REKT VISION: What Does the 2024 US Election Mean for Crypto?

0:00Make large crypto trades with crackive OTC, execute orders of more than 100 ,000 off the open exchange through our premium OTC trading trading trading trading trading, Get 24-7 access to deep liquidity, minimal slippage, and competitive execution and settlement services. Private and secure trading options include chatting securely with our trade desk for a personalized high-touch service, or use our self-service RFQ for super-fast automated OTC trading. Non-investment advice, crypto trading involves risk of loss and is offered to U.S. customers through Payward Interactive, Inc. For more information, go to realvision.com backslash kraken OTC.

0:45well hello everyone we're back for another week of wrecked vision we have osf back um firstly congratulations osf we missed you for the last couple of weeks we had sergio silver come back congratulations on the baby girl you've uh you've seemingly come back and the market's absolutely ripped like we had a couple of weeks where we were hanging out below 60k and then in the last week alone i think bitcoin is up around 12 percent eath up around 10 percent and solana's up just over 20 so a huge huge week for markets we're going to go through everything that's happened this week uh every i mean this time last week the whole trump assassination attempt hadn't even happened so it does feel like an age ago but a lot has happened in that week uh you've seen some crazy headlines coming out with regards to that and some other bullish sentiment out there on the timeline with various different things that have taken us up to this level.

1:41So maybe we'll get straight into it because I think the biggest headline was politics really this week. Politics has really become the number one mover in crypto. On the back of the Trump, well, the failed Trump assassination event, we saw Bitcoin breach 60K. And then once it breached 60K on that weekly candle, we shot all the way up to 65K pretty quickly. We've bounced around there a little bit, but generally an incredibly strong week for crypto in a week where macro has kind of not done that well. You've seen the NASDAQ has some pretty tough days, but crypto has definitely taken the shine back.

2:21What do you make of this current market? what did you make of that that rebound uh on the back of all the trump headlines yeah look i think we've touched upon the potential impact to crypto of a trump election win and you know he had that uh he mentioned it in some speech a few weeks ago about um protecting bitcoin from elizabeth warren and her goons and all that and so that information was out there but it felt like it never really got priced into the crypto markets and i don't know if that was because people were not sure he was going to follow through on the things that he said, or because people thought the 60-40 lead that he had, according to Polymarket, wasn't a big enough margin for people to price that in meaningfully.

3:07And so the main thing about the attempted assassination is obviously his odds of winning the election have skyrocketed. And the stuff around crypto now feels like more of a reality. and you also had the stuff that came out yesterday which we'll touch on um with regard to bitcoin potentially being used as a strategic reserve asset for the u.s as well so there are a few things now about this election where we have a bit we have a few more data not data points but we have a few more things to grasp on which are like quite clear positive things for crypto and with him gaining an additional 10 point lead versus where he was this time last week in the polls some of these things now seem more like a reality to me and that seems to be enough to just really make the market do a u-turn because i think for all the chart people out there um reading the the horoscopes and stuff if we had closed behind below 60k on that weekly candle the thought was that we would go you know materially low to 50s and perhaps even below so there are some pretty significant um positive catalysts that are now starting to form which are very tied to the outcome of the US elections, I think.

4:20Yeah, you're right. I think on the back of that headline or the headlines that he'd survived, you saw macro broadly rally, but that petered out by the end of the week. And what's really happened is you've seen a ratcheting up of a lot of politics coming into crypto. You saw J.D. Vance, who got, well, now nominated as the VP candidate for the Republicans, and he's been very pro-crypto. So there's been a number of speeches that were circulating earlier in his career where he was criticizing Gensler's approach to crypto pretty heavily and basically indicating that most things were not securities or that the stuff that Gensler was going after for being securities was not the stuff that we should be worried about, which I think got people very, very bullish with that appointment.

5:03And then you saw, yeah, what could only be rumors at this stage, but one of Trump's next big speeches is at Bitcoin Nashville. You know, like he had the Republican convention and the next week he's going to be speaking at Bitcoin Nashville. He's been he is being advised by the Bitcoin magazine team. In fact, the Bitcoin magazine team is meant to be hosting a fundraiser for him, I believe, at some point in the next month. and the tickets for that fundraiser are going for hundreds of thousands of dollars. I've seen around$850 ,000 is some of the tickets going for that fundraiser. He's obviously had significant crypto donors over the last few months.

