THE KEY POINTS

• Bitcoin trades at $63,181, down 49% from its October 2025 high of $124,715.

• Price just touched its 200-week moving average for only the fourth time ever. Each prior instance was higher a year later, median gain 116%.

• The average buyer from the last two years is underwater. The one-to-two-year cohort sits 27% below cost, while every holder older than two years is still in profit and not selling.

• Long-term holders control 74.5% of all Bitcoin, an all-time high, and added 443,000 coins over six months as price fell in half.

• Old coins are dormant and forced selling has faded. The capitulation that drove the June low is largely behind us.

• Realized Market Cap has fallen $62 billion, the second largest drop ever, yet stored capital is down only 5.5%. This holder base is far stickier than past bears.

• Buying Bitcoin during deep drawdowns has produced a positive twelve-month return between 83% and 93% of the time.

• Missing the ten best trading days in a year has historically erased the entire year’s gain. Consistent dollar cost averaging is how you stay present for them.

Bitcoin Sits On Its 200-Week Moving Average

The 200-week moving average is one of the most reliable long-term value floors in Bitcoin’s history. Price closed below it in early June for only the fourth time ever, bottomed at $58,544, and has since reclaimed the line. It now sits at $62,754 with spot at $63,181, so Bitcoin is trading right on top of it. In the three prior instances, the twelve-month forward return was positive every time, with a median gain of 116%.

Everyone Who Bought In The Last Two Years Is Underwater

This splits the supply into cohorts by how long each coin has been held and shows the average price each group paid. Every buyer from the last two years is now underwater, with the six-month to one-year cohort down the most at 38%. Every cohort older than two years remains in profit, some of them deeply so. That divide explains exactly who has been selling and who has been sitting still.

Price Below The 1-2 Year Cost Basis Only Happens At Bottoms

Here is the cost basis of the one-to-two-year cohort plotted against price, with the shaded regions marking every stretch price traded below it. This has only occurred during major bear market lows: 2015, 2018 to 2019, the 2022 to 2023 bottom, and now. Today spot is 27% below this cohort’s $86,908 basis, the fourth-deepest reading Bitcoin has ever recorded. The only deeper instances were the FTX collapse, the 2015 bottom, and the 2018 bottom.

Long-Term Holders Are Buying The Weakness

Long-term holders are wallets that have held for at least 155 days, the group that historically buys weakness and sells strength. Their supply just hit an all-time high of 14.94 million coins, or 74.5% of everything in circulation. Over the last six months, while price fell nearly in half, this group added 443,000 coins. The panic selling from newer buyers is being absorbed by hands that have no intention of letting go.

More Than 60% Of Supply Has Not Moved In A Year

HODL waves divide the entire supply by how long since each coin last moved. The green bands represent coins held longer than a year, and they now account for 60.9% of supply, up from 59.1% six months ago. When these older bands expand during a drawdown, the selling pressure is coming almost entirely from recent buyers. The deep base of the market is not participating in the sell-off.

The Old Coins Are Dormant

Coin Days Destroyed measures the economic weight of coins moving on-chain, registering high when old coins move and low when young coins move. Adjusted for supply, the metric sits at its 11th percentile since 2015, so the coins changing hands right now are overwhelmingly young. The long-term holders sitting on large unrealized gains have stayed still through the entire drawdown, which is the opposite of how tops form.

The Capitulation Has Already Happened

This tracks the amount of long-term holder supply sitting at a loss alongside the volume those holders sent to exchanges to sell. Loss-selling peaked in mid-June at 167,000 coins over a thirty-day window, precisely as price hit its low. It has since fallen to roughly 130,000 and keeps declining. The largest forced-selling event of this cycle is behind us and fading.

Capital Exiting, But The Base Is Sticky

Realized cap values every coin at the price it last moved, so it only falls when coins are sold below their acquisition price, and capital is leaving the network in the aggregate. That makes any decline a rare event confined to true bear markets. The current drawdown of 5.5% represents $62 billion in net capital lost, the second largest in dollar terms Bitcoin has ever seen. The percentage decline is far shallower than past bears of 14 to 24%, a sign this holder base is absorbing losses instead of fleeing.

What Has Happened After Buying That Condition

Taking every day in history when price traded below the one-to-two-year cohort’s cost basis, this shows what came next. Twelve months later the median return was 109% and the outcome was positive 97% of the time. At two and three years, every single instance was profitable, with median gains of 435% and 677%. Bitcoin is inside that exact condition today.

Miss The Best Days And You Miss The Year

This is the core case for staying invested rather than timing entries. In Bitcoin’s positive years, the ten best trading days delivered a median of 101% of the entire year’s gain. Strip out those ten days and five of Bitcoin’s ten winning years flip to losing years. A $10,000 buy and hold since 2015 grew to $1.97 million, yet missing just the ten best days cut that to $347,000.

Where You Buy Sets Your Cost Basis

This compares the average cost per coin under different dollar cost averaging rules since 2018, each buying $100 a day when its condition was met. Buying only during 30% or deeper drawdowns, the condition we are in today, produced the lowest average cost at $11,629. Chasing price near all-time highs produced the worst at $57,931. Buying weakness consistently beat buying strength by a wide margin.

The Deeper The Drawdown, The More Reliable The Return

This buckets every day from 2015 to 2025 by the market condition at purchase and shows the median twelve-month forward return. Buying during a 50% drawdown produced a positive result 93% of the time, against 75% for buying near the highs. The deeper the drawdown at purchase, the more dependable the outcome became. Bitcoin is 49% below its all-time high right now.

To Recap:

1. By multiple independent measures, price against the 200-week average, the cost basis of recent buyers, realized capital destruction, and holder behavior, this is one of the more compelling accumulation setups Bitcoin has ever offered.

2. None of these signals can call the exact low, and two of the past episodes ran for more than a year before turning. Anyone promising a precise bottom is guessing.

3. That uncertainty is the argument for dollar cost averaging rather than against it. Bitcoin’s largest single-day moves cluster inside drawdowns like this one, and missing them wrecks long-term returns. The dependable way to capture them is to keep buying through the discomfort, which means being in the market when it is cheap, as it is right now.

Surely this has been a bad time to be a Bitcoin miner… right?

Wrong.

Bitcoin Mining is not a short-term bet on BTC price action. That’s what options are for.

Bitcoin mining is a Tax-Efficiency and Dollar Cost Average strategy.

It’s purpose is to build a BTC position over a long-period of time in the most tax and capital efficient way possible.

In this newsletter we examine the past twelve months of a hypothetical mining operation:

• $300,000 per year earner living in NYC (32% Federal Tax Bracket)

• 10x Antminer S21 XP (2,700 TH) at ($7,020 per machine), hosted at $0.07/kWh, online July 6, 2025.

• Monthly power costs paid out of pocket (to resemble a “DCA” strategy).

• 0.4538 BTC accumulated in 12 months

• Effective acquisition price: $49,252 per BTC on power spend. Spot averaged $90,227.

• 74% more Bitcoin than a standard DCA spending the same amount per-month.

• $17,551 in federal tax savings

• Machines out-earned their power bill in all 12 months. The position funds itself if the miner ever wants it to.

The Strategy

Bitcoin mining is a dollar cost average program with two upgrades. The client deploys capital monthly, exactly like a DCA. The difference is what the dollars buy. A DCA buys coins at spot. A miner buys power, and the machines convert that power into coins at a steep discount to spot. And unlike exchange purchases, the capital is deductible: 100% bonus depreciation on the hardware under §168(k), electricity expensed as it’s paid.

This is a long-term treasury-building strategy. The price of Bitcoin along the way doesn’t change the plan. It only changes how cheaply the position gets built.

Steady Accumulation

Over the twelve months ending July 5, 2026, the fleet produced 0.4538 BTC. Monthly output stayed in a tight band around 0.037 BTC while price fell 42%, because production depends on hashrate share, not price. Revenue exceeded the power bill in every single month.

The Tax Advantage

Our model client is a single filer in New York earning $300,000 in W-2 income, running the operation as an active trade or business with material participation. Deductions totaled $92,551. That fully sheltered the mining income and left a $51,686 loss that offset salary.

New York decouples from federal bonus depreciation, so the state return depreciates the hardware over five years instead ($14,040 in year one, the rest carrying forward). The headline savings are federal. Mined coins also take a cost basis equal to their value when mined, so most of the eventual upside has a stepped-up starting point.

Same Dollars, More Bitcoin

Take the exact power dollars this client spent, $61.24 per day, and run them through a standard DCA instead. The DCA ends the year with 0.2601 BTC. The machines ended it with 0.4538 BTC. Same outflows, 74% more Bitcoin, plus hardware that’s still producing.

Mining turns a monthly power bill into a growing Bitcoin position and a smaller tax bill. You build a long-term treasury at a discount to spot while the tax code funds part of the entry, in bull markets and bear markets alike. See how the numbers work for your situation at blockwaresolutions.com/info.

Click here to read our free 2026 Q2 Market Update.

This Blockware Intelligence Report covers the key signals listed below:

Macro

• AI IPO wave. SpaceX listed at roughly $1.75 trillion, the largest debut on record. OpenAI (~$1T) and Anthropic (~$965B) are expected to follow. Combined, the three are worth about $3.7 trillion, ~13x more than every US company that went public in 2021 raised.

• Sector leadership. S&P 500 gains concentrated in AI-linked sectors: industrials, energy, and technology.

