Blockware Intelligence Newsletter: Week 126
Bitcoin on-chain analysis, mining analysis, macro analysis; overview of 3/23/24 - 3/29/24
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1. Bitcoin above $70,000
After a slight dip, BTC is back above its previous all-time high, currently sitting around $70,700 per coin. We are currently a ~42% move way from hitting $100 per coin. For perspective, BTC is already up 67% since January 1st.
$100k may be closer than it appears.
2. Bitcoin ETF Flows:
Inflows into the spot Bitcoin ETFs have flipped back into the green this week, with total flows Monday - Thursday amounting to ~$860 million (or ~12,600 BTC). Not coincidentally, the price of BTC has rebounded from last week’s valley.
Source: https://heyapollo.com/bitcoin-etf
3. Grayscale Bitcoin Outflows:
GBTC outflows, while still present, paled in comparison to the outflows of the previous week. Total outflows from GBTC this week more or less were equal to the total inflows into the other spot ETFs.
4. Sam Bankman-Fried:
SBF was sentenced to 25 years in the clink!
This officially closes the books on the FTX chapter of the Bitcoin/Crypto industry. The precedent has been set that digital assets do not constitute a Wild West of scams and thievery. If you steal from people to the tune of billions of dollars, you will be prosecuted.
This entire saga serves as an excellent case study into the fact that Bitcoin survives everything. In the long run, those running paper-Bitcoin schemes, such as FTX, are doomed to implode. Within a week of rumors about FTX’s insolvency, their entire operation collapsed completely. As soon as they went bust, the price reached a bottom and has since been up only. Moreover, convicted Bitcoiners were able to acquire low-priced sats and move them to self-custody.
Everything is good for Bitcoin.
5. Google Bitcoin:
The number one search engine in the world has turned itself into a Bitcoin blockchain explorer; indexing data on public Bitcoin addresses. Some people are concerned about the privacy implications, but such a development was inevitable. Bitcoin is a transparent, public ledger.
Integration of Bitcoin into big tech software is how we reach mass adoption. Under a Bitcoin standard, Facebook, Apple, Amazon, Google, X, etc., will all have Bitcoin integration to some degree. We are still in the “gradually” phase of “gradually, then suddenly.”
General Market Update
6. Nasdaq 100:
This was a relatively uneventful week in terms of macroeconomic developments. For the first time in a long time, it feels as if there’s not going to be any curveballs in the foreseeable future. Powell has effectively conceded to multiple rate cuts in the latter half of 2024 and annual Federal Budget deficits continue to operate in the trillions of dollars range. The recession and bear market that many analysts eagerly anticipated for the past two years appears to have been printed away through fiscal dominance. Now, we’re headed towards a total risk-on environment.
The Nasdaq made a new all-time high at the end of last week. It has since pulled back, but the broader up-trend is more than in-tact.
7. S&P 500:
The S&P 500 index is also at all-time highs; demonstrating the resilience of markets throughout this higher interest rate environment. While it’s cool that major US stock indices are up, their performance, pales in comparison to that of Bitcoin. Bitcoin is the horse that wins in rising liquidity environments.
Bitcoin On-Chain / Derivatives
8. Short-Term Holder Realized Price:
Short-term holder price (support during bull markets) continues to rise. The impeccability of this on-chain metric as a support level during the 2017 & 2021 bull markets means we’ll have to keep an eye on it. With the current status quo, a re-test of this level could mark a local bottom for BTC.
9. ETH / BTC:
Following the approval of the spot Bitcoin ETF, Ethereum had a brief rally as some investors shifted their sights on the possibility of an Ethereum spot ETF. However, the perineal downtrend of ETH/BTC since Ethereum switched to proof of stake in 2022 has since resumed. ETH/BTC is now retesting its yearly low level of ~.05. If this level gives, ETH/BTC will likely go into free fall. At this point, it seems to only be a matter of time. BTC is attracting significant capital from Wall Street investors, and simultaneously, altcoiners are shifting their focus to other chains, as they always have historically.
Bitcoin Mining
10. 3 Weeks Until Halving:
The 2024 halving is so close you can smell it. After this week’s ~1% negative difficulty adjustment, only 1 more adjustment remains prior to halving.
The most competitive industry in the world, Bitcoin mining, is going to become twice as competitive at block 840,000. The hardest money in the world will become twice as hard at block 840,000.
This is also Wall Street’s first halving. Don’t be surprised if this event spurs a surge in demand as it brings the absolute scarcity of Bitcoin to the forefront of investors’ minds.
11. Antminer S21 Pro
Bitmain announced the specs for their latest ASIC, the S21 Pro.
Coming in at 234 TH/s & 15 W/Th, this is an absolute beast of a machine. Boasting an impressive ~16% increase in energy efficiency compared to its predecessor, the S21.
With machines like this coming to the market, as well as the halving around the corner, it has never been more prudent for miners to upgrade to the latest-generation hardware. Barring a parabolic move in the Bitcoin price (which is certainly not out of the picture), miners will need the most efficient hardware available in order to remain competitive.
12. Marathon Block:
On Tuesday morning, Marathon ($MARA) mined a block in which they configured the order of transactions based on their fee rate. Doing so generated an image of their logo when using the popular blockchain explorer mempool.space. This garnered the attention of many, with some people responding abrasively. This was a success for them as the stunt was without a doubt designed to increase brand awareness.
It’s important to note, this block has nothing to do with ordinals or BRC-20 tokens. In fact, the logo did not show on other block explorers; just mempool. Mempool has since altered its code so that the logo does not show.
Hats off to Marathon for this clever form of advertising.
13. Energy Gravity: At a typical hosting rate today, new-gen Bitcoin ASICs require ~$27,314 worth of energy to produce 1 BTC.
All content is for informational purposes only. This Blockware Intelligence Newsletter 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.