5:44You saw the Winklevoss twins, for example, put in, I think, a million each, right? But there is now these headlines seeming coming out that he might look to label Bitcoin as a strategic asset, similar to what you might see from gold or you have a strategic reserve for things like oil even, which I think is just a complete game changer if they say that. What did you make of this headline? Because when I saw this, I quickly just typed in central bank gold reserves and we're talking into the trillions and I just felt like this could be a game changer. Yeah, it's a very, very big deal. It would mean so the US would own Bitcoin as a strategic reserve asset just like they may own other foreign currencies or own gold and whatnot.

6:30It's important to note that the US already owns, the US government owns 210 ,000 Bitcoin, which makes it one of the largest Bitcoin holders in the world. That totals to north of$13 billion worth of Bitcoin. So, you know, in the past, it's always been like, when is the US government going to sell their Bitcoin? You know, how is that going to impact the market? That's been a potential negative headwind for the market. I think a reclassification of those holdings as a strategic reserve asset means that supply never fully comes into the market in one go. And if you're thinking about it from a business perspective or as a trader's perspective, all Trump or all the US really has to do is start legitimizing crypto.

7:11And then suddenly this$13 billion holding they have of Bitcoin doubles or triples and they literally make billions of dollars in P &L. and they can do with that what they want and maybe they can sell something at a higher level or maybe if they announce it, the rest of the world follows and they already had a massive head start in being one of the largest holders of Bitcoin. So I think there are lots of strategic benefits to the US of doing this. The cost of the stuff we spoke about two weeks ago about feeling like the government is losing control and giving people a greater sense of self-sovereignty and all that.

7:42But it does really put the US in a very strong strategic position to announce and do something like that, particularly if other countries follow. Will he go out there and announce it is one thing. Will he go out there and actually execute it is another thing. But I don't see why not. I really don't see why not. And I think even if there's only a 5 % or 10 % chance of this happening, I don't think it's priced into Bitcoin right now because it's a hugely, hugely positive thing. Just the fact that the US potentially won't sell their$210 ,000 holding of Bitcoin and maybe even potentially buy more Bitcoin.

8:20Can you imagine a world where the US government is buying Bitcoin and you have every central bank going out there trading and buying and selling Bitcoin and stuff? You know, like it's a pretty insane thing to think about and it just makes you feel like this asset class, which is just under$3 trillion when, you know, that's lower than the market cap of NVIDIA, for example, just makes it feel so cheap. I mean, I don't know how to put it really. That was the big thing for me because we'd seen some creep into this world from, well, from Central and South American countries. Notably, El Salvador has its own Bitcoin reserve.

8:58And you'd seen some South American countries indicated they might go this way as well. But I think people thought it would be a slow creep to see other larger, let's say, G8 countries move to do this. If the U.S. does this, that's the main thing. They already have 12 billion. And that has always been a worry that they might sell it. Germany sold 3 billion, or they finished selling 3 billion last week. If they do this, I do think you'll see central banks around the world, governments around the world, announce that they might buy some. I think this would be very, very bullish just for the global acceptance of Bitcoin as digital gold.

9:38So, yeah, I don't think it's priced in. And I think this could be a very, very big bullish move for Bitcoin if it's announced next week. And, you know, I think that could take us up to close to all time highs again. This feels like we're now in this vacuum where a lot of people gave up on this asset class while tech stocks were ripping. And we headed south below 60K with all that supply potentially coming. In fact, we've completely shrugged off. we've completely shrugged off the Mt. Gox distribution, which happened earlier this week. They gave out 6 billion of Bitcoin. It hasn't yet reached a lot of customers.

10:17I think it's 7 to 14 days, but I barely see it mentioned. It really feels as though that was already priced in. And as soon as that distribution was made as well, we rallied. So it feels as though these are big, big headlines and incremental headlines over the last week, which has meant that that crypto is as massively outperformed the rest of macro. It does. It does just feel super feels really, really good. Hey, everyone. We're going to take a quick pause and hear a word from our partners. We'll be right back. Have you ever wanted to trade Bitcoin but haven't dared try? With plus 500 futures, you can trade crypto without the hassle of opening a wallet.