• Hyperscaler capex. Amazon, Microsoft, Alphabet, and Meta guided toward roughly $700 billion in 2026, up from about $410 billion in 2025.

• Manufacturing. ISM Manufacturing PMI reached 54.0 in May, a fifth straight month of expansion.

• Liquidity. M2 money supply is at a record level and expanding again.

• Gold. Rolled over after a two-year run, posting its worst quarter since 2013.

• June stall. Equity leaders flattened late in the quarter; the Nasdaq-100 consolidated and Nvidia sold off.

• Fed and inflation. The Fed held rates in June and markets price a pause. CPI is elevated on energy, which has since turned lower.

• Debt and yields. US federal interest expense is at a record above $1 trillion annually; US and Japanese 10-year yields are grinding higher.

Bitcoin On-Chain

• MVRV. About 1.13, in the 1.0 to 1.5 accumulation band.

• Long-term holders. Supply at a record near 14.8 million BTC; still accumulating.

• ETF flows. Record quarterly outflow of about 72,000 BTC, the cohort’s first major capitulation.

• Supply in profit. Fell below 50%, leaving the majority of coins underwater.

• Coin Days Destroyed. Subdued, in the lower fifth of its two-year range; old coins are not moving.

Strategy

• STRC. Broke its $100 par to about $75 before rebounding; it did not behave like a money-market instrument.

• Solvency. No default risk to MSTR; preferred dividends can be paid or deferred.

• BTC sales. The June 29 framework caps sales near $1.25 billion, a fraction of Bitcoin’s $20 to $30 billion daily volume.

• Dilution. The live risk is dilution. MSTR trades near 0.63x mNAV, below the value of its Bitcoin, so equity-funded buys now reduce Bitcoin-per-share.

Mining

• Hashrate. Rolled over roughly 16% from a late-2025 peak, from about 1,120 to 936 EH/s.

• Economics. Breakeven varies sharply by machine and power rate.

• Hardware. Efficiency has plateaued; no more efficient air-cooled ASIC has shipped since the S21 XP, roughly 20 months ago.

• Taxes. Mining hardware qualifies for 100% first-year bonus depreciation under Section 168(k).

Click here to read the report

It's a range, and where you land in that range comes down to two inputs: how efficient your machine is, and how cheap your power is.

Get both right and you're producing Bitcoin at a discount to the market price. Get both wrong and you're spending more on electricity than what your mined Bitcoin is worth.

Despite Bitcoin trading down ~50% from it’s all-time high, miners using the most-efficient machine on the market, the Antminer S21 XP, are still operating at a profit if their electricity rate is below $0.09/kWh.

• There is no universal mining cost. It’s a function of machine efficiency (J/Th) and electricity rate ($/kWh). Nothing else moves the needle as much.

• At today’s network size, the spread is enormous. A new S21 XP at 5 cent power mines a coin for about $33k. An older S19 XP at 9 cent power needs about $96k. Same Bitcoin, nearly 3x the cost.

• Efficiency alone is a 59% swing. At the same power rate, the S19 XP costs 59% more per coin than the S21 XP. That gap is pure hardware.

There’s a second layer here that changes the math. You don’t have to sell Bitcoin to cover your power bill. You can pay electricity out of pocket, often by prepaying it up front, and keep every coin you mine. That turns mining into a dollar cost average.

You buy the hardware once, then keep paying power out of pocket instead of selling your production, and every kilowatt-hour buys Bitcoin at your cost of production rather than the market price. For efficient gear that cost sits well below spot, so you’re accumulating at a discount. It also means a machine running underwater on a cash basis isn’t a reason to panic. You pay the power, you hold the coins, and as long as Bitcoin trends higher over your time horizon, those coins end up worth more than the electricity that produced them. Prepaid power takes the selling pressure off entirely and turns your power bill into a disciplined, discounted accumulation plan.

Want to see how to structure an operation exactly like this? Blockware is hosting a live webinar this Wednesday, July 1. We’ll walk through how prepaid power, hosted hardware, and the cost-of-production math fit together so you can accumulate Bitcoin below spot. Save your seat here: www.blockwaresolutions.com/webinar

The widespread consensus is that in inflation is hot and no cuts coming.

That read is wrong. And the reason is hiding in plain sight.

The market was grading a rate decision. Kevin Warsh, in his first meeting as Chair, wasn’t holding a rate decision. He was rewriting the rulebook. Once you see what he actually did, the hawkish story falls apart.

Five task forces, one direction

Warsh walked in and announced five task forces to review how the entire institution operates:

• Communications

• Data Used to Set Policy

• The balance sheet

• Productivity and jobs (including AI)

• Inflation

That’s every major lever the Fed pulls, all under review at once. No Chair in modern history has launched something this sweeping in week one.

Then he sent the signals. He gutted the policy statement. He killed forward guidance on purpose. And he refused to submit his own dot to the projections, while calling the dots his colleagues did submit “pencils, the kind with big erasers.”

Dropping forward guidance isn’t hawkish, it removes the pre-commitment that would box him in, so he can cut on his own timeline. The data task force builds the case to look past a lagged, flawed CPI print.

The inflation task force isolates energy as the thing distorting the headline number. And Warsh has argued for years that AI is a powerful deflationary force, which over time gives the Fed room to ease. Every road leads to the same place.

The tell: the dot plot is a coin flip

Here’s the single piece of evidence that the market misread the meeting.

The headline screamed that 9 of 18 officials see a hike this year. True. But that means the other 9 see rates holding or getting cut. The committee was a dead 9 to 9 split, and the median tipped to a hike by a single dot. Warsh himself didn’t even submit one, and he’s openly talking about scrapping the whole forecast.

So the market took a 9-to-9 coin flip, that the Fed Chair called low-conviction and wants to retire, and reported it as a hawkish hike signal. That’s the misread.

Energy is the only thing holding inflation up

Headline CPI ran about 4.2 percent in May. Core, which strips out food and energy, was around 2.9 percent. The entire gap is energy, and that traces back to the conflict with Iran and the disruption to the Strait of Hormuz, which moves roughly a fifth of the world’s oil.

Core was already cooling before the shock. Central banking 101 says you look through a one-time supply shock. And with a U.S.–Iran framework now announced, the one thing propping up the scary headline number may unwind on its own.

The forcing function: $39 trillion

This is what takes the thesis from “Warsh probably wants to cut” to “the math forces it.” The national debt just crossed $39 trillion. At an average rate near 3.4 percent, the government now spends over $1 trillion a year on interest alone. That’s more than the entire defense budget, and it eats roughly 14 cents of every federal dollar spent.

There’s one fast lever to slow that down. Lower rates. The gravitational pull of $39 trillion in debt points in exactly one direction.

The longer game matters too. Warsh wants to shrink the balance sheet now, and rate cuts and a leaner balance sheet aren’t opposites, they’re separate levers. But a government this indebted cannot survive sustained deflation, because falling prices make the debt harder to pay. If AI and other forces keep pressing prices down, the eventual escape is liquidity back in. A bigger balance sheet down the road. Warsh calls that an emergency tool. The debt may turn it into a certainty.

What it means for Bitcoin

We’ve seen this setup before. When the Fed started cutting in September 2024, Bitcoin was near $60,000. Three months later it had run to roughly $108,000. That’s about 80 percent in a quarter. From that first cut to the cycle high the following year, it doubled.

That’s the playbook when liquidity turns. Risk assets, and Bitcoin most of all, tend to front-run it. The market is staring at the wrong meeting. We’d rather be early.

Less taxes. More Bitcoin. What’s not to like?

You can write off 100% of the hardware & electricity costs of a Bitcoin Mining operation.

$100,000 spent on hardware + power = $100,000 deduction of active (W2 or Business) income.

This is the most tax-efficient way to build a long-term Bitcoin position.

Join us next Wednesday for a live webinar, co-hosted with 21st Financial to learn how you can implement this strategy for yourself: https://www.blockwaresolutions.com/webinar

This newsletter is for informational and educational purposes only and does not constitute financial, investment, or tax advice. Bitcoin and Bitcoin mining involve significant risk, including the potential loss of capital. Consult a qualified professional before making any investment or tax decision.

Bitcoin trades near $64,000 this week, down roughly 50% from its bull market high high. By the standard of previous bear markets, that is a shallow drawdown. The picture underneath the price is heavier than the price alone suggests.

Four separate on-chain conditions have moved into bottom-zone territory at the same time. Each one carries a long history of marking the floor of Bitcoin bear markets. Read alone, any single metric can mislead. Read together, they form one of the most reliable bottoming signals in Bitcoin’s history.

These four conditions have aligned only five times in 15 years. The fifth alignment registered last week.

Every prior instance marked a cycle bottom. One year later, Bitcoin traded a median of 130% higher. Two years later, the median gain was 499%. The weakest one-year outcome in the entire sample was still a 52% gain.

We never read a single metric in a vacuum. Markets are dynamic, and every data point needs context from the data around it. What follows is each of the four signals, the combined track record, and the one structural change that could weaken the pattern this time.

Source: Blockware Intelligence. BTC price, log scale. Data through June 16, 2026.

Here is what each of the four signals measures, where each one sits today, and why the confluence matters.

Signal 1: Percent Supply in Profit

Share of all bitcoin whose last on-chain move was at a lower price than today.

