Bitcoin: It's Alive! Chart Pack
The bitcoin price has woken up. Is it correlated more with bankruptcy proceedings and GBTC dynamics or the Fed reaching the end of its hiking cycle?
It’s alive! Taking Friday afternoon levels as the weekly close, we’re looking at bitcoin’s biggest week since a dead cat bounce during March of 2022. This does not mark the beginning of a bull market, but we are certainly witnessing strength for the first time in a long time. It has us cautiously optimistic, especially given news surrounding FTX, Genesis, and GBTC has yielded higher, not lower, prices.
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Bitcoin is finally resuming some news flow. FTX attorneys have recovered up to $5 billion. A GBTC redemption movement is receiving momentum from stakeholders.
Bitcoin’s price has responded positively this week. It flirts with $20,000 as of this writing and is up about 20% year to date.
Zooming out, bitcoin is reclaiming lost territory but remains shy of the true breakout. Those levels are discussed.
Bad news is becoming less bad: bullish
Markets are hilarious creatures. Growing up, I never understood how terrible earnings releases could result in positive stock performance, even on a relative basis. But I learned the lesson quickly: so many expectations are baked into the price at any time, that a shift in expectations is all you need.
The expectation of the FTX fallout was that the SBF crew had potentially gambled away and/or stolen up to $10 billion. We have now learned that up to $5 billion in liquid instruments has been recovered, making a terrible situation a little less terrible. The implications for counterparties throughout the system might alleviate, at the margin, some of the pressure on bankruptcy proceedings across troubled entities, including Genesis.
Genesis is said to owe more than $3 billion to creditors. Its parent company, DCG, which also owns Grayscale, operator of behemoth closed-end fund GBTC (which I know some of you own and are patiently waiting for some resolution) is now the central focus of bitcoin paper claim risk and arguably more important that the unknowns of Binance.
Over the past couple of weeks, a group at the website RedeemGBTC.com has allegedly gathered a material amount of shares, enough for the market to price it in: