Are We There Yet?
I'm Not Sure If the Crypto Markets Have Bottomed Yet, but Get Educated in the Meantime
Happy sunny Sunday, everyone!
(Since it’s sunny in New York, it’s obviously sunny everywhere, even if it's nighttime where you live.)
In this edition of the newsletter, I’ll touch on whether we’re near the bottom in crypto markets, explain what a smart contract is, bring you up to speed on the LUNA drama, and share some wisdom that I obtained from Justin Rhedrick’s From Bars to Bitcoin.
Here we go.
Are we there yet?
If you are wondering whether or not crypto prices have bottomed out, I offered some of my thoughts on this topic to The Street here. Below is an excerpt from what I shared:
"The mainstream media has been publishing its fair share of “we-told-you-crypto-is-a-scam” type articles and YouTube views for most crypto influencers are down 80-90%," Corva said. "These indicators are often a sign that crypto markets are somewhere near the bottom."
I recommend reading the entire piece.
Bonus thought: Bear markets in crypto are good in that they tend to drive out the scammers and degenerate speculators. In doing so, capital gets reallocated to projects that truly have legs.
While bear markets can be disheartening, especially if you’re new to these markets, these downtrends are a necessary part of crypto cycles, and they are a reminder not to invest more than you are willing to lose.
What is a smart contract?
As I’ve said many times, bear markets are a good time to get educated. Usually, it’s hard to do so when a bull market is in full swing because of all of that “I’m rich, biatch!” adrenaline sloshing around in your system.
So, if you are new to crypto and have come across this term “smart contract” but don’t know what it means, take a few minutes to educate yourself by reading a piece I wrote in which I define the term here. Below is an excerpt from the piece:
“A smart contract is a set of code that enables a specific service without needing to interact with a human.
An electronic vending machine is the simplest real-world example of an entity that uses smart contract technology. If you insert money into a vending machine and select an item from the machine’s keypad, then the machine dispenses the selected item.
Smart contracts operate on this if-then principle. If certain conditions are met within the rules set in code, then an item or service is provided.”
An update on the LUNA saga
If you’d like an update on LUNA, I wrote a piece on it here. Below is an excerpt from the piece:
“After the dust from the collapse settled, the Terra community voted to launch a new LUNA chain — LUNA 2.0 — and to airdrop these new LUNA tokens to many of the former and present holders of the old LUNA tokens and UST tokens.
On Saturday, May 28, 2022, the new chain launched and LUNA and UST token holders received a portion of their new LUNA tokens. The rest of the new LUNA tokens will be distributed over the next two to four years.”
Bonus thought: Since most exchanges have delisted $LUNA and $LUNC, selling either of these two assets can be difficult. I recently found a way to sell the airdropped $LUNA I received last week (I don’t want anything to do with the new LUNA chain and plan to continue to sell all $LUNA that gets airdropped to me.)
If you have a Keplr Wallet and use the Osmosis ecosystem, you can sell your LUNA for a token in the Cosmos ecosystem via this site. I recently sold mine for some $ATOM.
I’m not recommending you do the same, though, because I’m not a financial advisor, and this isn’t financial advice.
Wisdom from Justin Rhedrick’s From Bars to Bitcoin
I’m not even gonna play… I like making TikTok videos, and I really like how Finder’s video editor cuts and produces them. You’re the man, Ezra.
Here’s one of my latest Tikky Tokkies:
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To learn more about Bitcoin from Rhedrick, you can follow him on Twitter at @bitcoin_vegan.
Before I go
For whatever it’s worth to you, I don’t think we slide into a recession or depression just yet. I don’t believe the Fed is really going to try to roll $1.1 million off of its balance sheet per minute for any sort of extended period of time.
I still believe in some level of a “melt-up” before a crash and subsequent depression commences.
To put this in other words, essentially, I am willing to play a game of chicken with the Fed. I don’t recommend that you do, though, if a melt-up isn’t a part of your investment thesis.
While these times of great uncertainty can be great opportunities, I don’t recommend your doing anything that causes you to lose sleep at night. Safety first.
Homework
If you dabble in the world of investing and aren’t familiar with the work of financial analyst Lyn Alden, then, in the words of the great 50 Cent, “You a wanksta.” Or maybe be you just suffer from broken brain syndrome. I don’t know, and I can’t relate, because I’m neither a doctor, nor a wanksta. But I am here to help. So, please, listen to the following episode of the What Bitcoin Did podcast, and thank me later.
And, with that, I bid you adieu. Enjoy what’s left of your weekend, and have a great week!
Best,
Frank
Twitter: @frankcorva
Currently Listening To:
(Yes, I know, I spelled Warren Buffett’s last name wrong and I should I have put a hashtag in front of the word “cash” the first time I mentioned it. I’m not perfect! Leave me alone! Ahhhhhhhhhhhhhhhhh…)