Sup, nerds!

Here’s what you’re getting in today’s edition:

• 💅 This is cool: How corporations are pumping BTC

• 🔎 This seems important: Ethereum ETFs put on pause

• 🤝 Partner: Fortune favors the bold​

• 🔪 Let's dissect this: Buying ETH for $0.311 per token…

• 💡 Bellwethers in Web3: Ryan Horst, BIG Crypto

Terms used in this edition (click for an explanation, or ask Web(GPT)3!):
Market cap, degen.

💅 This is cool:

How Corporations Are Pumping Your Bitcoin Bags

In one sentence: The genius of MicroStrategy’s BTC treasury = $MSTR buys BTC → the more they have, the more exposure they get to its price appreciation → which attracts investors → which pushes their stock price up → (repeat).

So Japan’s Metaplanet just bought another $1.2M worth of Bitcoin for its corporate treasury, and it got us wondering…

What’s so great about this ‘corporate Bitcoin strategy’?

For that, we looked to the guy who created it, Michael Saylor, and his company, MicroStrategy ($MSTR).

Let’s start with some stats:

• Over the past decade or so Bitcoin has increased ~10,000%

• $MSTR started buying BTC in Aug 2020, with an average purchase price of $35k (which means they’ve made an ~80% return so far)

• In that same time the S&P 500 (an index of America’s top 500 company’s) has gone up 63%

So…

If MicroStrategy had’ve just invested in a fund that tracked the S&P 500, they would have had a MUCH safer margin for error (Bitcoin is highly volatile, the S&P 500 is not).

So why is this not going down as the dumbest financial move of all time?

Simply put: $MSTR’s Bitcoin strategy creates a flywheel effect, while buying the S&P 500 does not.

See, no one is going to buy MicroStrategy stock because the company holds S&P 500 shares.

But when Saylor launched $MSTR’s Bitcoin strategy, it was one of the only ways for stock traders to safely/easily get exposure to Bitcoin’s upward price movements (from a regulatory standpoint).

So all of a sudden, $MSTR stock became a magnet for investor dollars — and with that, its market cap increased.

Then, and this is the wildest part…

$MSTR started to issue/sell new shares, diluting existing shareholder value, and use the funds to buy more Bitcoin…

Diluting the value of existing shares, by making and selling more of them? That typically leads to a stock’s price falling.

But in MicroStrategy’s case, it increased share value, by — get this — 10x over roughly four years.

The flywheel powering this increase works like this:

MSTR buys Bitcoin → the more Bitcoin they have → the more exposure they have to Bitcoin’s price appreciation → which attracts more investors → which pushes their stock price up → which allows them to buy more Bitcoin.

(Rinse/repeat).

And all the while, $MSTR has its traditional software business to weather any storms in Bitcoin’s price fluctuation.

Now, here’s the cherry on top:

As other companies, like Metaplanet, start to follow suit — it will only help to stabilize and push Bitcoin’s price higher over time.

And MicroStrategy (along with every other BTC holder out there) will be massive beneficiaries of this growth.

Very cool.

🥇 Want the news before anyone else?

🔎 This seems important:

The Ethereum ETFs Are on Pause (But Only for a Couple Weeks)

In one sentence: Hopes that the Ethereum ETFs will launch as early as this week are fading, betting markets now giving a Jul 26 launch a 77% chance.

Ok, that last article was a doozy!

So we’ll keep this one short n’ sweet.

Hopes that the Ethereum ETFs will launch as early as this week are fading.

This comes off the back of news that the SEC has recently requested potential ETF issuers to amend their applications (this doesn’t typically happen if things are good to go).

Here’s two solid reasons not to care:

1. Whether it’s one week, or one month from now — these ETH ETFs are happening. That’s what matters in the long run.

2. The launch of ETFs doesn’t guarantee Ethereum’s price will all of a sudden skyrocket (in fact, BTC dumped when its ETFs were launched).

Good news is:

(If betting markets are to be trusted) there’s a 77% chance they will launch this month — by July 26 to be exact.

Alright, now you know!

🤝 Partner:

Fortune Favors The Bold

Ever wish you could turn back time and invest in Amazon's early days? Well, buckle up because the AI revolution is offering a second chance.

In The Motley Fool's latest report, dive into the world of AI-powered innovation. Discover why experts are calling it "the rocket fuel of AI" and predicting a market cap nine times larger than Amazon's.

Don't let past regrets hold you back. Take charge of your future and capitalize on the AI wave with The Motley Fool's exclusive report.

Whether it's AI or Amazon, fortune favors the bold.

Don't miss out. Dive into the report today.

🔪 Let's dissect this:

What Would You Do if You Bought ETH For $0.311 per Token in 2014?

In one sentence: One anonymous degen bought 254,900 ETH in at an ICO price of $0.311 per token back in 2014, and has never moved over 47,000 ETH - until yesterday.

This’ll age us but…we remember the ‘ICO era’ of crypto.

If you have no idea what that is, for a while between ~2013-2018 or so, ‘initial coin offerings’ were all the rage.

They were a popular way to raise funds through crypto, letting many people have a small stake in your company (through tokens), but instead of everyone having to be an accredited investor, those who can figure out crypto wallets, can invest.

(There are a few blurry lines with ICO’s, but that’s not the point of this article).

A couple of notable tokens raised their initial funding through an ICO - like Ethereum which raised ~31,000 BTC in July 2014, equal to about $18.3M USD at the time.

From that ICO, most people who bought in early have since sold.

One anonymous degen though, bought 254,900 ETH in at an ICO price of $0.311 per token, and has never moved over 47,000 ETH, ever.

Until yesterday - when they moved 7000 ETH (worth about $24.3M USD) from their cold wallet to Kraken.

Why is this important?

When someone moves their crypto for the first time after years of holding, it usually suggests two things: they’re about to cash out (for fiat currency), or they’re about to degen into their next big crypto bet.

For coins with smaller market caps, movement like this from a single wallet could be huge cause for concern.

But with ETH hangin’ steady at a cool $417B+ USD right now, $24.3M isn’t a drop in the ocean.

Alright, now you know!

💡 Bellwethers in Web3

"Bellwether's in Web3," is a daily profile series recorded live with Nolcha Shows and Movement Labs in collaboration with Bellwether Culture. Check out the latest video below.

Interview: Ryan Horst, CEO of BIG Crypto

Ryan Horst is the CEO of BIG Crypto, a cryptocurrency consulting company. Ryan got started with crypto back in the Summer of 2017 right before the very first Altcoin Bull Run in history occurred, giving him the unique perspective of being able to see how the crypto industry as a whole has matured over time.

Follow: @ryanhorst_ (Instagram)