As you know from my weekly newsletter, I hold a reasonable part of my portfolio in Ether. Earlier this week, ETH broke through its all time highs and appears set to breach $5k any day now.
There are many reasons for this. Reasons which I have illuminated on the numerous videos I have done on Ethereum over the past year. However, I can confidently say that I am just as bullish today as I was then.
Factors like utility demand in DeFi and NFTs is leading to a mad rush for block space. Reduced supply from fee burns is making it a rare asset. The looming PoS Merge could supercharge these fee burns and bring sustained deflation.
This of course is not going unnoticed. Investment demand is picking up as whales & institutions are stacking and staking ETH at record levels. And, according to the latest research and reports from some of the investment banks, this trend is only likely to continue.
I cover all of this in my latest Ethereum update video. I also delve into some of the most exciting price predictions and analysis that I have seen to date. This is not a video you want to miss. You can watch it here!
📊 Portfolio Update 📊
No changes to the portfolio this week guys. However, on Tuesday I did claim some ENS from the airdrop which occurred the day before (more on that below). It’s quite a small % so it’s not included in the breakdown.
There are a few tokens / coins that are on my radar which I may include in the coming week. As always, I will keep you updated on this in my Telegram Channel.
ETH 26.42% | BTC 21.01% | SOL 13.57% | DOT 10.89% | USDC 4.95% | HNT 3.60% | RUNE 3.11% | UST 2.83% | ATOM 2.69% | ADA 2.41% | PAXG 2.30% | INJ 1.58% | FTM 1.46% | AR 1.29% | LINK 1.09% | MATIC 0.78%
📈 Thoughts on Market 📈
It’s been a bit of a mixed week in the crypto market. BTC has been on a steady decline over the last few days while select altcoins continue to hit new all time highs. Most of these are related to the metaverse, and I covered one of these cryptos recently.
Given the rest of the market is in a bit of a slump, I would be very cautious about any cryptocurrencies going against the grain, especially if they look as overextended as many of these metaverse plays.
If you’re wondering where the FUD is coming from, the answer seems to be stablecoin regulation, something I also recently covered. The TLDR there is that US regulators want US politicians to put laws in place that subjects stablecoin issuers to the same standards as banks. This might sound a bit scary, but it centers almost entirely around insurance and the assets backing the stablecoin tokens in circulation.
Another factor that seems to be weighing the crypto market down is the recent rejection of VanEck’s spot Bitcoin ETF. In contrast to the futures Bitcoin ETFs we have now, a physically backed or spot Bitcoin ETF is backed by actual BTC. This means the company issuing the ETF shares has to actually go out and buy BTC to back those shares, which has a direct (ish) effect on the price of BTC. Futures backed Bitcoin ETFs just create deviations in BTC futures prices.
On the bright side, we seem to be on the cusp of a futures backed Ethereum ETF (something I covered in my video today). I know I just said that this would have no direct effect on the price of the crypto in question (in this case ETH), but it does have an indirect effect.
Besides the hype around the event itself, a futures backed Ethereum ETF would give a lot of legitimacy to ETH as an asset. A lot of institutional investors are fans of ETH too, so it’s possible we could see additional indirect factors pushing up its price.
In terms of what’s in store for the crypto market this week, it looks like BTC will continue drifting down to between 61-62k where there’s a lot of price support. However, it’s also possible that we could see a sudden reversal come Monday, and that’s because of Bitcoin’s upcoming Taproot upgrade that’s scheduled to happen today- this requires its own section…
🚰 Taproot Upgrade 🚰
Assuming Bitcoin’s Taproot upgrade goes smoothly, it should be live by the time you read this sentence. Taproot is admittedly technical, but the simple explanation is that the Taproot upgrade makes every BTC transaction on the Bitcoin blockchain look identical. This is more significant than you think, and that’s for three reasons.
First, institutional investors often use multi signature wallets to custody their BTC. Prior to Taproot, BTC transactions made from these multi-sig wallets were easy to spot using a blockchain explorer. Obviously this created some degree of risk because you could theoretically figure out who holds the keys to these wallets and force them to sign a transaction.
With Taproot, transactions made from multi sig wallets look like a transaction made from a regular wallet. This increases privacy for institutional investors which should theoretically make them more comfortable investing in BTC. It could also make the SEC more willing to approve a physically backed Bitcoin ETF because it would make BTC custody for such an ETF more secure for the same reason.
Second, Bitcoin’s Lightning Network is arguably the key to global Bitcoin adoption. Prior to Taproot, the multi sig transactions used to open and close Lightning Network channels were likewise easy to spot using a blockchain explorer. Again, this created some degree of risk because you could theoretically figure out which two parties are a part of that payment channel.
With Taproot, transactions made from multi sig wallets when Lightning Network channels are opened and closed look identical to a transaction made from a regular wallet. This increases privacy for Lightning Network users, and regulatory rhetoric suggests the privacy of the Lightning Network is on par with Monero. This should theoretically make the Lightning Network a sort of high performance privacy layer for BTC transactions.
Last but certainly not least, Taproot could be a precursor to the blow off top of this bull market. Bitcoin’s last upgrade happened in August 2017. This upgrade was called Segwit, and it essentially doubled Bitcoin’s transaction speed.