10:57With just a few clicks, you can register and start practicing with their free and unlimited demo. See a trading opportunity? You'll be able to trade it in just two clicks. Feel ready? you can move to real money with as little as$100 once your account is approved. And the great thing is that in addition to crypto, Plus500 gives you access to a wide range of instruments. S &P 500, NASDAQ, gas, and much more. Explore equity indices, energy, metals, Forex, and beyond. With a simple and intuitive platform, you can trade anytime, anywhere. Experience the fast, accessible futures trading you've been waiting for with Plus500.

11:31With over 20 years of experience, Plus500 is your gateway to the markets. Visit us.plus500.com to learn more. Trading in futures involves the risk of loss and is not suitable for everyone. Not all applicants will qualify. Plus 500. It's trading with a plus.

11:51It's the first time in a while, isn't it, where it feels like stocks are actually a little bit lower today and were lower yesterday, but crypto is higher. And it feels like we've had so much of the opposite. And there's still a massive catch-up trade for crypto to happen. if you're looking at it versus stocks, given the move in the last six months. But yeah, it's nice to see, at least finally for the first time, that correlation breaking down in the opposite direction where crypto is outperforming. And I think this is it. I really strongly believe this is the next part of this bull run. I think this move higher is the move that takes Bitcoin through all-time highs.

12:28I personally don't think we'll see a 20 % move lower in Bitcoin from now until it re-hits all-time highs, just because I think each incremental headline in between now and the elections is going to be a strongly positive one. And it's just a question of how those probabilities grow. And I would expect them to increase as time goes on. Yeah, it felt like we could be derailed by the amount of supply. But once the German selling was done and Mt. Gox seemingly was a kind of a no-known that people were prepared for, The only real big pocket of supply was this US, you know, 12 billion or so of Bitcoin.

13:10And if that's now potentially going to be relabeled as part of their strategic reserve, and who knows, maybe even you get FOMO buying from other central banks, other governments, then I think this could be a big game changer. So it does change the narrative of that supply overhang that we have for crypto. And we also have going into Q4, you have the FTX repayments, you know, and everyone's getting very, very bullish on that impact. So suddenly that supply demand imbalance has shifted straight back to, oh, wow, like we might not have these huge pockets of supply coming. Or at least if it's just Mt.

13:48Gox, then that might be pretty manageable. I think the other thing to mention is why politics has become far more of a big deal is what went on with the Chevron deference, which is actually a few weeks ago, but it's seemingly been making the rounds more in crypto over the last week or so, which is that the SEC seemingly has had its powers massively repealed here. The Supreme Court ruled against the Chevron ruling of 40 years ago, which basically shifts power away from three-letter agencies, including the SEC, and back towards lawmakers, which basically shifts, again, the focus back onto politics in the US.

14:27You know, it's one of the few major countries which hasn't got any new crypto regulation. And people in the crypto space have been dying for it. You've seen regulation come out of the UK, regulation come out of the EU, several Asian economies. But the US is kind of just stuck with we've got enough with our current securities regulations. now it's seemingly saying the SEC is going to be at least curtailed in their ability to act against crypto. I looked at this and said, well, politics is going to be very, very important. And suddenly you have people like J.D. Vance, you have a far more pro-crypto political agenda coming through with the Republicans.

15:09It's kind of a perfect storm again for crypto becoming more mainstream, I think, in the U.S.

15:17yeah i think um i think you have to what you know we've been in this paradigm of it feeling like the sec has had so much power over crypto and court case after court case um you know it feels like the final decision of the etf lays with them lies with them and there's been you know there's been pushes for um for it to be regulated by the cftc and taking power away from the SEC. And I think you've had multiple call-outs of how, I guess, number one, how Gary Gantz is the wrong person for the job, and number two, how they're making decisions and overstepping their boundaries in decisions that shouldn't really lie with them.

