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Jeff Dorman Profile picture
@jdorman81
Aug 31, 2020 • 7 tweets • 2 min read • Read on X
We explore 2 themes in this week's "That's Our Two Satoshis" digital assets market recap via @arca:

1) #Bitcoin is unequivocally a global macro asset following reactions to Powell's speech.

2) The 2020 rally is much more sustainable than 2017

ar.ca/blog/crypto-ma…

Thread 👇
Bitcoin moved in lockstep with other macro assets last week following Fed Chairman Powell's speech. Bitcoin and gold tracked each other almost perfectly, with a 3-day correlation of 0.76 before, during, and after Powell’s speech. Image
Irony: many investors left Wall Street and came to digital assets specifically to get away from the “don’t fight the Fed” manipulated equity & debt markets, and yet a few years later, Bitcoin investors are now hanging on every word from Powell too.

Meanwhile, small cap, value-accruing digital assets continue to outperform large-cap, legacy "cryptocurrencies" that accrue no value. While some are comparing the euphoria to 2017, today’s market resembles nothing close to that of 2017.
The biggest difference between 2017 and 2020 is that many of the tokens today are being created AFTER a company has already found product market fit, which creates much more sustainable growth.
Instead of tokens issued simply to fund pipe dream “decentralized projects” with low probabilities of success, many of today’s leading tokens are used to enhance already thriving ecosystems and to grow customer bases faster.
Blockchain technology itself is revolutionary.
But these hybrid equity/utility tokens (or pass-thru tokens) are evolutionary.

We believe pass-thru tokens are amongst the most novel capital formation & bootstrapping instruments ever created.

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More from @jdorman81

Jeff Dorman Profile picture
Aug 4
What new info do we have that is causing a crypto panic? Let's evaluate one at at time

5 reasons:

1) Macro
2) Jump selling
3) ETF flows
4) Kamala jumping in the polls vs Trump
5) Middle East
6) Supply
1) Macro signal Friday was obvious short-term sell signal. 10yr UST fell -40 bps, oil smoked, equities continue to bleed & the VIX spiked +25% Friday.

But long-term, VIX is conditioned to retreat, Fed will cut rates in Sept, and still an election year

TRADE? Buy this dip
2) Jump selling - maybe bought puts ahead of dumping? 90%+ of the selling of ETH is sold/at exchange. $510M of $550M in wallet is in stables now.

Interesting that they are transferring stables back out to their wallets instead of off-ramping at exchange

TRADE? Buy this dip Image
Read 8 tweets
Jeff Dorman Profile picture
Sep 13, 2023
Been tweeting / replying a lot today about the FTX court approved sale of crypto assets, so if you missed key points, here's a summary with a few updates:

1) Galaxy Asset Mgmt, not their trading desk, won the bid. They must act as a fiduciary & sell gradually & opportunistically
2) Galaxy is receiving massive amounts of reverse inquiry already (some from real funds, some fishing expeditions). But OTC sales will dominate the buying. Less likely to see a lot of selling on exchange or via TWAPs. As good bids come in, they will engage.
3) The $100mm max per week is really not relevant. They can ask for court approval if they get a bigger block bid, and they don't have to sell anything in any given week. The $100mm was just a guideline to prevent dumping and destroying value for the estate.
Read 9 tweets
Jeff Dorman Profile picture
Jun 5, 2023
My 2 sats on SEC vs Binance

Mostly irrelevant since no one operates in the US anymore and a bunch of non-criminal charges for past wrongdoings don’t really matter.

I see 2 actual negatives from this: ⬇️
1) SEC explicitly defining certain tokens randomly as securities could lead to delistings on Kraken & coinbase or any other US exchange

2) negative sentiment effect if CZ is out and people loved him

That’s about all I see. Pretty benign otherwise.
From a market standpoint... how many times can you rally on the same news over and over again (2020 - corporates buying BTC) or sell off on the same news (2023 - SEC hates crypto)

It just doesn't have much impact any more
Read 4 tweets
Jeff Dorman Profile picture
Jan 24, 2023
1) The $DYDX tokenomics model is broken, with several key issues:

- Revenues flow to dYdX Trading instead of to tokenholders
- High Inflation & Large upcoming unlocks
- V4 Shipping delays

A thread on the problems & suggestions 👇

h/t @Crypto_Alex17 @MattHepler8
2) Over the past 6 months we observed other $DYDX stakeholders highlight these same issues on DYDX’s public channels. We expect significant improvements to the value & sustainability if the tokenomics are fixed, especially as users move from CeFi to DeFi derivatives post-FTX
3) Arca has engaged the @dydxfoundation , DYDX Trading & major stakeholders to address some of these issues but have been met with resistance and apathy.

With product delays ahead of a major bear market unlock, it is time to make this discussion public.

Let’s dig in:
Read 23 tweets
Jeff Dorman Profile picture
Jan 23, 2023
Last week, Genesis filed for Chapter 11 bankruptcy protection bringing restructuring negotiations to the public. While we cannot predict how negotiations will end, we pored through filings to synthesize lessons learned and where we might be headed.

Here are 4 key conclusions:
#1: The Genesis bankruptcy represents the end of the forced selling of assets—especially the Grayscale trusts. Gemeni liquidated about 5% of GBTC shares in November that was being used as collateral from Gemeni causing an artificial widening of spreads of GBTC to record levels.
#2: DeFi again proves to be superior to CeFi for risk management. We’ve written about this theme several times and now the Genesis bankruptcy is a prime example of the relative failure of CeFi.
Read 7 tweets
Jeff Dorman Profile picture
Dec 15, 2022
The SBF saga / theatre at this point has no bearing on the market.

Here are 10 much more relevant digital assets stories to follow: 👇
1) Audits

Have you ever gone thru a crypto audit? The auditors are still learning themselves. It's one thing to prove you have assets in the wallet; it's quite another LONG ordeal to prove you have access to all of them.
1b) And auditors do not like to take risks (see the fallout of Arthur Anderson after Enron).

So if your base case is that "no audit = bad actor"... you may want to consider that "no audit may = auditors are scared of being wrong"
Read 19 tweets

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