This metric measures the share of all bitcoin whose last on-chain move happened at a price lower than today. When it sits well above 50%, most of the network holds its coins at a gain. When it falls to 50% or below, roughly half of all coins in existence are underwater.

That lower condition is rare. It has only appeared at the depths of past bears: 2012, 2015, 2018, the March 2020 Covid crash, and 2022. The metric just dropped to that line again and reads near 50% today.

Bitcoin is only down about 50% from its high, which looks mild next to past cycles. The pain underneath that number runs deeper. Roughly half of every coin in circulation last changed hands above $63,000, which puts roughly half the market in the red. We can measure this precisely because every coin records the price at which it last moved on-chain. Pain at this scale has historically clustered at market bottoms.

Signal 2: The Hash Ribbon

Ratio of the 30-day to the 60-day moving average of Bitcoin network hash rate.

The Hash Ribbon compares the 30-day moving average of network hash rate against the 60-day moving average. When the 30-day average falls below the 60-day average, the ribbon is flaring, and that flaring signals miner capitulation. The ratio sits at 0.987 today, below the 1.0 line.

This is the signal we watch most closely at Blockware, because it speaks directly to mining economics. A flaring ribbon means miners are powering machines off, network hash rate is contracting, and difficulty is adjusting lower. Two forces are driving the current capitulation.

The first is the marginal operator. When Bitcoin traded above $100,000, a miner could run older, less efficient hardware at a higher power rate and still clear a profit. As price fell, that margin disappeared and those operators were forced to shut down. These miners are large net sellers by necessity. They sell most of the bitcoin they produce to cover power and operating costs. When they capitulate, that recurring sell pressure leaves the market, and the disciplined operators with efficient hardware and low power costs absorb a larger share of the block reward.

The second force is structural. The largest public miners are leaving Bitcoin mining to host AI compute. The infrastructure overlaps heavily. Land, power capacity, transformers, and containers all transfer from one use to the other. AI hosting contracts lock in consistent revenue for up to ten years, and some of those contracts pay more than mining produced even when Bitcoin traded at $125,000.

The result is a shrinking field of miners competing for a fixed block reward. Blockware clients are currently earning roughly 15% more bitcoin per machine than they were at the start of 2026. Every deep flare in the Hash Ribbon has coincided with a major bottom.

Signal 3: Cost Basis of Coins Acquired in the Last 2 Years

Supply-weighted average price paid by everyone who bought within the past two years.

This signal takes every coin acquired over the trailing two years and calculates the supply-weighted average price paid. That figure currently sits at $88,000. With Bitcoin near $64,000, the average buyer from the last two years is underwater by about 25%.

Price has only dropped below this two-year cost basis during bear markets: 2015, 2018, and 2022. Each of those instances proved to be a strong long-term entry point.

One caution belongs here. Price can remain below this level for an extended stretch. It stayed under the line for roughly a year in 2015, and the 2018 and 2022 episodes told a similar story. This level marks a favorable accumulation zone. It rarely calls the exact bottom to the day. Anyone entering Bitcoin should be working with a time horizon of at least four years. On that horizon, buying below the two-year cost basis has historically rewarded patience.

Signal 4: Long-Term Holder Position Change

30-day net change in the supply held by long-term holders.

The final signal measures the 30-day net change in supply held by long-term holders, defined as any wallet that has held its coins for six months or longer. When the reading is positive, long-term holders are accumulating. When it is negative, they are distributing.

There are only two reasons a long-term holder sells. The first is exuberance, which shows up at the top of bull markets when unrealized gains are largest. That is the source of the deep red spikes in 2013, 2017, 2021, and 2024. The second is capitulation, which shows up at the bottom.

Long-term holders capitulated in February when Bitcoin fell to $60,000. They released coins into the market, and those coins have been steadily absorbed by buyers since. Over the past three months the reading has stayed positive, with long-term holders now adding roughly 43,000 BTC over the trailing 30-day window.

The shift from capitulation to accumulation is the part that matters. Bitcoin’s supply is fixed, demand from the strongest hands is now net positive, and that imbalance tends to resolve through higher prices. The adjustment can lag, but the direction is set.

The Confluence

Each signal carries weight on its own. The reason this week matters is that all four are flashing at once.

Supply in profit near 50%. The Hash Ribbon flaring. Price below the two-year cost basis. Long-term holders accumulating. That specific combination has occurred only five times in 15 years, and every prior occurrence sat at a cycle bottom.

The forward returns from those bottoms were substantial. One year later, Bitcoin posted a median gain of 130%. Two years later, the median gain was 499%. The weakest single one-year result in the sample was a 52% gain.

The overview chart at the top of this issue also marks the near-misses, the moments when three of the four conditions lined up but long-term holders were still distributing. Those instances did not carry the same signal. The fourth condition, long-term holder accumulation, is the confirmation that turns three coincident signals into a historically reliable bottom. As of last week, that confirmation is in place.

If this alignment rhymes with the four before it, the implied floor is roughly $180,000 per bitcoin by the summer of 2028, with a median path closer to $375,000.

Turn the Money You Owe the IRS Into Bitcoin

The same miner capitulation that flashes as a bottom signal is also a direct tailwind for disciplined operators. As weaker miners power down and the largest public miners redirect their fleets toward AI compute, the bitcoin those machines would have produced is redistributed to the miners who remain. That is why Blockware clients are earning more bitcoin per machine today than they were six months ago, even with price lower.

A single filer earning $150,000 in 2026 will owe $24,734 in federal income tax. That capital leaves your balance sheet for good the moment the check clears.

Section 168(k) bonus depreciation offers another path. A Tier 2 Blockware package puts roughly $150,000 of enterprise mining hardware to work, and under current law you deduct 100% of that cost in the first year. That single deduction is large enough to offset $150,000 of income and take that federal tax bill to zero.

The money you would have sent to the IRS buys hardware instead. It runs at a locked power rate across our seven facilities and sends Bitcoin straight to your wallet every single day. A sunk tax expense becomes a Bitcoin-producing asset you own.

See the full strategy at blockwaresolutions.com/info.

This newsletter is for informational and educational purposes only and does not constitute financial, investment, or tax advice. Bitcoin and Bitcoin mining involve significant risk, including the potential loss of capital. Consult a qualified professional before making any investment or tax decision.

They acquired Siiibo Securities, a licensed Japanese securities firm, giving them a tool no other Bitcoin treasury company on Earth has. CEO Simon Gerovich called the significance “hard to overstate.” We agree.

Here is the whole story in five lines:

• Metaplanet is buying a licensed securities firm, closing in July, rebranding it Metaplanet Securities.

• That license lets them build and sell Bitcoin-backed financial instruments directly to Japanese investors.

• Japan is the perfect market: $7.4T in idle cash, negative real yields, and a tax code that punishes owning Bitcoin directly.

• Nobody can copy this. It requires a massive Bitcoin treasury and a Japanese securities license. Metaplanet now has both.

• The stock trades below the value of its Bitcoin, and a top equity research firm just put a Buy on it.

The rest of this newsletter breaks down why each of those matters.

What Actually Happened

Metaplanet acquired 100% of Siiibo Securities, a licensed Japanese securities firm and a pioneer of the country’s online corporate bond market. The deal closes in July, after which the company becomes Metaplanet Securities.

On the surface it looks small. A Bitcoin company bought a bond broker. But Gerovich calls it the first concrete step in Project Nova, their plan to build an entire Bitcoin-based financial ecosystem inside Japan.

The license is what matters. It gives Metaplanet the legal ability to build and sell Bitcoin-backed financial products directly to Japanese investors. Products like a Bitcoin-backed bond, which is a very different instrument from the preferred-equity “digital credit” products we have seen in the US.

Why Japan Is the Perfect Market

Three forces have created a $7.4 trillion pool of capital with nowhere good to go.

1. Rates. A decade of zero and negative rates trained Japanese households to hoard cash. Now Japan has flipped to inflation, the BOJ is hiking, and the 10-year government bond pays only about 2.5%. After inflation, that is still a negative real yield.

2. The yen. Down roughly a third against the dollar over five years, and about 10% in the past 12 months alone. Savers are losing purchasing power by the day.

3. Taxes. Gains on Bitcoin in Japan are currently taxed as miscellaneous income at rates that can reach 55%. Owning Bitcoin directly is brutally inefficient.

Here is the key. Get that same Bitcoin exposure through a security, an equity or a bond, and you sidestep the punitive direct-ownership tax. You get the upside without the 55% hit on your capital gains.

So you have an enormous pool of yield-starved capital, and a tax code that pushes it toward securitized Bitcoin exposure. Metaplanet just bought the license to sell exactly that.

What a Bitcoin-Backed Bond Actually Is

It is a bond that pays a higher yield because the proceeds buy Bitcoin.

A normal bond is debt. You lend capital, collect a fixed rate, get your principal back at maturity. A Bitcoin-backed bond works the same way, except the issuer takes your principal and buys Bitcoin with it.

The math is clean. Japanese government bonds pay about 2.5%. Bitcoin has historically appreciated 15% to 25% per year. Metaplanet could issue a bond at 5%, 6%, or 7%, buy Bitcoin, and still come out ahead. They borrow low and hold an asset that compounds faster. A simple carry trade.

For the buyer: a yield well above government bonds, with bond-like stability, and without the day-to-day volatility of holding Bitcoin directly. Bitcoin-like returns with bond-like stability.

Why this is bigger than it sounds

A real bond is debt, and that changes who is legally allowed to buy it.

