Mad Hedge Bitcoin Letter
December 30, 2021
Fiat Lux
Featured Trade:
(CRYPTO PASSIVE INCOME THE RIGHT WAY)
(CELSIUS NETWORK), (BTC), (ETH), (SNX), (CEL), (LINK), (UNI), (AAVE)
Mad Hedge Bitcoin Letter
December 30, 2021
Fiat Lux
Featured Trade:
(CRYPTO PASSIVE INCOME THE RIGHT WAY)
(CELSIUS NETWORK), (BTC), (ETH), (SNX), (CEL), (LINK), (UNI), (AAVE)
So global yields are in the toilet today?
Savings accounts don’t do what they used to do, do they?
How about we try out a certificate of deposit (CD) to harvest some cash?
Are there simply no other interest-bearing vehicles one can park capital in and gain a healthy return?
I would say you are right, but then I would be the fool here and I am certainly not in that line of work.
I will tell you — there is an elixir to the anathema!
Enter Celsius.
Celsius is a crypto-based financial service hoping to disrupt traditional financial services.
They offer cryptocurrency savings accounts that yield high annual interest rates up to 17% annually. They do this by lending cryptocurrency out to institutional and retail traders who seek to leverage their positions.
Since these platforms require collateral to receive a loan, investors can be sure that the loan will be paid back one way or another.
While these rates are floating interest rates, meaning they can change with the market, they’re relatively stable month-over-month.
These loans are over-collateralized, which means the risk of default is lower than it would be for a standard loan. To this day there has never been a default for any coin on this specific cryptocurrency lending platform.
How Do Celsius Make Money?
Celsius primarily generates revenue through its crypto lending service. The company lends assets to users at a higher interest rate than it pays them for storing their assets on the platform.
Celsius has more cryptocurrencies available for interest-bearing accounts, including BTC, ETH, SNX, CEL, LINK, UNI, and AAVE to name a few.
Payouts and Withdrawals
Celsius users can withdraw their funds at any time without incurring additional fees. Those who wish to withdraw over $50,000 with a single transaction need to wait 24 to 48 hours for it to process. The company makes its weekly interest payments on Mondays.
Let the compound interest payments pile up all while exposed to minimal market risk.
Celsius confirms its holdings of $20,366,621,718 in cryptocurrency assets as of August 13, 2021.
In less than one year, Celsius has grown its total asset holdings from $1 billion to over $20 billion.
Do you want to be part of this 20X growth story?
As part of its Proof of Community (POC) and rewards explorer, Celsius provides real-time data about its assets, loans, users, and rewards paid.
This asset growth trajectory is parabolic with Celsius confirming it is adding close to $1B a month in new assets, as the company trends towards the number one position in total asset holdings in the crypto industry.
For years the traditional banking business has conditioned us naïve folk to accept steep fees and no yield earnings on holdings as the status quo.
I will tell you right now that it’s a load of garbage and nobody should accept these pitiful offers from dinosaur banks.
There is so much more out there that we can access now because of crypto.
With that failing model ripe for disruption, Celsius was built to give consumers what banks never could — a community-oriented platform that provides income and financial independence and it delivers it with a bang.
At the start, Celsius had set a goal to bring the next 100 million people into crypto. Today, they have over 950,000 users worldwide.
Celsius has even just launched its crypto-backed lending service in California following regulatory approval.
The California expansion enables the firm to enlarge its footprint in one of the fintech capitals of the world — California.
The firm claims that it now is "one of the most accessible and affordable lenders in California."
The loans can be issued in both United States dollars and stable coins, the minimum loan value is $500, the process is instant, does not need proof of income or credit check.
You are not dreaming — this is the real deal.
Wake up to fresh crypto interest payment receivables on Monday morning easily convertible into fiat currency.
Participate in one of the most unique crypto deals in the world.
To check out this deal of a lifetime, click here to visit their website.
Mad Hedge Bitcoin Letter
December 28, 2021
Fiat Lux
Featured Trade:
(THE ART OF BITCOIN MINING)
(BTC), (ASIC), (GPU)
What Is Bitcoin Mining?
Bitcoin mining is the way in which new coins are added to the existing supply of the cryptocurrency known as Bitcoin (BTC).
These transactions are confirmed by the network and represent a critical component of the maintenance and development of the blockchain ledger.
Cryptocurrency mining is attractive to many investors interested in cryptocurrency and the most profitable are able to do it on a large scale incorporating an industrial mindset.
How Do I Mine Bitcoin?
Mining Bitcoin is not for the faint of heart.
Your computer must solve complicated math problems that verify transactions in the currency.
When a bitcoin is successfully mined — the miner receives a bitcoin.
One can use a normal computer that has a CPU, motherboard, RAM, and storage to mine bitcoin.
The only difference and the most important requirement here is the graphics processing unit (GPU) or the video card.
A high-performance GPU is a must if a person wants to mine Bitcoin.
Bitcoin mining is done using hardware called ASICs that is short for Application-Specific Integrated Circuits.
Another obligatory requirement is electricity for mining machines.
The largest bitcoin miners are usually found in countries with low-cost electricity.
Miners need robust infrastructure to mine mainly energy and equipment.
How do I do it at home?
A company called Compass Mining is betting that individuals will want to partake in bitcoin mining.
There’s a lucrative payout — if you’re lucky enough to mine a coin.
But the hassle of operating a mining rig can certainly cut into profits.
Compass’ new retail program will allow the purchase of a single application-specific integrated circuit (ASIC) mining rig that they can set up at home.
Mining corporations usually buy in bulk — this finally gives the little guy a chance.
Brands include top-of-the-line ASICs WhatsMiner series from MicroBT and the Antminer series from Bitmain, offering 78 to 95 Tera hashes per second and ranging in price from $8,100 to $10,400.
Profitability calculators can help you estimate your potential ROI.
Rigs are noisy and hot so it’s not for everyone.
Potential miners really need to do their due diligence if they want that sort of environment in their house.
About the size of a desktop computer tower, they can emit between 50 and 75 decibels of noise, which is roughly the same level as a vacuum cleaner or a hairdryer.
Just like the work-from-home paradigm was borne out of the pandemic, many who want to mine bitcoin, wish to do it from the confines of their couch and man cave.
The demand for mining hosting sites in North America has been outstripping supply. Encouraging bitcoin enthusiasts to set up their own operations at home is one way to relieve the pressure on existing hosting infrastructures.
China has now initiated a blanket ban on cryptocurrencies opening up opportunities for alternative miners before these Chinese mining operations relocate abroad.
The crackdown nearly halved the mining difficulty for the entire Bitcoin network. Miners outside China have been able to mine more bitcoin given the record low mining difficulty, raking in high revenue.
Corporate self-mining companies, such as Marathon and Riot, as well as third-party hosting sites, are facing a shortage in infrastructure to support more mining operations.
Higher bitcoin prices also mean more incentives for potential miners to flood this industry.
If Compass doesn’t seem right for you, then buying mining machines either from Chinese miners or from mining machine manufacturers through e-commerce platforms such as Alibaba and eBay could be a great option.
Individual mining rigs from Compass are expected to deliver within two to three weeks.
Mad Hedge Bitcoin Letter
December 23, 2021
Fiat Lux
Featured Trade:
(HOW TO SET UP A CRYPTO TRADING ACCOUNT)
(BTC), (COIN)
Mad Hedge Bitcoin Letter
December 16, 2021
Fiat Lux
Featured Trade:
(ANOTHER WAVE OF CRYPTO ADOPTION IS COMING)
(BTC)
Wall Street is finally getting the message.
On the horizon is crypto becoming an investment-grade quality asset and many hedge funds and private equity funds aren’t risking missing the boat.
This translates into more attention given to digital assets from institutional managers than ever before.
Around 35% of hedge fund managers believe that crypto in one form or another is the “can’t miss” asset of the next 10 years.
This is a seismic shift in the attitude of privately managed funds, and it was only last year that crypto was deemed an “asset of interest.”
But with many things in life, people become conditioned and 2021 will prove to the mainstream that this asset is not going anywhere.
What can you expect from now on?
The unadulterated “professionalization” of crypto through and through.
The expertization of the cryptocurrency ecosystem will translate into a more robust infrastructure that will offer many types of new exchanges and DeFi technologies that will segue us into the internet 3.0 or better known as the metaverse.
We are still quite far from being a “traditional” asset, but every little bit helps.
There will also be widespread encouragement at the Federal and State level for a clearer understanding of how crypto will be regulated.
There is still a great deal of confusion, and I am not only talking about Congress whose members hardly understand what the digital gold is about.
But I can say with conviction that we are resolving bottlenecks and it’s true we won’t get fully scaled mainstream adoption next year, but at the conversational level, many are looking out for the next opportunity.
Whether they will jump into it guns blazing is the next issue we will need to consider.
This all stems from investors hoping to participate in the “first mover” effect which is often the path from rags to riches.
Many institutions are now forming new crypto divisions inside the money funds they manage.
Last year, Tudor Investment Corp. founder and Chief Investment Officer Paul Tudor Jones gained the attention of crypto enthusiasts after arguing in an investor memo that bitcoin can serve as an inflation hedge.
