Bitcoin’s retrace into the mid-80s has triggered the darkest sentiment since the FTX collapse, yet the macro environment is the strongest it has been at any point in this cycle.
Liquidity is set to expand, sovereign hard-asset accumulation is accelerating, institutional allocation continues quietly, and the core drivers of the neutral-reserve-asset thesis have strengthened. The selloff is dominated by short-term capitulation, not structural weakness.
Meanwhile, gold is signaling falling real rates, Block is operationalizing real-world Bitcoin integration, and AI-driven equity concentration is emerging as a systemic risk.
The market’s emotional reaction is misaligned with the fundamentals; the bull market is not ending, it is beginning.
Sentiment Collapse vs. Macro Reality
Market psychology is anchored to outdated four-year cycle heuristics, ignoring a liquidity regime shift.
Rate cuts plus the December 1 end of QT create a materially different backdrop than 2021–2022.
Institutional flows (Abu Dhabi, Harvard, Emory) show no deterioration and point to rising strategic demand.
The drawdown is driven by short-term holders who do not understand the asset, not structural sellers.
Bitcoin remains the only globally neutral, finite monetary asset with improving fundamentals.
Volatility Is the Entry Point for Long-Term Capital
Three 30%+ resets in 12 months reflect a healthy market structure, not systemic stress.
Institutional allocators prefer to enter on weakness; this correction fits their operational playbook.
Retail participation remains muted; a late-cycle blow-off has not occurred.
Volatility remains the tariff long-term investors pay for asymmetric upside.
Supply concentration is increasing among entities with multi-year horizons.
Gold’s Outperformance Reveals the Liquidity Signal
Gold’s rally reflects sovereign reserve rebalancing, falling real rates, and geopolitical hedging.
Bitcoin’s sovereign bid is emerging but remains early; expectations outran reality in early 2025.
Wall Street’s infrastructure gap (custody, trading, internal approvals) delays broad-based flows.
Market structure suggests Bitcoin lags gold in 2025 and outperforms decisively in 2026.
The divergence is driven by liquidity, not fundamentals; Bitcoin’s thesis remains intact.
Corporate Adoption Moves from Theory to Implementation
Block’s investor day confirmed meaningful traction: multiple units generating $100M+ net profit.
Merchants can now sweep revenues directly into Bitcoin, a turning point for corporate treasury behavior.
Cash App enables interoperable transactions: pay in dollars, receive in BTC, zero friction.
True MoE → SoV conversion is becoming seamless, a critical requirement for mainstream adoption.
This represents the earliest stage of genuine corporate Bitcoin integration at scale.
The Slop Economy: Speculation as Monetary Policy
Prediction markets, collectibles, crypto products, and AI narratives are converging into a leverage machine.
AI equity concentration is now viewed as the #1 tail risk by fund managers.
OpenAI’s rumored request for a federal backstop exposed systemic fragility beneath the hype cycle.
Coinbase and StockX entering prediction markets signal the institutionalization of gambling mechanics.
These trends reflect a system searching for yield ahead of the next liquidity expansion.
Quote of the Week
“Volatility is the opportunity. The people who understand the fundamentals get more sats for every dollar they earn.” — Michael Tanguma
🎤 Who Should We Bring On Next?
We want your input. Reply to this email with:
Who you want as a guest
Why they matter right now
One question you want us to ask them
I’ll review and respond to each submission.
— Jackson, Host of The Last Trade
P.S. Don’t want to reply? Just drop the name in the comments on the web version.
Does your Bitcoin keep you up at night?
Self-custody: Lose a device, forget a phrase, or make one wrong move, and your Bitcoin could be gone forever.
No inheritance plan: If something happens to you, how would your loved ones access what you’ve built?
Exchange exposure: Billions have been lost to hacks, outages, and custodians failing altogether.
That’s why more serious investors are moving to insured, multi-institution custody with built-in inheritance planning and seamless access to financial services.
Onramp — Where Security Meets Simplicity.