The US “digital credit” products from companies like Strategy and Strive are legally preferred equity. A huge universe of institutional money, pension funds, insurers, and conservative bond funds, is forbidden by mandate from holding equity, no matter how good the yield.

A true bond fits inside a fixed-income mandate. It works inside the rules instead of fighting them, which unlocks pools of capital that preferred equity can never reach. It also carries a legal obligation to repay, where preferred equity can skip a dividend with no penalty. We see the US products as a stepping stone. A true Bitcoin-backed bond is the next form, and Metaplanet may be the one to build it.

Why Only Metaplanet Can Do This

It takes two things almost impossible to assemble at once, and Metaplanet just put both under one roof.

• A massive treasury. Metaplanet holds 40,177 BTC, the largest corporate stack in Asia and a top-five holding worldwide. Any competitor would have to accumulate tens of thousands of coins from scratch, in a market where everyone is racing to do the same.

• A securities license. Selling regulated securities to the public in Japan requires a Type I financial instruments license. Metaplanet did not spend years applying for one. They bought one. That is what the Siiibo deal really was: the legal key to the entire Japanese securities market in a single move.

No other company has 40,000+ BTC, is domiciled in Japan, and holds the license. Metaplanet is one of one.

What This Means

A small fraction of $7.4 trillion rotating in does two things: it pushes Bitcoin higher, and it grows Metaplanet’s treasury. More capital raised means more Bitcoin bought, a bigger treasury, and more bonds they can issue. That is a flywheel.

And the market is mispricing it. Metaplanet’s stock (3350 in Tokyo, MTPLF on US OTC markets) currently trades below the value of its Bitcoin holdings. Its multiple to net asset value is under one. If there is any company that deserves a premium to its Bitcoin, it is the one holding the largest stack in Asia with the only license to monetize it.

For context, Metaplanet traded near a 10x multiple to net asset value this time last year, and nothing structural has weakened the thesis since. The difference now is the license. Benchmark, a top equity research firm, rates the stock a Buy with a ¥2,400 end-of-2026 target. In our view the market has not begun to price what Project Nova could become.

The Risks

We will steelman the other side. This is not a sure thing.

• The deal hasn’t closed. Everything here is intent until the first product ships.

• It lives and dies on Bitcoin. A real bond must be repaid. If Bitcoin crashes and stays down, the collateral weakens and the obligation remains. That is genuine default risk.

• Adoption may be slow. Conservative savers have sat in cash for a generation. No guarantee they rush in quickly.

None of these change the structural setup. They are reasons to size a position with eyes open, not reasons to ignore it.

The Bigger Picture

Japan is a preview of where the US is headed. Older population, debt-to-GDP above 200%, a retired generation dependent on government support, and over a decade of extreme monetary policy to hold it together.

The US is on the same path. Boomers retiring into Social Security and Medicare, debt-to-GDP already north of 100% and climbing. As that ratio rises, the odds of Washington running Japan-style policy rise with it. Japan is not the exception. It is the leading edge.

That is the backdrop behind everything we cover. A financial system being slowly debased, and Bitcoin on the other side of the trade. Metaplanet just built the bridge between the two, in the one jurisdiction where the conditions are perfect.

We will be watching closely.

All content is for informational purposes only. This Blockware Intelligence Market Forecast is of general nature and does consider or address any individual circumstances and is not investment advice, nor should it be construed in any way as tax, accounting, legal, business, financial or regulatory advice. You should seek independent legal and financial advice, including advice as to tax consequences, before making any investment decision.

Short-term holders dumped coins at a loss at their cost basis, the same behavior we flagged two weeks ago through SOPR. ETF allocators sold ~$4.3 billion over 13 straight days. Now miners, the most economically rational participants in the entire ecosystem, are unplugging machines at a pace seen only a handful of times in Bitcoin’s history. Meanwhile long-term holders sit on a record 15 million BTC and old coins are not moving. Forced selling always ends before the price recovers, and every data set we track says we are deep into the final innings of it. The bottom is a process, not a moment. This is what the process looks like.

Key Takeaways

• Bitcoin trades near $63,000, down roughly 22% from the May rejection at the short-term holder cost basis and about 50% below the October 2025 high of $125,000.

• Spot Bitcoin ETFs posted their longest outflow streak ever: 13 straight trading days and $4.3 billion in redemptions from May 15 through June 3. That streak has now broken.

• Mining difficulty is set to drop roughly 10.3% this weekend, the 11th largest downward adjustment in Bitcoin’s history and the second double-digit drop of 2026.

• Hash Ribbons have flipped into miner capitulation. Every major Bitcoin bottom of the past decade featured this exact signal.

• May CPI came in at 4.2%, the first reading above 4% in three years. Nearly all of it was energy. Core inflation was 2.9% and core goods prices actually fell.

• The 10-year Treasury yield held near 4.5% even after the hottest inflation print since 2023. The Fed meets June 17 and is expected to hold.

• Equities had a whiplash week: the worst Nasdaq day since April 2025, followed by a broad rally as the US and Iran moved toward a peace deal that could reportedly be signed within days.

• Two trades account for the entire S&P 500 gain in 2026: AI-driven technology and war-driven energy. The other nine sectors are a net drag on the index, and financials and staples sit at the bottom.

• The sellers are running out. Short-term holders capitulated at their cost basis, ETF outflows hit records, and now miners are unplugging machines. These are all signs that point towards a bottom formation.

• SpaceX reaches a $2T+ Market Cap on IPO Day. With ~18,000 BTC on their balance sheet, they are the largest company on earth to hold a Bitcoin position.

Two weeks ago we wrote that Bitcoin had been rejected at the short-term holder cost basis for the fourth time in four years, and that history pointed to roughly two months of consolidation before the next leg higher. The market chose a faster and more painful route. Instead of going sideways, BTC flushed from the rejection near $82,000 down to lows around $61,000, a 25% decline in under a month. The psychology is the same one we described then: short-term holders bought the rally, got turned away at their break-even level, and sold. They just did it with urgency instead of patience.

At the lows, Bitcoin was down 51% from the October 2025 peak of $125,000, the deepest drawdown of this era. The Crypto Fear & Greed Index touched 8 on June 8, its lowest reading since April 1 and deep in extreme fear. For context, the 2022 bear market bottomed at a 77% drawdown and 2018 bottomed at 84%. This decline has been driven entirely by recent buyers and ETF redemptions, while the on-chain structure underneath has not broken. Long-term holders still sit on a record supply of roughly 15 million BTC, and old coins are still not moving.

The ETF data tells you exactly who was selling. US spot Bitcoin ETFs recorded 13 consecutive trading days of net outflows from May 15 through June 3, the longest streak since the products launched in January 2024, shedding $4.33 billion and 59,351 BTC according to Galaxy Research. Total ETF holdings fell about 7% from their October peak to 1.28 million BTC. These funds were the marginal buyer on the way up, and for three weeks they were the marginal seller on the way down. The streak broke on June 4 with a small net inflow, and flows have stabilized since.

Short-term holders capitulate & ETF allocators capitulate first. Miners capitulate last, because turning off a machine is a business decision, not an emotional one. A miner only unplugs when the Bitcoin coming out of the machine is worth less than the electricity going in. That is happening right now, and the slower block confirmation times makes it impossible to hide.

Hash Ribbons compare the 30-day average of network hashrate to the 60-day average. When the 30-day crosses below the 60-day, machines are coming offline faster than new ones are being deployed. That is miner capitulation, and the ribbons have just inverted again. This signal flashed at the $60,000 low in Q1 of this year, and before that it marked the December 2018 bottom, the March 2020 COVID crash, the 2021 China mining ban, and the 2022 bear market low. It does not fire often. When it does, it has historically been one of the best accumulation signals Bitcoin has (aside from weather-induced curtailments).

Network hashrate peaked above 1,100 EH/s in late 2025 and daily readings are now under 900 EH/s. Two forces are at work. The first is pure economics: older machines and operations paying high power rates simply do not make sense economically with BTC at $62,000, so they go dark. The second is structural: several large public miners are redirecting power and data center capacity toward AI and high-performance computing, permanently removing hashrate from the network. Both forces shrink the competition for everyone who stays plugged in.

Bitcoin recalibrates mining difficulty every 2,016 blocks, roughly every two weeks, so that blocks keep arriving every 10 minutes on average regardless of how many machines are running. With hashrate bleeding off, the next adjustment lands this weekend at block height 953,568, and it is projected to cut difficulty by roughly 10.3%, from about 139 trillion down to about 125 trillion. It follows the 11.2% drop in February and would be the second double-digit decline of 2026. For every miner who stayed online, this is an immediate raise: the same machine earns roughly 11% more BTC overnight.

If the estimate holds, this will be the 11th largest downward difficulty adjustment in Bitcoin’s history. Look at the company on this list: the July 2021 China mining ban, the March 2020 COVID crash, the December 2018 bear market bottom, the November 2020 China rainy season migration. These adjustments cluster at moments of maximum stress, and every single one preceded a major recovery. The only year with multiple top-eleven drops was 2021, and that required a government banning mining across an entire country. This one is happening on economics alone.

Block times are the receipts. The network targets one block every 10 minutes, and the current epoch is averaging 11.1 minutes per block. Every slow block is direct, verifiable evidence that machines went dark, because fewer machines means fewer lottery tickets per second. You can also see the cycle play out across recent epochs: blocks slowed into the February drop, snapped back to 8.7 minutes once difficulty fell and hashrate plugged back in, and have now slowed again. The protocol is doing what it was designed to do, which is protect the miners who survive.