Access to digital custody solutions has been a catalyst to manager interest in crypto.
Internal control reports from these custodians, assessments that have been evaluated by independent parties, have helped firms better weigh regulatory, business, and other risks associated with crypto assets.
New regulations will create another wave of institutional money into crypto as a group of managers are on the fence and waiting for the next level of clarity.
The right regulatory framework would allow for even more investment opportunities.
In general, large institutional managers are the most geared towards crypto investments which I would classify as funds with over $10 billion.
There still is much headway to make as around 15% of hedge fund managers have allocated towards crypto and about 10% of private equity funds.
Of these funds that have participated in crypto, it’s highly common to see only 1-5% of their capital invested in the crypto space.
Naturally, this will grow as crypto starts to pose a more attractive financial profile than stocks or fixed income.
Among management firms detailing plans to participate in crypto, nearly half said they would invest directly into cryptocurrencies, and half expect to allocate to crypto derivatives.
Ultimately, the potential return on capital is the driving force behind the desire for institutional money diving into this newly established asset.
The maturation phase will continue into 2022 and missing out on this industry is a suicide mission for private money and these managers know that.
Mad Hedge Bitcoin Letter
December 14, 2021
Fiat Lux
Featured Trade:
(CRYPTO IS RESTING)
(BTC)
The more speculative assets won’t be able to reverse themselves in the short-term as the Fed has singlehandedly crashed the Santa Claus rally that was on the verge of breaking out at the beginning of the month.
Meme stocks, technology growth stocks, and yes, Bitcoin (BTC) have been main participants of the repricing occurring in the risk markets as we condition ourselves to a new narrative of rising rates.
Moving up the timeline of rate rises has in effect, crushed the performance of cryptocurrencies and the inflationary headlines have become worse in the past week.
This time is important because we will be able to understand how cryptocurrency behaves during a tightening cycle, and there isn’t much recent historical data to compare.
The last time the Federal Reserve initiated a path of tightening monetary policy, following a period of easing, in 2015, the price of Bitcoin was $465, or about a hundredth of its current price.
Disappointingly, Bitcoin hasn’t been the haven for investors in times of risk-off trading, boding ill for the short-term projection of higher Bitcoin prices.
It looks that we will need more time to drag out these hawkish headlines that will suppress the price of crypto before we go higher again.
Today did nothing to help Bitcoin with wholesale prices spiking 9.6% from a year ago, the highest level going back to November 2010.
Bitcoin’s place within financial markets has still not been fully decoded, but how it reacts in the coming days is likely to tell us much more.
As a reminder, the Fed Funds Rate is the rate that banks charge each other to borrow “reserves” overnight, and it is currently 0% – 0.25%.
In the 1970s, it took bold political maneuvering to endure that much economic damage when the Federal Reserve attempted to choke off inflation by repeatedly raising the Fed funds rate until it hit 21%.
It won’t be possible for the Fed to raise rates that fast or that much without triggering an economic recession.
In mid-June, the Fed talked about the possibility of raising rates almost 2 years from now, and stocks corrected.
The truth is that our debt servicing responsibilities are so onerous that the Fed is trapped in a corner.
Total Federal Debt is about $28 trillion and growing, while State and Municipal debt is approaching $4 trillion.
The interest paid by the Fed for its debt this year will be just under $400 billion.
If rates returned to levels not seen in the 1990s, the Federal government will not be able to service the debt and will need to claim bankruptcy which would be the event of a lifetime forcing an avalanche of capital into Bitcoin.
There is about $11 trillion of corporate debt in the U.S., and this may be the biggest headache of all.
The heavy reliance on cheap capital and government help means that over 600 zombie firms aren’t growing but exist to payout employees and shareholders.
Investors know this too and that is why stocks drop every time the mere mention of higher rates surfaces in the press.
The Fed is most likely to find excuses as to why 2022 is not actually the ideal time for rapid interest rate rises but we will get the minimal rises required for the Fed to save face.
My overarching point is that Bitcoin will need to go through a sideways correction for speculative assets to absorb these 180-degree pivots in monetary policy.
The hawkish pivot is still playing itself out and we have had to minimize our trading portfolio with December looking like a washout.
I believe we must continue down the path of a Japanization to protect the health of the US economy. This will almost certainly contain bedrock policies as continued low rates, anemic growth, and massive government intervention.
These trends will underpin the rising price of crypto.
Hyperinflation is great for the price of Bitcoin, but when the Fed looks seriously about killing it, the crypto market gets spooked.
This will pass through.
Mad Hedge Bitcoin Letter
December 9, 2021
Fiat Lux
Featured Trade:
(CRYPTO REGULATION IS FAR AWAY)
(BTC),
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