TBL Weekly #3

Our weekly recap of The Bitcoin Layer posts and videos.

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Jul 16, 2022

Kick off your Saturday morning with a recap of all the content you may have missed this week at The Bitcoin Layer. Grab a coffee, and let’s dig in.

Monday

Nik joined MacKenzie Sigalos in his first CNBC appearance to discuss the contagion from bitcoin’s bear market:

Tuesday

Nik breaks down bitcoin’s recent 75% crash from its all-time-high, explaining why is this normal, and why you shouldn’t worry. This one is packed with our Fair Valuation Framework and some bitcoin history:

Wednesday

Bitcoin miners are getting squeezed, with plummeting revenues forcing unprofitable machines off the network.

We cover the periodic cleansing of the bitcoin mining ecosystem, discuss the forced selling of bitcoin from miners’ reserves in order to keep the lights on, and why final miner capitulation marks local bottoms and will signal a trend reversal for bitcoin:

The Bitcoin Layer

Getting bullish on miner capitulation

Dear readers, We’ve covered forced selling among many leveraged players in the broader bitcoin ecosystem, but a dynamic you may be less familiar with is the capitulation of publicly traded bitcoin miners. These companies are unplugging inefficient machines, selling bitcoin from their reserves in order to fund operations, and sometimes selling simply to meet margin requirements or make interest payments on loans…

2 years ago · 8 likes · Nik Bhatia and Joe Consorti

Thursday

Nik discusses why GDP is not useful in asset allocation and why you need leading economic indicators instead to help identify shifts in the business cycle:

Friday

The rates market is pricing in easier monetary policy by next year. This is already starting to support risk assets, including stocks and bitcoin:

The Bitcoin Layer

After 8 months of bleed, risk-off is ending

Dear readers, Global asset prices move through different regimes. Correlations come and go, as do risk cycles. For the past eight months, rising yields and declining marginal liquidity have decimated bitcoin and equity prices. I now believe a shift is occurring in interest rates that will lead to relief for both risk assets…

2 years ago · 11 likes · Nik Bhatia

Market Analysis

And finally, here is our Market Analysis for the week, including all relevant price action, rolling correlations, proprietary metrics, and value ratios. This week, we introduce our correlation monitor, showing readers bitcoin’s correlation with stocks (very high), the dollar, and ETH/BTC (also very high). More on this in the coming weeks. Bitcoin remains right around its fair value:

Metrics are as of Friday, July 15, 2022.

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