Difficulty drops are when mining economics reset in favor of the survivors. Machines that are unprofitable for an over-leveraged operator at $0.08/kWh are very profitable at Blockware’s hosting rates, especially with the 100% bonus depreciation tax benefits layered on top. If you want to see exactly what this weekend’s adjustment does to machine-level ROI, sign up for a free consultation with the Blockware team: https://www.blockwaresolutions.com/info/

Macro: The First 4-Handle CPI in Three Years

Wednesday’s May CPI print came in at 4.2% year-over-year, the first reading above 4% since 2023, with prices rising 0.5% on the month. Both numbers matched expectations, and the composition matters far more than the headline. Energy jumped 3.9% in a single month and is now up 23.5% over the past year, a direct result of the conflict with Iran and the disruption around the Strait of Hormuz. Core inflation was just 2.9% annually, the monthly core reading of 0.2% actually came in below estimates, and core goods prices fell outright. This is a supply shock from a war, not an overheating economy. If/when the conflict de-escalates, headline CPI likely follows, and dovish policy gets priced in.

The bond market said the same thing. The 10-year Treasury yield was essentially flat after the print and sits near 4.53%, even though Thursday’s PPI came in at 6.5% year-over-year, the hottest producer inflation since November 2022. Traders have flipped from pricing rate cuts to pricing a hike, with a quarter-point increase fully priced by December, and the Fed is expected to hold at its June 17 meeting. Sit with that combination for a second. Inflation is above 4%, the government is running massive deficits, a war is adding to the bill, and the 2-year Treasury now yields less than the inflation rate. Holders of short-term government debt are losing purchasing power, which is precisely the environment Bitcoin was built for. The long-term fiscal math has not changed: at some point the interest expense forces the Fed to step in, and that resolution favors hard assets.

Equities packed a full cycle into seven trading days. The S&P 500 closed above 7,600 for the first time on June 2, then the Nasdaq dropped 4.18% on June 5, its worst day since April 2025, as a crowded chip trade unwound on Broadcom’s AI outlook and a much hotter-than-expected jobs report (172,000 jobs versus 80,000 expected) spiked yields. Iran escalation knocked the Dow down 900 points on June 10. Then everything reversed on June 11, with the Nasdaq up 2.5% and the Russell 2000 up 3%, as the US and Iran signaled a deal was close. Reports now suggest an agreement could be signed as soon as Sunday, including reopening the Strait of Hormuz within 30 days, and oil has already pulled back to around $84.

Underneath the index level, the gains are remarkably narrow. Technology is up roughly 32% in 2026, and at about a third of the index weight it has contributed nearly 11 percentage points to the S&P 500’s return, while energy added another point on war-driven oil prices. The index itself is up only 8.4% on the year, which means the other nine sectors, roughly 62% of the market, have been a net drag. Financials and consumer staples are the two worst-performing sectors of 2026. Strip out the AI trade and the war trade, and the average stock is down this year.

That concentration tells you what this market actually is: a bet on the AI capital expenditure cycle. It also explains the fragility on June 5, when one soft outlook from Broadcom dragged the entire index down 2.6%, because there is little else holding it up. For now the cycle keeps delivering. Adobe posted record revenue of $6.62 billion this week on AI-driven demand, Citi laid out a case for AMD becoming Meta’s second GPU source with a $575 price target, and Marvell surged 25% after Jensen Huang called it the next trillion-dollar company. This is the same buildout we have covered from the mining side, where power is the binding constraint and Bitcoin miners hold some of the most valuable energized capacity in the country.

The week’s exclamation point is SpaceX, which began trading on the Nasdaq today under the ticker SPCX after the largest IPO in financial history. The company priced 555.6 million shares at $135 each, raising $75 billion at a valuation just under $1.8 trillion, which puts it among the ten largest companies in the world on day one and makes the deal nearly three times the size of Saudi Aramco’s 2019 record. Roughly 30% of the offering was allocated to retail investors, about triple the industry norm, and Musk retains over 82% voting control. Fifteen days after listing, SpaceX enters the Nasdaq-100, expected to trigger an estimated $22 to $27 billion of mechanical index buying in early July. A $75 billion raise getting absorbed in a single week tells you liquidity in this system is abundant. The bid is simply concentrated in AI, space, and hard assets.

The more interesting story around SpaceX is that they immediately jumped to the number 8 spot in public Bitcoin treasuries; with more than 18,700 BTC on their balance sheet. However, in terms of Market Capitalization, Space X is the largest publicly traded holder of Bitcoin, surpassing Musk’s other company, Tesla.

Sign up here: www.blockwaresolutions.com/webinar

Doing nothing is the biggest risk.

There is a kind of risk that never shows up on a price chart. It is the risk of inactivity.

Most people treat holding Bitcoin and collecting a paycheck as the safe, default path.

No decisions, no moving parts, nothing to manage.

Two costs run quietly in the background the entire time you do nothing.

• Your income is taxed at full freight every year.

• Your Bitcoin, the best collateral ever created, sits idle and doesn’t function as working capital

If you earn a high income in the United States, your largest lifetime expense is tax. Not your house. Not your lifestyle. Tax. And for most high earners, it is the one expense they never actively manage.

Here is what a $250,000 single filer pays in combined federal and state income tax, mapped across the country:

A $250,000 earner pays $57,063 in federal income tax. Add state income tax and the bill climbs:

• Oregon: $80,000

• California: $77,000

• Hawaii & Minnesota: $76,000

• Maine: $74,000

• New York, Montana, South Carolina: $72,000

During a lifetime, the cost (and opportunity cost) compounds significantly.

Over a 30-Year Career a $250k per year earner will pay ~$1.7 million in Federal Income Tax. If the tax bill were instead re-directed into an asset with a 20% CAGR, that would accrue to ~$67 million over the 30-year period.

$67 million. That is your opportunity cost.

Few assets compound at 20% per year consistently. Bitcoin is one of the few.

According to research from Strive ( ), the 10th percentile of Bitcoin 4-Year CAGRs is 27%. In other words, if you pick any random 4 year stretch in Bitcoin’s history, 90% of them will have a CAGR of 27% or higher.

Now, unfortunately, you cannot forgo income tax to directly buy Bitcoin. However…

…Under Section 168(k), 100% bonus depreciation lets you deduct the entire cost of Bitcoin Mining equipment in a single tax year. The deduction is worth your marginal tax rate in cash, so the higher your bracket, the more it puts back in your pocket.

Consider a bundled mining package:

• $41,067 of hardware (9 Antminer S21 XPs)

• $23,430 of electricity (1 full year of power prepaid at $0.072 per kilowatt hour)

The package costs roughly $62,000, all of which can be deducted against active income. At the 28% combined rate in our model, the deduction returns $17,466 this year. For a top-bracket earner in California or New York, it approaches $31,000.

So before the machines mine a single Bitcoin, you have already turned a slice of your largest annual expense into Bitcoin-producing assets.

Let’s model how this hypothetical mining operation would perform on a 4-year time horizon. Here are our (conservative) assumptions:

• Bitcoin compounds at 20% a year.

• Network difficulty rises 10% a year.

The April 2028 halving cuts the block reward. Each year’s power bill is added to the loan rather than paid out of pocket, and every Bitcoin the machines mine is held, not sold. The Year 1 tax refund, roughly $17,500 at a 28% rate, is reinvested into Bitcoin in Year 2, which is the step up you see in the green line.

By the end of Year 4, the machines have produced about 1.14 BTC on top of your original stack. The 2 BTC of collateral is worth roughly $288,000. The loan sits near $178,000. And the part that matters most for safety: if you post the mined Bitcoin back as collateral, your loan-to-value ratio falls to around 39%, below where you started, even though the loan balance grew along the way.

Watch the two forces separate. Your collateral compounds at Bitcoin’s rate, near 20% a year. Your loan grows at 9.99% plus the power you fold into it, closer to 10%. Because the asset climbs faster than the liability, the space between them, which is your equity, widens every year. That is the whole idea in one line: the collateral compounds against the liability.

Do nothing, and four years out you hold 2 BTC worth about $288,000. You also wrote a large check to the government every one of those years, with nothing to show against it.

Give your Bitcoin a second job, and you are ahead from the first year. You still hold the original 2 BTC. On top of it you hold the roughly 1.14 BTC the machines produced, the Bitcoin bought with your Year 1 tax refund, and the mining hardware itself. The Bitcoin alone is worth about $481,000 by Year 4 against a loan near $178,000. Counting every asset against the loan, you beat simply holding your 2 BTC in every single year, from about $9,000 ahead in Year 1 to roughly $23,500 by Year 4. And you never sold a single coin.

Here is the key insight. The price risk on your 2 BTC is the same in both paths. You carry the exact same Bitcoin exposure either way. The only question is whether that exposure sits idle and fully taxed, or whether it works alongside production, depreciation, and a positive spread between a 20% asset and a 10% loan.

Not financial or tax advice. 100% bonus depreciation under IRC Section 168(k) is current US law; consult your CPA. All figures are estimates based on the stated assumptions and a starting BTC price of $69,350.

