👀 3 things you can't miss this week

GM everyone. This is 2036.

It’s been a hell of a week.

Here are 3 quick things you don’t want to miss:

1/ Inflation came in lower than expected 📉

Why is this important?

Because the Federal Reserve is keeping interest rates high to quell inflation.

When inflation falls, they are more likely to cut interest rates faster to prevent the economy from slowing too much.

Lower interest rates = excellent for risk assets as investors are forced to go out on the risk curve into things like stocks and crypto (and away from bonds and cash) to get returns.

In reaction to the low inflation reading, small-cap stocks had their strongest 1-day performance since the beginning of the year.

That’s because lower rates benefit high-risk assets the most, so investors rotate out of bigger stocks into smaller, higher-risk ones.

And you know what usually follows a rotation into higher-risk, smaller-cap stocks?

You guessed it— crypto.

Historically, small-cap stock outperformance tends to coincide with crypto strength:

So once the German government is done selling (we’re almost there, only $300 million left), I expect to see more strength in crypto.

2/ Trump speaking at the Bitcoin conference in Nashville 🟠

From the looks of it, Trump is likely to win the US presidential election.

And in the last few months, he’s become increasingly pro-crypto (he also has an NFT collection).

Well, it just got better: he will speak at the annual Bitcoin conference in Nashville in two weeks.

That’s big news.

A past and likely future president of the United States… speaking at a Bitcoin conference.

Music to my ears.

I sincerely believe that Trump winning the presidency is one of the most mispriced events in crypto.

Trump would likely replace the anti-crypto SEC chairman Gary Gensler with someone much more pro-crypto.

And any pro-crypto comments he makes along the way could majorly move markets.

You love to see it.

3/ Solana’s biggest 1-day inflow of stablecoins YTD 🌊

In the last 48 hours, Circle minted $500M of stablecoin USDC on Solana - the largest 1-day inflow of all of 2024.

Every time this has happened before, SOL has pumped strongly afterward.

Could it be Blackrock preparing to file for a Solana ETF?

I don’t know.

All I know is that:

• most crypto participants are tired, bored, and bearish

• the macro backdrop hasn’t looked this good since the beginning of the bull market

… and months of negative sentiment can be eliminated in a few days of trading activity.

All eyes are on Bitcoin to lead the next leg higher.

1/ Germany is almost done selling its Bitcoin

2/ 5th day of consecutive net inflows into Bitcoin ETFs… boomers are buying the dip

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.