15:55So I think this ruling is an interesting one because, again, it shows you the potential change in political landscape. And that's one of the things that I think, again, is potentially bullish about, like a Trump regime for crypto, is the ousting of Gary Gensler, maybe even someone like Hester Pierce taking over the SEC, and maybe even just them having less power in just having such a tight grip on regulation over markets, which perhaps they shouldn't have. I don't know. I'm not an expert on that, but the point here is we're recognizing potential change in who has the power to make these decisions over regulation.

16:33Yeah. Regulation by enforcement is generally how crypto has been treated. And I think a lot of people are increasingly, you know, you take off your crypto expert hat and you put on your politics hat in the US. And the reason why that's becoming more important is for rulings like this. It does feel like politics is suddenly going to become more important in crypto, particularly the rules coming out of Congress. So when you start to see things like this happening, it does become a much bigger deal. And it's probably why, you know, We've seen this massive outperformance of crypto as well with more strong political support for it.

17:09So definitely a strong week. In terms of the other majors, Solana's had a massive week. Solana is back up near 170. So we're only, what, 15%, 20 % off the cycle highs there. So big, big move high there. You've got the ETF next week, it looks like. um it keeps it's been delayed a few times but um that's also hovering kind of 3 500 areas still still a good performance interestingly this week you saw all the different funds come out and give out their fee structure and everyone kind of came in around the 0.2 to 0.25 range and what you did see is that Grayscale, they did two things. They kept a 2.5 % fee on their main ETH trust.

18:04And then they've also brought out this mini trust with a 0.15 % fee, which is meant to kind of help the stem of outflows. What do you make of this? Because I looked at this at first glance, and although Cicel's a huge ETH bull, this got some very mixed responses because it feels as though Grayscale have just said, we don't care. We might lose AUM again. And what happened last time, the reason why this is important for viewers is last time this happened with the Bitcoin ETFs, as soon as they were announced or they went live trading, you saw huge outflows coming out of Grayscale and Bitcoin dropped like 20, 25%.

18:39It was a big move. What do you think happens here with Eve? Do you think this is all no known now and you don't have to worry or do you think this is this is dumb i personally think it's something that's not to worry about i think a 2.5 fee is obviously by design grayscale's mini etf will have a 0.2 fee which puts it in the middle of the road doesn't put it as the cheapest um as the cheapest one i think the lowest fee that i've seen is maybe 0.15 so they know they're gonna lose um they're gonna lose uh investors or you know however you want to put it. But the big question is not really what happens to, with regard to Grayscale outflows, it's what happens to the net flow.

19:25And I think when we saw those headline numbers of Bitcoin, remember like people had this massive basis trade on in Bitcoin where they owned the Grayscale ETF as being short Bitcoin futures because there was a huge discount in that, which eventually closed completely after the ETFs were approved and they were just like, cool, we're just going to monetize this trade. and we're going to cover the futures and sell GBTC on the other side. So I think that trade also exists on ETH as well, in ETHE versus Ether futures. But I don't think it was anywhere near the size that you saw on Bitcoin. And I don't think the discount got as large as it did on Bitcoin either.

20:06So that trade in itself is smaller than it was on Bitcoin, in my belief. And on top of that, again, as I said, it's about net flow. So if someone's like, cool, I don't really want to pay 2.5%, but I still want to be long ETH, where do I go? Well, I can go to the Grayscale mini ETF, or I can go to Fidelity or BlackRock or whatever it is and just pay a lower fee. And that's the thing we need to really keep an eye on, like what the net flow is at the end of each day and not just what the ETHE, which is Grayscale's ETH ETF, not just the output number on that, basically. Hey, everyone. We're going to take another quick break and hear a word from our partners, and then we'll be right back.

20:52Yeah, I think you're going to see decent inflows. I think you're going to see decent inflows because of the basis trade too. I think people are going to pile in and do the same basis trade they were doing on Bitcoin, and they're going to do it on ETH. So I think this is probably no known at this stage. If I'm honest, though, I'm still just more bullish on Salamana. Like, I feel like this is the number one thing that everyone's focused on on ETH. And Larry Fink did go on CNBC. And once you get someone like talking about Bitcoin this week and he was super bullish and everyone in crypto got bullish about it too, there are going to be people that go on CNBC and Bloomberg and get very, very bullish on ETH.