Sign up for a free consultation with a member of Blockware’s team to see how this could apply to your specific situation: https://www.blockwaresolutions.com/info

Three times in the past four years, a single on-chain metric has rejected Bitcoin. And every single time, it was followed by roughly two months of consolidation before the next major leg higher.

It just happened again in May 2026.

The level is called the Short-Term Holder Realized Price. It is the average cost basis of every Bitcoin buyer from the past 155 days. This is not a technical indicator or a moving average. It is pulled directly from Bitcoin’s transparent, publicly verifiable blockchain, across millions of transactions and wallet addresses.

The reason it works as resistance comes down to basic human psychology. Short-term holders are momentum and sentiment driven. They buy on upswings, they sell on downswings, and when the price finally recovers back to their break-even level, the overwhelming majority of them take their money off the table. This behavior shows up on the blockchain every single time.

Here is how it has played out historically:

November 2022 — Bitcoin was rejected at the STH realized price, dropped from $20,000 to around $16,000, and consolidated there for two months. That was the starting point for what became one of the best bull markets in Bitcoin’s history, with BTC going up over 100% in back-to-back years.

August 2024 — Bitcoin looked like it was going to break through but failed. Two months of choppy consolidation followed before BTC ran from roughly $50,000 to $100,000 in just three months.

February 2025 — Same dynamic. Failed breakout, two months of consolidation, then all-time highs shortly after.

May 2026 — The breakout failed again. If this pattern continues, and it has held every single time over the past four years, we are probably looking at continued consolidation until around mid-July before the next leg up begins.

How Profitable is Bitcoin Mining Actually?

Head of Blockware Intelligence, Mitchell Askew, joined Mitch Moore on the Strong Wealth Podcast to discuss all of the dynamic variables that impact Bitcoin Mining Profitability:

BTC Price, Mining Difficulty, Machine Types, Power Rates, Artificial Intelligence, and more!

For a masterclass in all things Bitcoin Mining, check this out:

If you’re interested in learning more about how Bitcoin Mining (and the associated tax benefits) can apply to your specific situation, sign up for a free consultation with a member of the Blockware team: https://www.blockwaresolutions.com/info/

Short Term Holder Spent Output Profit Ratio (SOPR)

This metric looks at the price at which short term holders are moving BTC relative to their cost basis.

SOPR < 1 (red) = moving coins at a loss

SOPR > 1 (green) = moving coins at a gain

We’re seeing this capitulation-at-cost-basis through this metric — short-term holders are now selling coins at a loss in the aggregate. This indicates that some supply overhead is at play; which will potentially cause BTC to consolidate for another 2 months.

While short-term holders are selling at their cost basis and keeping a lid on price, long-term holders have quietly accumulated a record high of nearly 15 million Bitcoin. Long-term holders are defined as anyone who has held their Bitcoin for at least five months. These are not momentum chasers. They have sat through drawdowns, through capitulation events, through months of sideways price action, and they have not sold.

That divergence between the two groups tells you a lot about what comes after the consolidation.

Short term: Sideways to down

Medium term: Breakout into next bull run

Coin Days Destroyed: Old Coins Are Not Moving

Coin Days Destroyed is one of the more nuanced on-chain metrics available. Unlike simple transaction volume, CDD weights each Bitcoin by how long it was held before being moved. One Bitcoin held for 1,000 days and then transferred destroys 1,000 coin days. One Bitcoin bought yesterday and moved destroys just one.

This is useful because it tells us not just how much Bitcoin is moving, but who is moving it.

Big spikes in CDD can happen for two reasons. The first is a large capitulatory event where a lot of Bitcoin, including older coins, gets moved all at once. That is actually what happened earlier in this cycle when Bitcoin dropped from around $120,000 down to $80,000 and ultimately to $60,000. A brief, sharp spike in CDD told us that a meaningful amount of supply, some of it held for a while, was being moved rapidly. That was capitulation.

The second way CDD spikes is during a prolonged bull market top, like 2017, where you see a slow and gradual rise over many months rather than one sharp jerk higher. That kind of rise is driven by older coins selling into strength over time.

Right now, CDD is at a multi-year low. It has not been this low since early 2024.

This tells us two things. Overall activity on the blockchain is low. And the coins that are being moved are not old coins. Long-term holders are not selling at current prices. The activity we are seeing is almost entirely coming from that short-term, emotionally-driven cohort. Once they finish cycling out, the only capitulation left will largely be gone.

Risk Assets Hit New All-Time Highs

This week SPY, QQQ, NDQ, and IWM all printed new all-time highs. That is a broad-based move, not a narrow one. Large caps, small caps, growth, and the overall market moving together to record levels is about as risk-on an environment as you can get.

For Bitcoin, this backdrop matters. When capital is flowing freely into risk assets across the board, Bitcoin tends to benefit. The short-term holder consolidation we outlined in the on-chain section is playing out against one of the more constructive equity backdrops in recent memory. That is not a bad setup for when the consolidation resolves.

Rates pulled back this week, which offered some short-term relief across markets. Bond volatility, as measured by the MOVE index, has been trending down and is currently sitting around 69 — well off the elevated levels seen throughout 2022, 2023, and into 2025.

The pullback in rates is worth noting, but it is probably not the start of a new trend lower. The more likely interpretation is that this is a relief rally within a broader uptrend. Rates have been grinding higher on a structural basis for years now, and nothing about the current fiscal picture gives a good reason to believe that changes in a meaningful way anytime soon. The U.S. continues to run large deficits, issuance is not slowing down, and foreign demand for Treasuries remains a question mark.

For Bitcoin, the implications cut both ways depending on your time horizon. Rates rising in the near term is a headwind. Higher rates pull capital toward yield-bearing instruments and away from non-yielding assets. That is a short-term risk-off dynamic.

Over the medium and long term though, persistently high rates on a mountain of government debt is precisely the kind of fiscal pressure that historically forces central banks toward yield curve control or outright QE. The U.S. cannot afford to let rates run indefinitely. At some point the interest expense on the debt becomes the dominant budget line item and the Fed has to step in.

For a miner with 10 machines, that’s over $1,600 per year in electricity savings.

If you’ve been looking for a sign to jump into machines, this is it.

All miners purchased can be deducted fully in year-1 under section 168(k). This means for every $1 spent on miners, you can offset $1 of active income. Sign up for a consultation with a member of the Blockware team to learn more: https://blockwaresolutions.com/info

Bitcoin is holding strong at the short-term holder cost basis during this recent pullback. “Sell the rip” switching to “buy the dip” is a good sign that Bitcoin likely continues to trek higher from here in the short / medium term.

The chart below visualizes “buy the dip” behavior using the help of on-chain data. Addresses containing 0.01 to 1 BTC hold a combined ~1.33 million BTC. As a cohort, they’re by no means a major player when it comes to the market as a whole. However, prices are set at the margin, which means a slight shift in supply/demand dynamics can cause a change in price action; especially during times like now when trading volume & overall market activity is low.

This cohort, for the most part, is constantly accumulating. However, they’ve historically accumulated with larger size during Bitcoin bottoms. Note the spike in holdings in early February as BTC touched $60,000. We’re seeing a similar behavior now:

• BTC Dips

• Hardcore Holders Aggressively Buy the Dip

The situation in the treasury market is becoming increasingly more bleak as time goes on. The 30-Year Treasury Yield has reached ~5.08%, it’s highest level since 2007. Rising rates are going to increase pressure throughout the economy as borrowing costs rise for everyone; from those drowning in credit card debt, to new families taking out a mortgage, to the United States Government itself.

Oil prices remaining elevated puts the administration in a two-front battle: rising yields and rising prices. These battles cannot be fought simultaneously for a prolonged time without sever consequences towards the economy. Something has to give, that something will likely be a lower Fed funds rate and more quantitative easing.

Interestingly, gold has not followed long-end treasury yields higher on this latest move higher. Rising yields in Q4 2025 & Q1 2026 were accompanied by a “flight to safety” in gold; a non-sovereign store of value that hedges against over-indebted governments. However, that’s not been the response from gold as of late. This is a sign that, despite the uncertainties in the macro landscape, the market is risk-on.

A risk-on bid for a non-sovereign store of value will result in more capital inflows for Bitcoin.

When looking at the BTC/Gold chart, it is even more evident that a bottom has been formed. Based on the current Gold price of ~$4,500/ounce, a return to the all-time high of 38 gold ounces per 1 Bitcoin implies a BTC price of ~$171,000.

Twelve months ago, a Blockware client deployed ~$101,000 into ten Antminer S21 XP units at $7,830 per miner. 270 TH/s units hosted at $0.07/kWh. Here’s how the operation actually performed, coin by coin and dollar by dollar.

Bitcoin is down ~26% year-over-year. Surely this means Bitcoin mining hasn’t yielded the best results, right? Wrong.

In this newsletter, we’ll take a look at the 1-year returns of a ~$100k deployment into Bitcoin miners. Here’s the setup:

• 10 Antminer S21 XPs ($78,300)

• 12 Months of Electricity for the machines at $0.070/kWh ($22,779)

• $25 Setup Fee per Miner ($250)

• Total Investment: $101,329.79

The fleet never mined at a loss on an operating basis. With electricity at $0.07/kWh, every bitcoin produced cost roughly $49,100 in power; well below where Bitcoin has traded all year. That ~$27,000 spread between cost of production and spot price is the definition of a healthy margin, and it held through a period of meaningful network difficulty growth.

