One thing I'd like to add as something to watch for is the flow of capital might not re-enter GBTC. But ETHE or the other trusts. The other Trusts have much less circulating supply, and creating premiums in those vehicles is less capital intensive than in GBTC. Something to consider. If we do, Grayscale Effect 2.0 - Altcoin version will need to be written up!
Ben someone shared this link on a private investor invite telegram of all places . This is a great read and a well thought out analysis . For what it’s worth we’re expecting bitcoin to go on next leg up and top out around 80k before a major correction . Then the liquidity swap into etherum and alts . Bitcoin. Recovers for an all time night into thanksgiving well over 100k
Thank you very much for your outstanding anaylsis. Could you share your thoughts a little more?
1. Given that GBTC currently trades at a negative premium (-15%), why would the "whales" sell GBTC shares and buy BTC instead of just holding GBTC shares? Such trade will realize significant loss compared to 2.5% yearly fee.
2. When FOMO returns to the market, why do you think GBTC will trade at a premium again? Is it because of "non-accredited or retail investors looking for a pure-play into BTC within the stock market"?
I wrote, "I encourage you to question me and force me to consider bearish alternatives." Espresso is a place of ideas and conversation. Nobody pays me to write anything. I spend my own time and resources to put this together. A lot goes into it.
Do I say I'll be right all the time, never. Do I boast when I'm right? I don't do that either. I talk about market structure. Not about exact entry points.
Earlier this week I gave readers a heads up an uber bearish whale was transacting on-chain... in that same article I mentioned the larger trading shops were attacking 3mo futures with a carry/delta neutral trade.
I understand you might be upset that Grayscale didn't send BTC to $100k the minute after I published this piece, but that's a multi-month effect on the market. Again, market structure... which evolves over time.
I'm more than happy to hear your take on the market and perhaps we can both learn something.
Yup, you read that correctly. It came in yesterday...
P.S. - Pablo hasn’t had the best timing lately. In fact he tends to show up just in time for the last push lower before we reverse."
That was Monday. Wed/Thurs we got another push lower. We track wallets like this all day long. This mega whale sells in situations like this all the time. Tends to happen prior to macro news events tbh. Anyways, if this is the last drop and forms a "V" reversal, then he's 3 for 3 in selling in this pattern.
Your article is amazingly in-depth. I'm fascinated by not only how you find all these information but also how you derived a story behind them and make sense. Is there an update for May where the market dumped 50% from ATH? Thanks. PS: would love to have Jarvis as well, sharing is caring.
Thanks for the article, I read it late of course. But all I can say is if I would have read it even in April only base on so much retail money and leverage and such a less BTC dominance I would not see BTC pumping, though I would not have expected a 50% dump. I think the whole June we would be sideways or even drop to 25K, until I see the BTC dominance rise I am on sidelines.
The Grayscale Effect is dead according to Ben - "If we see outsized GBTC discounts and / or lower prices for bitcoin in late May, then it’s likely over for the Grayscale Effect. But if price starts to rip in the coming weeks, saddle up."
Really enjoyed this post. Curious about your thoughts on a few things though:
1. The lifecycle of a grayscale product was tweeted by Barry Silbert. I don't know enough about TradeFi and ETFs to understand whether this changes the Grayscale Effect at all? Will the mechanics of how it operates stay the same? https://twitter.com/BarrySilbert/status/1379050017021956097?s=20
2. The financial landscape of Bitcoin is becoming more complex as futures and options have more bearing on price. Even if Grayscale unlockings stimulate the spot market, can we expect to see the same level of price appreciation seen in previous unlockings? Or could we see a deeper game being played with derivatives that will reduce the impact of the spot buying on price? If Grayscale investors are price agnostic and the premium returns, then it doesn't matter to them.
3. If price does rip for BTC, ETH is going to have to appreciate pretty hard as well to continue the trend in ETH / BTC and bring about alt season. Do you think these two things are mutually exclusive or both could happen? I.E. BTC rip throughout May / June AND Alt Season? Or does the Grayscale Effect delay Alt Season?
1. ETF would operate a lot differently than a trust. Basically what makes the Trust have an effect on spot prices is bc of the mechanics. An ETF would be similar to spot purchases, just no self custody + small fee.
2. I imagine a good futures carry trade opening up in June. But yes, more comples game.
3. I think it can happen in tandem. BTC doing a 2-3x from here while ETH does a 4x-5x seems likely... and alts doing 7-10x.
That's a far point... substack (and our previous mailchimp days) let's me see WHEN a user signed up. I think it'd be fun to use that list in some capacity. Perhaps send out RSVPs to users starting with the most OG first?
One thing I'd like to add as something to watch for is the flow of capital might not re-enter GBTC. But ETHE or the other trusts. The other Trusts have much less circulating supply, and creating premiums in those vehicles is less capital intensive than in GBTC. Something to consider. If we do, Grayscale Effect 2.0 - Altcoin version will need to be written up!
Ben someone shared this link on a private investor invite telegram of all places . This is a great read and a well thought out analysis . For what it’s worth we’re expecting bitcoin to go on next leg up and top out around 80k before a major correction . Then the liquidity swap into etherum and alts . Bitcoin. Recovers for an all time night into thanksgiving well over 100k
boy, how wrong you were
Thank you, Ben Lilly. I am learning so much. I really appreciate it🥂
thank you so much for your work，Sincerely
Thank you very much for your outstanding anaylsis. Could you share your thoughts a little more?
