Willy Woo Profile picture
Apr 18, 2021 10 tweets 4 min read Read on X
#marketupdate, breaking it down, post mortem.

We just saw the single largest 1-day drop in mining hash rate since Nov 2017. The hash rate on the network essentially halved, causing mayhem in BTC price as it crashed.
The power outage in Xinjiang (which powers a significant amount of the BTC mining network) was known before the BTC price crash. Here's local news on 15th April.

translate.google.com/translate?sl=a…
16 April.

9000 BTC was sent into Binance, read that as a sell off of those coins.

I'd note that Binance serves volume from Asia more than the West. It's likely this was sent in from a whale with closer knowledge to happenings in China.
This sell down was compounded by sell off of quarterly futures (used by more sophisticated traders) on derivative markets which was already underway as early as 13th April.
The two combined sell pressures was sufficient to tip the price below liquidation levels ($59k).

This triggered a cascade of automatic sell-offs in a chain reaction.

$4.9b contracts were liquidated, $9.3b including alt-coin markets.

1m trader accounts liquidated in total.
This dip happened while unprecedented numbers of new users are arriving onto the network per day. There's been a retail influx in the last 2-3 weeks.
Strong holders are buying this dip (red = Rick Astley genre of holders)
Supply profile (price when the supply last moved), now forming the largest cluster of price discovery since BTC was below $10k. Validation of BTC as a trillion dollar asset is immensely strong.

13.5% of the entire BTC supply last moved above $1T cap.
The on-chain SOPR metric near a full reset. A classic buy the dip signal.

In simple terms, profit taking by longer term investors is completing, very little sell power left unless investors want to sell at a loss from their entry price. Unlikely in a bull market.
Summary:

- Initial sell off due to anticipation of miners going offline in China.

- Sell pressure was sufficient to trigger liquidation of short term speculator positions forcing price violently down.

- Longer term fundamentals is very strong.

Data: @glassnode @bybt_com

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More from @woonomic

Jun 14
ETFs are buying...

Institutions are buying...

Who the hell is selling?

2024 brought a mass of commentators looking at ETFs flows, as if that's all that matters.

What matters is total demand and supply.

Here's a 101 thread on how the modern #Bitcoin market works.
First, let me tell you who is selling.

The OGs. They are selling

They have more BTC than all the ETFs put together... 10x more.

And they sell into every bull market.

This pattern is as old as the genesis block.

Chart below: the age x amount of coins being sold. Image
We are now in the modern age of BTC.

Paper BTC has flooded the market since 2017.

Futures markets.

If you want to buy BTC, it used to be you had to buy real BTC.

You can now buy paper BTC. Thus a no-coiner can sell you that paper.

Together you have made a synthetic BTC.
Read 7 tweets
Apr 15
Want to know which indicator called the last 2 large corrections within hours?

It's the moon. I shit you not... that sell signal is a particular phase of the moon.

🌘 Image
The correlation to the moon has been well studied, here's a 2005 study looking at price impact on stock markets.

If you run the correlation, the moon cycle strengthened its impact after the Global Financial Crisis of 2008.

That event may have lead to the birth of meme stocks. Image
🔫 You may say it was War, and pricing in War, that lead to the last #BTC pull back.

🌘 Or maybe it was just that time of the moon cycle when in a tense situation humans felt shitty enough to launch a drone + missile attack. Image
Read 4 tweets
Jun 10, 2023
Money has always been a balance sheet of who owes whom.

This accounting needs to be agreed upon. And there’s only 3 known ways:

1) with social consensus

2) with matter

3) with energy
1) social consensus

Examples include fiat and proof of stake.

The ones in power (the wealthy) aim to control opinion to keep faith in the accounting system.
2) matter

This is how we used to do it.

We use something physically scarce so the accounting can’t be rigged. Gold backed money, silver coins, Rye stones, livestock, etc.

This doesn’t work with increasing technology. Things cease to be scarce with sufficient tech.
Read 5 tweets
Jan 17, 2023
CVDD Floor (circa 2019) successfully defended for 2 months straight, the first proper test apart from COVID where the crash got close.

Hope this is not famous last words :).

Spot momentum has been strong throughout this move, there was also solid accumulation for months at 16k.
Cost basis comparison suggests the bottom has formed. The peak discount that short term purchases got over long term purchases has crested.

It's only at the deep parts of a bear market do short term coins get cheaper than long term coins.
BTC Macro Index. Pretty safe time to buy.

Look at the vertical halvening bands; we are now around 1 month away from the period where the re-accumulation phase of the market starts engaging.
Read 6 tweets
Jan 7, 2023
BTC on exchanges since 1st Apr 2022, just before the deleveraging dominos started falling.

Y-axis is % difference and line weight is proportional to BTC held presently.

Winners: OKX & Bitfinex
Neutral: Binance
Losers: Everyone else
Bitfinex is the sleeper here.

The parent entity, iFinex, is making huge profits with its Tether capital sitting in US treasuries. Tether earns $3b per year right now. iFinex also has 94,000 BTC returning from the Bitfinex hack funds seizure ($1.5b).
Capital moving to OKX may explain its exchange token performance in this bear market.
Read 7 tweets
Dec 30, 2022
DeFi apps can never be truly decentralised.

Been pondering this deeply.

Anything that works will need trusted centralised parties.

If true, dapps and L1s are just a wild goose chase over an intractable problem.

Please prove me wrong.
Best way to prove me wrong is to name a dapp that provides a benefit that people want that cannot be done by better by existing Web2 and Bitcoin technology.

Example arguments:
- why a DEX will be better than a CEX
- seamless fintech inter-op across the web using MetaMask
I suspect the 2 key issues needed to be solved in order to have true decentralised apps that can fulfill the dream of "Web3" are:

- prevention of sybil attacks
- ability to peer into the global state across all L1s by any dapp. (I think this problem is provably intractable)
Read 10 tweets

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