21:31And it's good to have more and more proponents of it. But I don't know. Like when you see Solana outperform ETH this much the week before the ETF, i feel as though this is this is defining eth for a little bit here and although i own all three like i'm not i'm not sitting here and i don't think eth is going to 5 000 um but i think i think solana could keep on going so out of those three bags um i think i'm not bearish i think you're going to see decent inflows i think this this is what's going to define eth though for the for the medium term and i don't think i don't think they're going to knock it out the pot is basically what i'm saying i think i think it's going to be slow and steady i think we're going to we're probably going to hit in the mid single digits of um of billion inflows but i don't know if that takes me to like crazy figures it's pretty interesting to see the price of sole eth the ratio of slant ETH ever since the ETH ETF got approved and it's pretty much up only like I think Sol ETH has moved from like 0.038 to 0.048 so I think Solana's outperformed ETH by something like 30-35 % since the ETH ETF got approved which is interesting it tells you in my opinion the reason for that is I just think Sol is a higher beta thing than ETH and I think crypto overall is going higher from here and an ectf is bullish for crypto overall i think that's the main reason but um you know it makes you wonder is is solano better play because if if there's a lot of eth money which i think it's like oh should i be in seoul and if the ectf disappoints i think you would see a lot of people throwing in the towel and moving to seoul based on that but it's you can't call a disappointment or a success you can't call it disappointment or success in the first day or two because bitcoin was the same thing right the flows weren't great at the beginning and then you just had monster inflows um day after day after day so it's going to be a hard one to judge an interesting one to watch i think yeah look i might be mid-curving it because you know bitcoin outperformed most altcoins this cycle and that's just because it had consistent inflows my guess is just i don't think you see an extreme either way i don't think it disappoints overly but i don't think it they knock it out the park i think you just see like okay levels of inflows but which would still be massive probably the second most successful etf ever you know in terms of uh getting infos in but for me i just yeah that chart that chart for me is is is kind of up only this cycle with with the the fees that solana's generating and the activity that's going on there is it's out of those majors i just get i just i always get drawn back to it even though i own all three where do you think it goes i'm just looking at now on my on my screen it's probably like about 25 off all-time highs the ratio of salt to eth which yeah look earlier this year it's a little bit difficult because solana is obviously it's emissions are much higher you You know, like this is an asset which inflates at like 67 % a year versus ETH, which is kind of at 1 % to 2 % right now.

24:58But at the same time, the fees generated on Solana, or at least the total economic value, is now comparable to ETH. In fact, it's flipped ETH several times. And it's now, it's still about a fifth to a sixth of the price, right? So I think Solana could double. and pretty constantly like it could double and i don't even think i would worry about the price of eve i think that the you know it could you could you could get very bullish on what i think solana's market value could be here but i do think at the end of the day inflation matters and i do think that will you know one thing that in this experiment of cryptocurrency has proven is that if you want something to be like money you kind of do need that rate of inflation to keep the wheels of society going in my opinion that's what keeps your fees low that's what keeps it fast um if you want it to be like gold then you want it to be like bitcoin and have like a fixed rate of supply but eth is kind of caught in between of trying to be both and i feel like it's probably done a bad job of both at the moment like it's at least not an optimal job of both so when you say like why do you want to own eith it's no longer um you know deflating and it's not got that that pace um that throughput of of um that you need for like a money which seemingly as we're testing out different ways to speed run a currency it feels like you kind of need that that levels of inflation at least at the start to keep the like the grease on the wheels so to speak and And what you end up with ETH is kind of a slow, expensive chain, which gets 1 % to 2 % of inflation.

26:44So part of that's architecture differences, but part of that is just, I think, the way that the chain, for it to be cheap and fast, the validators have got to be paid. So, yeah, that's just the way I kind of view it. But, yeah, I think you can be bullish on all three. I think you can start to think about, if Bitcoin gets called a strategic asset here, I think you could see 100K before the end of the year. Yeah, easily. So I feel like you're betting on the fastest force in a race where they're all going to finish in the top three. We're in for a very, very bullish period here for crypto. So I don't think you need to necessarily get too caught up in which horse to back.