1. Given that GBTC currently trades at a negative premium (-15%), why would the "whales" sell GBTC shares and buy BTC instead of just holding GBTC shares? Such trade will realize significant loss compared to 2.5% yearly fee.
2. When FOMO returns to the market, why do you think GBTC will trade at a premium again? Is it because of "non-accredited or retail investors looking for a pure-play into BTC within the stock market"?
I think your analysis is trash to be honest. You've been wrong for several weeks. Are you paid to post such fairy tale predictions?
I wrote, "I encourage you to question me and force me to consider bearish alternatives." Espresso is a place of ideas and conversation. Nobody pays me to write anything. I spend my own time and resources to put this together. A lot goes into it.
Do I say I'll be right all the time, never. Do I boast when I'm right? I don't do that either. I talk about market structure. Not about exact entry points.
Earlier this week I gave readers a heads up an uber bearish whale was transacting on-chain... in that same article I mentioned the larger trading shops were attacking 3mo futures with a carry/delta neutral trade.
I understand you might be upset that Grayscale didn't send BTC to $100k the minute after I published this piece, but that's a multi-month effect on the market. Again, market structure... which evolves over time.
I'm more than happy to hear your take on the market and perhaps we can both learn something.
Why would GrayScale investors (BlockFi and other DCG owned companies or affiliates) continue to buy spot BTC when the bull cycle has ended?
Can you elaborate on why you think the bull cycle has ended.
Can you elaborate on why you think we're in the bull cycle? Do you have an article about this?
https://jarvislabs.substack.com/p/a-higher-trajectory
^ wrote this last week
as for as analysis, here was Monday
"In the meantime, as we look forward…
Pablo is back...
Yup, you read that correctly. It came in yesterday...
P.S. - Pablo hasn’t had the best timing lately. In fact he tends to show up just in time for the last push lower before we reverse."
That was Monday. Wed/Thurs we got another push lower. We track wallets like this all day long. This mega whale sells in situations like this all the time. Tends to happen prior to macro news events tbh. Anyways, if this is the last drop and forms a "V" reversal, then he's 3 for 3 in selling in this pattern.
Article: https://jarvislabs.substack.com/p/hes-back
Other bullish stuff: https://jarvislabs.substack.com/p/the-liquidity-crisis-part-two-eth
Thank you - I will take a read. Who is this mega whale? CZ? Pablo?
Your article is amazingly in-depth. I'm fascinated by not only how you find all these information but also how you derived a story behind them and make sense. Is there an update for May where the market dumped 50% from ATH? Thanks. PS: would love to have Jarvis as well, sharing is caring.
Thanks for the article, I read it late of course. But all I can say is if I would have read it even in April only base on so much retail money and leverage and such a less BTC dominance I would not see BTC pumping, though I would not have expected a 50% dump. I think the whole June we would be sideways or even drop to 25K, until I see the BTC dominance rise I am on sidelines.
PS: I will share with friends.
The Grayscale Effect is dead according to Ben - "If we see outsized GBTC discounts and / or lower prices for bitcoin in late May, then it’s likely over for the Grayscale Effect. But if price starts to rip in the coming weeks, saddle up."
Love to hear your thought on Bitwise Fund xD
Really enjoyed this post. Curious about your thoughts on a few things though:
1. The lifecycle of a grayscale product was tweeted by Barry Silbert. I don't know enough about TradeFi and ETFs to understand whether this changes the Grayscale Effect at all? Will the mechanics of how it operates stay the same? https://twitter.com/BarrySilbert/status/1379050017021956097?s=20
2. The financial landscape of Bitcoin is becoming more complex as futures and options have more bearing on price. Even if Grayscale unlockings stimulate the spot market, can we expect to see the same level of price appreciation seen in previous unlockings? Or could we see a deeper game being played with derivatives that will reduce the impact of the spot buying on price? If Grayscale investors are price agnostic and the premium returns, then it doesn't matter to them.
3. If price does rip for BTC, ETH is going to have to appreciate pretty hard as well to continue the trend in ETH / BTC and bring about alt season. Do you think these two things are mutually exclusive or both could happen? I.E. BTC rip throughout May / June AND Alt Season? Or does the Grayscale Effect delay Alt Season?
1. ETF would operate a lot differently than a trust. Basically what makes the Trust have an effect on spot prices is bc of the mechanics. An ETF would be similar to spot purchases, just no self custody + small fee.
2. I imagine a good futures carry trade opening up in June. But yes, more comples game.
3. I think it can happen in tandem. BTC doing a 2-3x from here while ETH does a 4x-5x seems likely... and alts doing 7-10x.
You just killed my motivation to share with that last line 🥺
That's a far point... substack (and our previous mailchimp days) let's me see WHEN a user signed up. I think it'd be fun to use that list in some capacity. Perhaps send out RSVPs to users starting with the most OG first?
The problem is I have no clue where I stand in that list 🙃 I look forward to continue reading, you're putting out some seriously good content