Thread by @Rptr45

0/ $BTC finished September down (13.5%) marking the third consecutive negative monthly close for the 12th time in 105 months.

1/ This meant $BTC finished 3Q (23.5%) the 5th worst quarterly performance dating back to 2012. Perhaps this shouldn’t have come as a surprise as this following 2Q’s +163.5% or the 3rd best quarter of all time

2/ As a result $BTC's “realized cap” vs. “market cap” is has come back in to <45% premium with Sept marking the lowest monthly reading since May.

3/ At last price $BTC is now trading at aa ~42.2% premium to the “theoretical cost basis” which is in the bottom ~40% of observed period back to 2010.

4/ What’s notable is given the amount of time we spent >$10K during the quarter the “theoretical cost basis” of $BTC reached the highest levels ever observed on 9/23 at $5732.61 (vs. $5659 last).

5/ September marked the lowest $BTC daily “adjusted transaction volume” since March at ~$2.1bn.

6/ Looking at $BTC realized vol, despite the month-end sell off Sept marked the lowest month since March of ’19.

7/ As it pertains to “leverage” both $BTC funding on Bitmex and the Bitfinex L/S ratio have seemed to lose some of their impact. Sept marked the tightest Bitmex funding range since February with October MTD on track for the tightest monthly observation.

8/ The L/S ratio on Bitfinex has become less and less meaningful as volume continues to dissipate from the exchange but still sits in the ~90% of observed periods.

9/ Taken together it looks like a mixed bag although Bitmex is still the better indicator of true “market” positioning.

10/ This week marked the fourth consecutive lower close for the first time in nearly 2 years.

11/ This corresponded with the year+ long anticipated @Bakkt launch which has been underwhelming by even the most modest standards trading $6.5mn of volume in the first week with the highest volume day to date of ~$1.4mn.

@Bakkt 12/ So where does that leave us as we enter into 4Q? BTC is still +100% YTD which if the year ended today would be the second “worst” up year (to 2015). As we look at 4Q seasonality we’ve had 3 down quarters out of 8 (including last year).

13/ The “herd” has been a disappointment thus far but with @TDAmeritrade @CharlesSchwab
@etrade all cutting trading to $0 fees $BTC isn’t a bad place to turn to get some “spread back.” Which can help with the institutional plumbing.

14/ Each day that goes by we’re closer to the May halving. Looking at historical performance peak outperformance has been in the 90-240Day pre which we have just entered.

15/ The macro environment continues to be supportive of BTC long term but it’s yet to be seen how it performs in a true “risk off” environment.

16/ As always given the reflexivity of the asset the trend is your friend and don’t try to pick bottoms when we’re still +100% YTD. Let a true bottom form like we saw in Dec-Feb (not June-Nov of ’18) before committing on the long side (as opposed to trading around)