27:32But of those three, it's definitely Solana right now. We did get some other news out on this week, which is that Grayscale, we're going to launch another fund. This is their AI fund, which they called it a decentralized AI fund. And they had a hodgepodge of different AI coins in there. Some of them were kind of more Deepin-esque rather than AI. but it just flicked a switch in my head particularly with you know um with i think going on cnbc and saying being so bullish on crypto that we could now see like a huge explosion of tradfi going into crypto what did you make of the that fund and and these headlines yeah it just it just has to happen doesn't it it just has to happen um i think blackrock having a tokenized fund and grayscale launching this fund um you know and grayscale obviously have been involved in the past with bitcoin eth etc i think there's even a solana trust or something like that right um with grayscale but having um like a an ai fund it gives it very much uh the vibe of one of these mixed ets which which you know i don't know like a retail etf for example which has a bunch of retail companies and it does start to give you these are like very like traditional finance investable products that people want to own if they want to get exposed to something and um it just feels like this is going to be the start of it you know it's not you have to remember like these products the reason why these guys want to have these products is number one they can charge a ton of fees on them the fees they're charging on on these crypto etfs are materially higher than the fees they make on regular way ets and number two is if it's just if they have the demand for it and anecdotally and you're probably the same thing you just meet a ton of people who want some exposure to crypto and it but they just don't want to make a wallet they don't want to you know explain to them how to buy something on chain it's like oh well you need to install metamask they need to write down your seed phase on a piece of paper then you need to i need to go through that whole thing you know everyone's had this argument before so the reason why it's such a big opportunity for Tradify to get in is because there is a huge amount of demand for it.

29:52It doesn't really exist right now. And they can charge a huge amount of fees on it and they can make a ton of money. And I think the success of Bitcoin ETF has shown you that's sort of like the proof of concept, if you like, and it's worked. And now I think you'll start to see them branch out into other things and other funds. And it's just a way for people to get exposure to crypto without directly having to buy crypto. And it's such a volatile asset that some people who maybe want some exposure to it in their PA don't want to be the ones trading it. Maybe you're an ultra high net worth individual and you're like, I need some crypto in my PA, but I don't want to be the person deciding, do I buy ETH?

30:32Do I buy Bitcoin? Do I buy which AI coin do I buy? What do these all mean? You just want to put it into a fund where you trust someone to do it all for you and pay the management fee. I do believe there is demand for that and I think we're just going to see more and more of this you obviously need a strong crypto market to continue and stay resilient for a good amount of time if you have what happened in 2022 with FTX etc definitely shakes confidence and stifles potential investment into the space so you need a good clean run which hopefully we get but it's also crypto so you never know but it's hard for me to see this tradfire adoption of it not continue and i think we're going to see that um adoption accelerate um in this post etf era yeah this gets me bullish on altcoins because this this market is built for etfs you know etfs help bridge that gap between uh investors that don't particularly know about the end markets or the end stock market, for example, or the individual single stocks in them or individual assets in them, but want to have exposure to them.

31:40You used to see this even in our market, in like the high yield market. If you wanted to have some exposure to high yield bonds, but you didn't really want to go through and do due diligence on every single bond, you might buy the high yield bond ETF. If you wanted to have exposure to South Korean equities, you might buy the South Korea ETF. And that's a prime example. If you don't really know the coins or the stocks behind it, but you want to get some exposure. I think we're going to see the ECF industry go crazy on this space, particularly for old coins. Because if I want to pick out a meme coin index, maybe that's what I want to have.

32:14If I want to get some exposure to decentralized AI coins, maybe that's what I want to do. L1 coins, D-Pin, all these sectors in crypto, which are difficult to invest in sometimes for the average user, but they know they want to have exposure to, I think you're going to see more and more of this. And I think this is the way that BlackRock will go. If you start to see what we've just seen with the comments by J.D. Vance or by Trump, where you get a much more pro-crypto agenda coming out of Congress, where a lot of these things don't have to be called securities, I think this is what you're going to see.