MONTHLY PRODUCTION

The table below breaks down the monthly revenue, both in terms of Bitcoin and in US Dollars. There are two noteworthy trends:

• The decrease in dollarized monthly revenue as the BTC price declined. In August, the monthly rewards peaked around $4,900 before dropping with the BTC price.

• The increase in BTC revenue from November until today. Mining difficulty has dropped due to large miners unplugging machines in favor of Ai servers. This has resulted in more BTC revenue for our clients.

While the volatility of BTC can be a deterrent, the most practical way to mine is as a Bitcoin accumulation strategy. Holding 100% of the mining rewards, benefiting from long-term BTC price appreciation. Practically, this can be achieved by pre-paying electricity up-front or paying out-of-pocket as you mine, rather than selling BTC mining rewards to cover the power bill.

THE TAX STORY

Bitcoin mining is one of the few asset acquisition strategies that comes with a first-year tax deduction on the full capital outlay. Under 100% bonus depreciation, the entire $78,300 hardware cost is deductible in year one. Prepaid power qualifies too. That changes the math significantly.

Mining doesn't just accumulate BTC. It converts operating capital into a tax-advantaged, self-custody Bitcoin position. The $25,171 tax benefit alone represents the equivalent of ~0.327 BTC at current prices. Combine that with the ~0.455 BTC acquired through mining, and approximately 60% of the cap. ex. has been returned in just 12 months.

• Net Mining Revenue: 0.455 BTC (~$35,035)

• Net 2025 Tax Savings: $25,171

• Returned Cap. Ex.: ~59.4%

If you’re interested in running this strategy for yourself, lowering your taxable income and increasing your BTC position, sign up for a free consultation with a member of the Blockware team. One of our mining experts will evaluate if this strategy makes sense for your goals and situation.

Sign up here: https://blockwaresolutions.com/info

Sign up for a free consultation

With April CPI hitting a 3-year high of ~3.7%, entities like Goldman Sachs & Bank of America are tapering their rate expectations. The market is now pricing in less than a 1% probability of Federal Reserve rate cuts in 2026. In fact, the market is now placing a 38% probability of at least 1 interest rate hike before the end of the year.

Although there are legitimate, data-backed reasons to believe that the Fed will and should keep interest rates where they are at, the market is missing a key factor, and it’s hiding in plain sight…

Read more

They use assets to acquire more assets. They use the tax code the way it was written to be used. And they build systems where each dollar they deploy does more than one job at a time.

What we are about to walk through is exactly that kind of system. Mark Moss call is The Perpetual Bitcoin Machine. And it is one of the most compelling wealth strategies available to Bitcoin holders today.

Here is the core idea in one sentence: Borrow against the Bitcoin you already own, use those funds to purchase hosted Bitcoin miners, write off the full cost against your tax bill, and collect newly minted Bitcoin every single month — while your collateral keeps appreciating.

It’s a proven blueprint just with a new asset.

Let’s break down every step.

Before we get into the mechanics, let’s establish the starting point. This strategy is built for someone who:

1. Already holds a meaningful amount of Bitcoin (or another asset that can be leveraged: Real Estate, Equities, Whole Life Insurance, etc.)

2. Has a tax liability (W-2 income, business income, capital gains, or some combination)

3. Wants to acquire more Bitcoin without selling what they have

If that describes you, keep reading.

Step 1: Borrow Against Your Bitcoin

The first move is capital deployment — without triggering a taxable event.

Selling Bitcoin to fund an investment creates a capital gains tax event. Borrowing against it does not. A Bitcoin-backed loan allows you to access liquidity while your BTC continues to appreciate.

Here is how the loan structure works in this model:

• Loan-to-Value (LTV): 33% — For every $3 of Bitcoin you hold, you can borrow $1. This conservative LTV gives significant cushion against price volatility and keeps margin call risk low.

• Interest Rate: 9% annually, accruing monthly and rolling into the loan balance, no monthly cash payments required.

• Term: 1 year, refinanced annually. The loan rolls forward each year, with accrued interest folded into the new principal.

Using the Tier 2 package as our model:

• Loan amount: $150,000

• Collateral BTC required: ~5.55 BTC

• Collateral value at origination: ~$444,000

• Starting LTV: 33%

• Annual interest rate: 9%

• Annual power cost of ~$46,000 added to loan balance each year

The $150,000 in loan proceeds funds the entire mining operation: 20 Bitcoin Miners (Antminer S21 XP, 270T), setup, and the first full year of power costs.

Step 2: Buy the Miners — and Reclaim Your Taxes

Under current IRS code, Bitcoin mining equipment qualifies as 5-year MACRS property — and it is eligible for 100% bonus depreciation in Year 1. This means you can deduct the full purchase price of the hardware from your taxable income in the year you buy it.

But the deduction does not stop at the hardware.

Electricity costs for Bitcoin mining are a deductible business expense. And there is a powerful timing strategy built into the Blockware bundle: because the first full year of power is prepaid upfront as part of the package, that entire power cost can be deducted in the same tax year as the hardware purchase — even though the electricity will be consumed over the following 12 months. This strategy, sometimes called a “prepaid expense deduction,” is well-established in tax law and allows you to pull forward a full year of operating deductions into Year 1.

The result: the entire $150,000 Tier 2 bundle is deductible in Year 1.

Here is what that looks like across different tax brackets:

At a 37% marginal rate, the government effectively hands you back $50,963 of your $150,000 investment in Year 1 alone — before a single Bitcoin has been mined. Your effective out-of-pocket cost on the bundle drops to just under $99,000.

That is not a loophole. That is the tax code working exactly as Congress designed it — to incentivize capital investment in productive assets.

Consult your CPA or tax advisor to confirm eligibility and timing of deductions in your specific situation.

There is one more piece of the tax picture to understand before moving on: the Bitcoin your miners produce is taxable as ordinary income at the time it is received, based on the fair market value of BTC on the day of receipt.

This is a real consideration. For someone in the 37% bracket receiving 0.0736 BTC per month at today’s prices, the monthly tax liability is meaningful.

However, there is a natural and entirely legal solution built right into this strategy: use a portion of your mining proceeds to purchase additional miners. Those new miners generate a new round of bonus depreciation, which offsets the ordinary income from your current mining operation. The system feeds itself.

Step 3: Produce Bitcoin Around the Clock

Once the loan funds are deployed and the paperwork is signed, Blockware takes over completely. The miners are procured, deployed to institutional-grade facilities, and brought online, typically within 2 to 3 weeks of funding.

From that point forward, Bitcoin flows to your wallet automatically, every month, with no action required on your part.

Here is what the Tier 2 production profile looks like over 4 years, incorporating two key real-world factors: annual difficulty growth of 10% (as more hashrate joins the network, each miner’s share of rewards shrinks) and the April 2028 halving, which cuts block rewards in half beginning in Year 3.

A natural question: if the halving cuts production in half, doesn’t that hurt the strategy?

It does reduce the amount of Bitcoin mined. But historically, every halving has been followed by a significant appreciation in Bitcoin’s price — because the same demand now faces half the new supply. The miners you own continue operating. The Bitcoin you have accumulated is worth more. And critically, your collateral is worth more too, which improves your LTV and borrowing capacity going forward.

The Full Picture: 4-Year Portfolio Snapshot

Now let’s put the whole machine together. This is what the Tier 2 strategy looks like as a complete portfolio at the end of Year 4, under the model’s base assumptions (20% annual BTC price growth, 10% annual difficulty increase, 9% loan rate, April 2028 halving).

Your collateral appreciated by $476,000. Your miners produced 2.264 BTC worth $375,000 at Year 4 prices. You recovered over $50,000 in taxes in Year 1 alone. And you did all of it without selling a single bitcoin.

Why This Works: The Three Engines Running Simultaneously

Most investments have one engine. This strategy has three, running in parallel:

Engine 1: Bitcoin price appreciation. Your collateral BTC grows in value over time. At 20% CAGR, 5.55 BTC grows from a $444,000 pledged value to $920,000 in four years — an increase of $476,000 on an asset you never sold.

Engine 2: Tax recapture. In Year 1, the government effectively subsidizes your investment through bonus depreciation and the power prepayment deduction. At a 37% marginal rate, you recover more than $50,000 of a $150,000 investment before the miners even turn on. That subsidy is permanent — it does not have to be repaid.

Engine 3: Continuous BTC production. Your miners run 24 hours a day, 7 days a week, 365 days a year — producing Bitcoin that flows directly to your wallet, regardless of what price does in the short term. Over 4 years, you accumulate ~2.264 BTC from mining alone.

None of these engines cannibalizes the others. They compound together.

The Tradeoffs

No strategy worth understanding is without risk. Here are the ones you should know:

Loan risk. If BTC price falls significantly, your LTV rises. A sustained price decline could trigger a margin call, requiring you to post additional collateral or repay part of the loan. The 33% starting LTV provides substantial cushion — BTC would need to fall roughly 60%+ from origination to approach a typical margin call threshold — but it is not zero risk.

Difficulty growth. If more hashrate comes online faster than modeled, BTC production per miner falls faster than projected. We model 10% annual difficulty growth, which is conservative relative to historical norms but may understate growth in a strong bull market. That being said, the widespread pivot of large, public Bitcoin miners to Ai / HPC has triggered the first ever bear market in mining difficulty (down ~15% over the past six months).