Four months after Segwit went live, BTC hit its all time high of nearly 20k. Now obviously there’s no guarantee the same thing will happen this time around, but it’s certainly something to keep in mind going into early 2022.
🪂 Free Crypto! 🪂
On Monday I was happy to learn that I got some free crypto sent my way. That was in the form of the ENS airdrop that was given to all of those addresses who own or who had owned an ENS domain name (.eth).
As I explained earlier, I will be hodling that ENS for some time but the main thing I wanted to talk about is just how lucrative these airdrops can be. I have received a number of these over the past year and many of them were completely unexpected. For example, I had received the UNI & 1INCH airdrops last year as well as the DYDX one in September.
However, I happen to think that we could see a flood of airdrops in the coming months. That is mainly as a result of projects trying to quickly decentralise themselves while still keeping the community engaged with the protocol / dApp itself. Moreover, it will allow for community governance that will take the heat off of the protocol developers from overzealous regulators.
So, this all then begs the question: Can you predict airdrops?
Well, it’s not an exact science as it always comes down to the decision of the project team itself. They may have very specific legal or operational reasons as to why they want to avoid any sort of distribution. For example, many may want to avoid airdropping to US residents (thank the SEC for that).
Moreover, while the airdrops that you read about in the press are lucrative, there is a minefield of really low value airdrops happening on substandard protocols. There are also a lot of scam airdrops out there that tend to sucker in the newer crypto users.
Having said all this though, I happen to think that there are still some really high valued Airdrops around the corner and there are a number of things that you can look for. I should of course caveat that this is all my personal opinion and speculation!
Firstly, as I explained in a Telegram post the other day, a prime candidate could be MetaMask. There was a lot of speculation about this before and it seems long overdue. If you want to increase your chances, consider using the MetaMask AMM to swap some tokens. If you were going to swap something anyway, it’s a win-win.
Then you have to consider all the other popular Ethereum Layer 2 solutions that don’t have their own token yet. These include the likes of Arbitrum & Optimism. I have given a guide on how to use these protocols here and they are a great way to reduce gas fees. If there is a small chance you could get a future airdrop – all the better.
Then you also have to consider some of the NFT marketplaces that are out there. A prime example here is Opensea which, unlike Rarible and SuperRare, does not have a governance token. Could they consider dropping one? Maybe, maybe not. But if you were considering picking up an NFT at all, you may as well use it as it’s the most popular – guide here.
Of course, while we are on the topic of NFTs, some of the most popular collections are dropping community / governance tokens to the holders. For example, recently you had the AGLD airdrop on all holders of Adventure gold. There are so many of these going on that I can’t mention all of them. But, if you were thinking of buying an NFT at all, consider looking into those that have opened the door to potential airdrops.
You also have to consider that everything I have mentioned above is on the Ethereum blockchain. There is extensive potential for other airdrops on other chains like Solana, Avalanche, Cardano etc.
There is a lot more to the airdrop conundrum and I will be coming back to it with an updated video guide – but thought that I would share some initial hints and tips here.
🔥 Deals of The Week 🔥
⭐ Rising Exchange Star: This year FTX has exploded to become the fourth biggest crypto exchange. That raise has seemingly come out of nowhere.
The reason behind that increase in popularity is probably due to the vast array of fiat currencies supported by FTX and the fact that around 275 altcoins are on the shelves here.
On top of that, trading fees are super low here and most people can crush those down to a mere 0.06%! To place that into context, fees on Kraken Pro can be up to 4.5 times higher!
Those sort of fee discounts are possible due to a special deal I have been able to secure you. In addition, you’ll get your first $30 in trading fees for FREE here!
Still need to learn more about FTX? Well, you can watch my dedicated video telling you everything you need to know about the exchange!
👉 Sign Up To FTX For That Exclusive Deal & Get Your 1st $30 In Trading Fees For FREE!
Based in the US? 🇺🇸 Well, the good news is that FTX has it’s very own version of the exchange for Americans.
👉 Sign Up To FTX US & Your First $30 In Trading Fees Are FREE + You’ll Get A 10% Fee Discount For Life!
Yes, there are some differences between the global and US facing versions of FTX. So, you might want to learn all about them in my comprehensive FTX US walkthrough!
🔮 Video Pipeline 🔮
- The Sandbox: Overhyped or Undervalued?
- Top NFT Marketplaces Compared
- Kraken vs. FTX
- Harmony Update: ONE Price Potential.
- Crypto.com Coin (CRO): Worth it?
- How to spot a shitcoin?
- Complete 101 Guide to Airdrops
- Polkadot PLOs: Complete Beginner’s Guide
🏆 What’s New At CoinBureau.com This Week? 🏆
✅ YouHodler: Too Good To Be True?
✅ Atari Chain: Retro Gaming to Blockchain Future
✅ Sentiment Analysis for Crypto: Featuring FEAR and GREED!
✅ Crypto Investing: 8 Blockchain Games you NEED to Check Out!
That’s about all I have for this newsletter. However, I have recently been racking my brain to come up with ideas to thank all you guys for your support. One idea I am toying with is holding a Coin Bureau crypto event in London, I have alluded to this in a recent video and it is an idea that I am only just building out with the rest of the team.
However, if you want to be kept updated with developments there, then you probably want to give me a follow on Twitter to be kept in the loop.
Guy your crypto guy