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🥇 2023's winners and losers

🥇 2023's winners and losers

PLUS: Litecoin is having a moment

Alex M.
July 04, 2023

GM everyone. This is 2036, the crypto newsletter that pays you.

Here’s what we’re serving up today 🍲: the first half of the year is over. Who were the winners of the first six months? And who will win the last six?

Let’s dig in.

🥔 Today’s meat and potatoes

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Happy 4th of July, everyone. We’re halfway through 2023.

Duh duh duh.

It was a wild six months. Some pockets of crypto thrived. Others crashed.

So let’s have a quick look at:

who did well
who did not so well - and
what we think the next six months will look like.

Without further ado, here are the big winners and losers of the first half of 2023.

First up, the WINNERS…🏆

1/ GBTC 🥇

GBTC is an investment fund that owns bitcoin for its clients. For years, it’s traded at a discount to the value of its underlying assets (here’s why).

But the wave of Bitcoin ETF filings is renewing hope that GBTC will get converted into an ETF - which would instantly eliminate the discount.

GBTC is up +149% this year and reached its lowest discount in a year yesterday (29%).

That’s nearly double the performance of bitcoin itself.

2/ Blue-chip cryptos🥈

Bitcoin, Ethereum, and Solana were also sustained winners in the first half of the year.

They’re up +87%, +63%, and +95%, respectively.

Bitcoin benefited from the banking crisis and the launch of upcoming bitcoin spot ETFs.

Ethereum benefited from its Shapella upgrade - which made it the first crypto bond (with a 5% annual yield) - an increase in fees, and a decrease in token supply.

And Solana is getting renewed momentum after developers worked hard to fix its uptime problems, and its association with Sam Bankman Fried fades into memory.

3/ Bitcoin Cash and Litecoin 🥉

Bitcoin Cash and Litecoin were the big unexpected winners of the first half.

They are up +145% and +52% this year - mostly in the last two weeks.

That’s because they’re two of only four assets (together with BTC and ETH) that’ll be listed on the new EDX market exchange.

Litecoin will also go through a halving soon, and Bitcoin Cash has seen renewed interest from South Korean investors 👀.

Now, onto the LOSERS…💀

1/ NFTs 🪦

Most major collections - CryptoPunk, Bored Ape Yacht Club, Azuki, Doodles, etc. - are down -30% to -85% in the first half of the year.

NFTs are getting butchered because:

a lot of retail speculators have left the space
collections lack new catalysts to create anticipation and excitement
a lot of NFTs have no actual utility beside “culture” and “community”
but… holders realize culture takes time, and community can fall apart quickly.

NFTs will probably become huge for gaming and brand/creator monetization. In the meantime, most are slowly bleeding to death.

2/ Centralized exchanges 🏦

Binance, Coinbase, and Kraken all got sued by the SEC this year.

And it looks like the story is not fully over yet. Rumors are circulating that more SEC actions are on the horizon.

On the other hand, decentralized exchanges like Uniswap are thriving and gaining market share.

But can Coinbase make a comeback? …details below 👇.

3/ All our favorite projects from the last cycle 💰

I hate to break it to you. We all get emotionally attached to our investments during a hype cycle.

But 99% of coins or NFTs that ripped in the last bull market will never reach their all-time high again.

Instead:

new narratives will form (which we’ll keep you updated on)
and old giants will thrive (i.e. BTC & ETH).

That’s why it’s important to see reality for what it is, even if it hurts.

Every coin you hold carries the opportunity cost of your capital being deployed somewhere else more efficiently.

With that in mind, here are some catalysts we believe could shape winners for the next six months…

CATALYSTS 📈

1/ The Bitcoin halving

Every 4 years, the amount of bitcoin distributed to miners gets cut in half. This creates an instant supply shock of bitcoin.

12-18 months after the halving, bitcoin has traditionally reached a 4-year peak in price.

And the next halving is just 10 months away.

Investors will be anticipating this moment. As usual, we expect they’ll invest early to catch this next leg up.

2/ The Ethereum upgrade

Around September/October, Ethereum will undergo its next upgrade - Cancun.

We’ll explain this in detail in a future letter, but in short - gas fees will be reduced significantly on chains that help scale Ethereum transactions.

The same way that the Shanghai upgrade was bullish for Ethereum and liquid staking coins…

…the Cancun upgrade could be bullish for both Ethereum and layer2s like Aribtrum and Optimism (more on these soon).

3/ The approval of a spot Bitcoin ETF

The big news of the year is the possible imminent approval of a Bitcoin spot ETF.

Most people underestimate how big this could be: it will bring TRILLIONS of $$ of new capital to crypto.

Bitcoin will be a winner, but so will Ethereum if an Ethereum spot ETF is in the cards right after.

And Coinbase could win too. It will likely hold and store the bitcoin of many of the institutions that get approved for the bitcoin ETF.

So watch out for that $COIN…it’s up 25% in the last 5 days on those news alone 👀

🍨 Dessert

Stories to read if you have FOMO

1/ Crypto outperforms traditional assets by 100% in first half of 2023

2/ Bitcoin crosses $31,000

3/ Litecoin is having a moment in the sun

🍸 What 2036ers know that others don’t…

So you can be the smartest cookie at your next cocktail party

For a long time, buying crypto was just the equivalent of buying the Nasdaq on steroids…

But bitcoin’s correlation to the Nasdaq is quickly falling to the lowest in years (less than 3%) as bitcoin massively outperforms…

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Our next task will start this week and run for 48 hours.

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