gold’s role the new generations.
“What is a store of value? It is something that some number of people assign value to and are willing to pay for and then hold on to, hoping that circumstances increase the value of that item. One of the most historic and visible stores of value is Gold.” – Marc Cuban.
2. Just a day before MicroStrategy’s conference “Bitcoin for corporations” began, Michael Saylor announced that MicroStrategy had just purchased 295 bitcoins for $10.0 million, at an average price of ~33,808, and now having a total of 71,079 bitcoins acquired at an average price of $16,109 per bitcoin.
3. MicroStrategy opened the conference, hosting more than a 1400 executives from different companies. The main being to share a “playbook” with other companies in how to integrate bitcoin into their strategies, while considering all the legal requirements. This playbook is said to be a 12 week process.
One of the most popular interviews was Michael’s with Ross Stevens, where Ross tells great analogies of why Bitcoin’s digital scarcity is the great innovation, as its price surged, one cannot simply mine more of it due to its monetary policy, unlike gold’s supply, which could easily increase if price were to double. Ross also explained how open source technology is being leveraged by companies such as Strike and NYDIG, to make settlements in any currency between currencies, and why people shouldn’t be afraid of “bitcoin being banned” on a specific country, by explaining that even gold was banned at some point, and this didn’t stop it from increasing in price after a massive devaluation of the national currencies through inflation.
(This is a highly recommended interview)
4. Guggenheims, a global investment firm with $ 270B. in assets under management (AUM) , proposed SEC filling to buy $500 million via GBTC (Grayscale). Right after the publication, Scott Minner, CIO of the company, discussed with CNN’s Julia Chatterley bitcoins long-term price potential, stating that according to their fundamental research, he believes that bitcoin price could eventually rise up to $600,000 per bitcoin.
5. Miami’s mayor, Francis Suarez, has continued to strive for innovation, inclusion and bitcoin adoption. In an interview with forbes, he admits he has been fascinated with the idea of bitcoin, his three tangible paths the city of Miami is taking to expand its bitcoin-friendly nature:
6. Visa announced they are working with Anchorage, a digital asset platform for institutions, to allow customers at traditional banks to buy and sell bitcoin.
7. Glassnode reported at the beginning of the week, a bullish metric. Exchanges have the lowest supply of bitcoins in the last 2.5 years, and it appears to decrease by the day.
8. Bitcoin’s distribution keeps spreading. In the last years “The Humpbacks” have been decreasing, meaning big players with over 5000 bitcoins have been taking profits, while many new players are entering the game, “Shrimps” and “Crabs”, who one might say are individuals, and even institutions, which might be the new “Whales” being created.
9. Big movements of bitcoins outflowing exchanges continue. Willy shows in these charts a timestamp of Michael Saylor’s conference, where we previously said more than 1400 executives attended. If we try to speculate, could this mean that the CEOs and executives of the different companies are trying to front run their own company’s integration of bitcoin?
As a summary note…
I recently saw the news from Myanmar, the country is undergoing a coup, and residents from Yangon were lining up to an attempt of retrieving cash, since Banks shut down all financial services. This is exactly why bitcoin is relevant, and bitcoin is hope.
The world is opening to the idea of having a digital scarce bearer asset. An asset which stores value and does not depend on a single country’s monetary or fiscal policy. Its digital nature gives bitcoin a property which we were losing by the push of getting rid of cash: censorship resistance, and an additional one, which could be more relevant depending on the country you live in, hard to confiscate.
Basically, we have a new kind of money, which is hard to seize, easy to transport and transact. Bitcoin is hope in the digital world we live in.
As an additional note: This is our chance to front-run the companies who are planning into integrating bitcoin to their balance sheet. It is not a simple process for a company, but it is as an individual.
Stay humble & stack sats.
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