On episode #13 of Alpha Bites, JJ explains why Bitcoin continues to climb the wall of worry as the DXY continues to show strength and BTC momentum stalls. All eyes are on the Fed minutes and coming news events to see if an impulse higher remains possible.
Unfortunately, notable investors, including Michael Burry, add to their short market positions suggesting more downside is likely although timing (Q4 2023, Q2 2024, etc.) remains a question.
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JJ also introduces a custom metric called the DXY Risk Rating that tracks the dollar index and assigns ratings from green (bullish) to red (bearish) to gauge market risk levels. Currently in the orange zone, the metric cautions against longing in this market.
Next, Ray notes that Solana has outperformed its ecosystem peers like BNB, Ethereum, Atom, and Cardano in price this year, and might still have room to grow. He adds that Solana lacks robust liquid staking, which could provide utility to its large staked supply and boost its DeFi ecosystem, similarly to how it supported growth on Ethereum. Kodi and Ben offer conflicting views on the fundamentals of Solana, suggesting that the project is worth a deeper dive.
Next, Ben Lilly argues that the Stock-to-Flow model has some utility but is severely flawed in that it only considers supply and not demand, and why this matters in a bull market environment. Ben also offers a path to making the model more robust.
Kodi reviews three projects on the "Like It or Spike It" segment.
* Friend.tech is a new decentralized social media app launching on Basechain that allows users to create profiles tied to their Twitter account and for others to invest in their "social tokens"
* Aktionariat tokenizes shares of private Swiss companies, allowing retail investment and liquidity for these companies. It currently has 39 companies and $450M total market cap
* Zaki, one of the godfathers of Cosmos, defends the Agorix token BLD saying "it might be a better index of IBC than Atom"
On the deep dive, Ben breaks down the news that Hedera is being considered as a micro-payments solution for the FedNow project and why it might be positive for crypto. Ray remains skeptical that adoption of Hedera solutions will result in a significant price gain for the HBAR token, despite the 15% gain on the news announcement.
Finally, Marconi asks the team to wager that Michael Burry's massive $1.6B market short position primarily in SPY and QQQ puts will yield a profit. JJ, Kodi, and Ray offered 50% to 70% odds that Burry makes a profit, while Ben Lilly argued the odds shifted to much higher if the positions are held through 2024.
TL:DR, the team expects a massive market correction, just not yet.
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