Halving impact. The April 2028 halving is baked into these projections. Production drops roughly 50% beginning in Year 3. Historically, price appreciation has compensated — but there is no guarantee that pattern repeats on the same timeline.

BTC price assumption. The 20% CAGR assumption is adjustable in the model and is not a guarantee. All projected dollar values are a function of this assumption. Lower BTC appreciation reduces returns; higher appreciation amplifies them. 20% per year over the next 4 years would yield a BTC Price of ~$165,000; that seems reasonable to us.

All that being said, the biggest risk is inaction. You must have have a plan to beat inflation, minimize taxes, and build a wealth-compounding system.

This is it.

Who This Is Built For

The Perpetual Bitcoin Machine is most powerful for someone who:

• Holds BTC already and wants to put it to work without selling

• Has $100,000 – $500,000 in annual tax liability — business income, W-2 compensation, capital gains, or some combination

• Has a 3–4 year time horizon and is not looking for a short-term trade

How to Get Started

The best way to get started is to schedule a consultation with a member of the Blockware team. It’s free. It takes 30 minutes. And it could potentially save you tens or hundreds of thousands in taxes.

Fill out the form here and a member of our team will contact you in less than 24 hours to schedule a meeting: https://www.blockwaresolutions.com/info

Get Started

We’ve spent the past 3 months diligently waiting for a few key breakout signals while Bitcoin coils up like a spring.

These signals are now flashing. You should be ready for Bitcoin to make some big moves higher during the back half of this year.

The foremost indicator is the short-term holder realized price (cost basis). This level, when flipped from resistance to support, has historically signaled the end of down markets and consolidation.

In recent history, a breakout above STH-RP in Q4 2024 & Q2 2025 were followed by BTC moving significantly higher in the following months.

Acquiring Bitcoin isn’t about a one-time purchase. It’s about building a system that allows you to accumulate Bitcoin consistently in the most capital efficient way.

Right now, Blockware has some interesting bundled mining packages available:

Hardware. Hosting. Power. All included. All tax-deductible.

This allows our clients to keep more of the bitcoin they mine; rather than being forced to sell when Bitcoin is at a 40% discount.

- Buy miners without selling existing assets
- Lower 2026 taxes
- Increase your bitcoin position
- Rinse & repeat next year

If you want to learn more about these packages and how to get started, fill out the form on this page: https://www.blockwaresolutions.com/info

Miner Revenue per TeraHash is up ~40% from the February bottom. BTC picking up momentum + large-scale miners pivoting into HPC / Ai is creating the most bullish set up imaginable for smaller to mid-sized hosted Bitcoin miners (like those with Blockware).

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What a week in Las Vegas. After spending a few days on the ground with the brightest minds in the space, one thing is abundantly clear: the “noise” is quiet. Bear markets are a touch but necessary filter; they flush out the grifters and the unprofitable fluff, leaving behind a concentrated group of builders who are actually creating value. The conversations weren’t about “number go up” hype.

The companies still standing here in 2026 are the ones doing something meaningful, and the energy on the floor felt more like a construction site than a casino.

1. The Rise of Bitcoin Finance

Bitcoin finance is maturing into a robust ecosystem. Strike announced a reduction in their lending rates, signaling that liquidity is becoming more efficient. Between the growth of STRC and the expansion of digital credit markets, we are watching the plumbing of a new financial system being laid in real-time. We’re moving away from speculative “yield” and toward sustainable, Bitcoin-backed financial services.

This products will make it far easier to “live on Bitcoin.” Mitchell Askew, Head of Blockware Intelligence, touched on this topic during one of his live panels:

2. The Great Convergence: Mining & AI

The shift in the mining sector is accelerating faster than most realize. Bitcoin Mining & Ai Data centers are merging into a singular High-Performance Computing (HPC) industry. While the mega-miners are pivoting their massive footprints to host LLMs and AI workloads, it’s creating a massive opening for medium-scale miners. As the giants move toward HPC, Blockware clients and mid-sized operators are poised to gobble up the market share they leave behind. For more on how the mining landscape is shifting, check out this panel featuring Mitchell of Blockware and representatives from the top ASIC Manufacturers:

3. Beyond HODL: Building the Perpetual Machine

One of the most packed sessions was Mark Moss’s “Perpetual Bitcoin Machine” panel. It’s clear that the community is evolving past the simplicity of “HODL.” People are finally thinking about building a lasting system that can be passed on. Moss laid out a blueprint for living off your BTC forever in a tax-efficient way effectively building a system to pass down to your children.

This isn’t “new” tech; it’s the same playbook the Cantillon billionaire class has used for centuries, but now it’s being applied to the hardest asset on earth. You don’t sell the goose; you manage the eggs.

To learn more about tax-efficient Bitcoin strategies, sign up for a free consultation with the Blockware team: http://mining.blockwaresolutions.com/consult

4. Debunking the Quantum Boogeyman

Quantum is not a thread to Bitcoin in the short or medium term. Right now, it remains entirely abstract and hypothetical. Even if a quantum computer capable of breaking ECDSA eventually emerges, Bitcoin isn’t “ruined.” Quantum-resistant solutions are already in the works. Furthermore, the risk is misunderstood; a quantum computer attacks the public-private key pair, but if you’re using fresh bc1q (SegWit) addresses for every transaction, your public key isn’t even exposed to the network until you spend.

Even “Satoshi’s coins”, the ultimate FUD target, aren’t going to be snagged by a basement hacker who them proceeds to market sell all at once on coinbase. Quantum tech will emerge from Big Tech or nation-states, entities bound by legal due process, not a random actor looking to crash the market.

Mitchell discussed this on a BitGo sponsored panel with Adam Back, Alex of Project Eleven, and Richard Carback of Postquant labs. The recording has not yet been posted but we will post it when its live.

Key Takeaway: The signal has never been higher. While the tourists left during the drawdown, the architects stayed to build the infrastructure for the next decade.

One of the most interesting products being built is Blockware’s “Rent Hash.”

Bitcoin Miners produce Bitcoin at a discount below the market price. By renting a miner you can capture a piece of that spread without having to put up the capital to purchase the machine. Effectively, this allows you to dollar-cost average at a discount.

In the rental example below, you could acquire BTC for an effective price of $74,000 per coin. How? A $1,618 rental will earn ~0.02 BTC (~$1,740 worth) over the next two months.

Click here to see the full listing of rentals: https://marketplace.blockwaresolutions.com/renthash

See the full press release here: https://www.streetinsider.com/Pinion+Newswire/MicroBT+Announces+Strategic+Investment+into+Blockware%2C+Strengthening+a+Key+Industry+Alliance/26371989.html

The Blockware Team will be at Bitcoin 2026 in Las Vegas, April 27th - April 29th. Get ready for a week full of in-depth panel discussions, happy hours, and camaraderie.

Our team will be giving away a free Antminer S21 XP. Signing up for a chance to win is simple and free. All you have to do is visit the Blockware booth.

It’s large, green, and will be in the center of the conference hall. You won’t miss it.

Come talk Bitcoin Mining and enter for a chance to win a free miner worth ~$4,500.

If you’re unable to attend the conference and would still like to learn more about Bitcoin Mining with Blockware, click here to sign up for a free 30-minute consultation with a member of our team.

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While broader sentiment has remained mostly bearish since Bitcoin dropped to ~$60,000 in early February, Bitcoin Miners have quietly recovered to pre-February levels.

Over the past two months, Bitcoin Miner Revenue per Terahash (Hashprice) is up ~30%; currently sitting at ~$0.038/Th/Day.

Steady recovery in the price of Bitcoin coupled with a flurry of downward difficulty adjustments has created the perfect environment for Bitcoin miners.

The price of Bitcoin Mining Servers (ASICs) is beginning to reflect this recovery in hashprice.

The official listed price on Bitmain’s website for Antminer S21 XPs has increased to $17/Th — up from $15/Th back in February.

The actual price of mining hardware can vary; it’s a far less liquid and fungible market than Bitcoin itself (nothing’s more liquid than Bitcoin; billions of $ of trading volume 24/7/365). Deal size, used vs new, shipping times, etc., can all impact miner prices and no two deals are identical.

That being said, the listing price from the manufacturers tends to initiate a “ripple effect”, which leads to a change in pricing across the breadth of the market.

Miner prices on the Blockware Marketplace are showing a similar trend.

S21 XPs, as recently as March, were selling for ~$13.5/Th on the platform. The lowest available listing is $17.7/Th — nearly a 30% increase.

The Blockware Marketplace is a peer-to-peer platform that allows users to buy/sell hosted miners. Often times, these units carry a “premium” relative to purchasing brand new machines. Time is money; buying a machine that is already on the rack at one of Blockware’s data centers can be more valuable than waiting 2 to 3 weeks for brand new units to arrive.

The Marketplace is great if you’re new to Bitcoin Mining and want to get your feet wet with 1 or 2 machines.

Blockware has bulk discounts available (on hardware & power costs) for clients purchasing 10 or more machines. If you’re interested in learning more about Bitcoin Mining — bonus depreciation, power costs, BTC revenue, etc. — fill out the form here: https://mining.blockwaresolutions.com/info

A member of our team will provide more information and help you determine if Bitcoin Mining makes sense for you and your financial goals.

Learn More about Bitcoin Mining

Risk is on. QE is underway. A dovish Fed chair takes office next month. Weak hands have been shaken out.

The bullish catalysts are compounding. Bitcoin likely surprises to the upside over the next 12 to 24 months.

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