Took .75% position in Chainlink $LINK at 25.941. I think it has asymmetric risk reward into a humiliating defeat for Biden in the midterm elections. This will remove Gensler's sword of Damocles hanging above Chainlink's Oracle TAM.
1/ Republican sweep odds just broke 50%
2/ Odds of $1.5 T or lower package just hit highs. Support for aggressive green spending for tomorrow is probably harder to muster when the world's gas infrastructure seems to be blowing apart today. Biden is uncharismatic, doesn't do interviews, and is fading fast.
3/ Gensler's aggression re: defi regulation compared to Jay Clayton is heavily predicated on him having a mandate. A republican sweep of the house and senate would raise the spectre of Trump 2024 who would probably like defi bigly. Gensler already seems unpopular with the crowds
4/ Chainlink 101: you have a bunch of people agreeing on prices on things. This allows people to trade the things. Because trading the things generates all kinds of fees and yields, Chainlink holders can get paid for serving as "oracles". Now, what type of things, you ask?
5/ Enter the regulatory question. Right now Chainlink integrates with many different players in the crypto ecosystem - ensuring security and accuracy for various defi lending, NFT & game applications. But this is a tiny TAM compared to Oracles being allowed into the "real world"
5/ Chainlink just launched decentralized USDJPY trading with multiple oracles verifying the price. The obvious growth path for this type of thing is decentralized stock trading, or debt financing - large regulatory taboos at the moment.
6/ I'd also note Chainlink has partnered with my friend @TiingoFinance who runs a high quality financial data service. I've heard pretty positive things re: the experience of running a node, the installation as well as the quality/professionalism of the Chainlink dev team
7/ The status quo for oracles link Chainlink is that they need to exist within a regulatory framework enforced by a hedgemon. That means equity issuance needs to be regulated and "fiat native" so even if "stock tokens" can trade on FTX, it's just a shady derivative
8/ The potential transformation is that equity issuance, accounting, ownership, financial use cases could happen sans governmental middleman. This world would be crazy in a Democratic senate/house/ presidency. But in Trumplandia... it is conceivable
9/ Will check in @ Chainlink Hackathon opening ceremony on October 22 where there will likely be some project updates. In BTC terms Chainlink is .00045 and looking to reassess near .00058/65k BTC which would be about $38. Will stop out if infra bill is > $1.5T or hackathon is bad
10/ In summary -- I think the break higher in Bitcoin with a backdrop of Biden's presidency collapsing into midterms will de-risk a number of regulatory issues with both Oracle and Defi projects, catalyzing a move higher in Chainlink. (please consult disclosures in my profile)
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