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Meltem Demir◎rs Profile picture
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14 Jun, 8 tweets, 4 min read
1/ paul tudor jones suggests a 5% allocation to #bitcoin as an effective portfolio diversifier

our team @CoinSharesCo did the research, and our recommendation? 4%

why?

let's delve into portfolio construction and the numbers - see the full report here coinshares.com/research/a-lit…
2/ over the last 18 months, bitcoin has been increasingly financialized as an asset

our weekly digital asset fund flows report shows AUM in crypto products is nearly $50B, a sharp increase from $5B a year ago when PTJ first talked about bitcoin 😎

medium.com/coinshares/vol… Image
3/ behavioral analysis of bitcoin holders also shows that investors holding bitcoin longer than a year has risen from ~30% in 2012 to ~55% today

in 2020 alone, ~22% of all bitcoin in existence were moved off exchanges (presumably into LT custody + ETPs) Image
4/ bitcoin sits in a unique place in the economic cycle, and while bitcoin may have emerged in the last economic crisis, we have yet to gather enough data to understand the relationship between bitcoin and inflation, as well as bitcoin and broader macro-economic cycles Image
5/ if we place bitcoin in a traditional 60/40 portfolio, it outperforms other portfolio diversifiers like gold, real estate, and other common alternative investments

bitcoin has an asymmetric return profile, with annualized returns 2x that of alternatives w similar downside risk Image
6/ even if bitcoin was added to a portfolio at the peak in late 2017, it would still enhance portfolio returns with a significantly better sharpe ratio than other alternatives Image
7/ the most significant improvements in Sharpe ratio (risk-adjusted return) are seen with allocations of up to 10% bitcoin in the portfolio

this highlights how a small allocation can make a dramatic difference in portfolio performance Image
8/ in the report, we also highlight the reduced risk from quarterly rebalancing to maintain portfolio weights, and touch on broader macro correlation

for those who are interested, i highly recommend our research portal - coinshares.com/research - lots of great content!

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More from @Melt_Dem

Meltem Demir◎rs Profile picture
8 Jun
1/ there is now over $100B of dollars on-chain

there are seven stablecoins with >$1B in market cap

while market cap is an important metric, there are a few other insights we can glean from looking at velocity and collateralization rates

a short thread 👇 on crypto dollars
2/ velocity is the rate at which money is exchanged in a financial system

high velocity money tends to be associated with more developed systems

$USDT is HIGH velocity with one tether changing hands more than 1.5x per day

the USDT/BTC trade pair is *BY FAR* the highest volume
3/ some stablecoins have virtually no velocity, meaning once issued, their use as a medium for exchange is very limited

notably UST (trueUSD) and TUSD (terra USD) are the lowest velocity - this will be an interesting area to explore further
Read 6 tweets
Meltem Demir◎rs Profile picture
28 May
1/ excited to launch the Pleb Mining Council

individuals have always been the backbone of the bitcoin network

the bitcoin network has 150,000 petahashes of compute.

0.15% of global hash rate, or ~220 PH, is run by plebs. help us take it to 5%!

compassmining.io/education/pleb Image
2/ our relationship w/ @compass_mining is driven by getting more individuals into mining bitcoin, and distributing global hash rate more broadly

we thought it would be fun, educational, and timely to create a Pleb Mining Council to help drive this effort

POWER TO THE PLEBS!
3/ since starting my self-mining experiment w Compass a few months ago, *so* many of you have reached out to me about your desire to learn more about mining

see my experience below, month 4 update coming shortly 👇

Read 6 tweets
Meltem Demir◎rs Profile picture
18 May
1/ "at @CoinSharesCo, we use data to inform our perspective of the #bitcoin market"

thanks to @CNBC for having me and @jillruthcarlson on. let me just drop some facts here so we can stop talking about elon & other trivial BS and focus on FACTS

📹👇🏾
cnbc.com/video/2021/05/…
2/ over the last few weeks, BTC option skew was relatively bearish.

in #bitcoin, the tail (ie futures / options) wags the dog. this past week, we saw BTC spot prices drift lower, which proved options skews to be right.

TL;DR - traders were bearish

h/t @GenesisVol for data
3/ let's zoom out

in the last five months, bitcoin more than tripled its prior 2017 all time high of 20k, hitting 65k at one point.

ethereum has yet to triple its 2018 all time high of 1400, and is currently trading around 3400

traders are positioned to capture $ETH upside!
Read 12 tweets
Meltem Demir◎rs Profile picture
5 May
1/ time for my monthly #Bitcoin mining update 🚀

i'm 90 days into my experiment, and i've mined 0.05 bitcoin.

let's run the numbers, fam 👋🏾

(i use @compass_mining to source hardware + manage ops, but make this report myself) Image
2/ in case you missed it, last months update covered each line item in great detail. i'll keep this update a little shorter since many of the line items haven't changed much.

3/ bitcoin mined - 86% of bitcoin mined to date is block rewards, 14% is transaction fees (up from 12% last month)

hardware - the market for mining equipment continues to be incredibly supply constrained, semiconductor shortages are everywhere in crypto compute
Read 7 tweets
Meltem Demir◎rs Profile picture
1 May
1/ USD stablecoins will soon hit $100B in market cap, and make up 4% of the crypto market

let's take a closer look

despite making up only 64% of the stablecoin market, tether dominates daily trading volume, with >90% of daily traded volume
2/ this chart tells a very clear story.

rumors of tether's demise are overstated. it is *the* dominant trade pair, which drives its staggering daily turnover.

bUSD is the only close competitor, b/c its @binance's preferred trade pair that they push to millions of traders.
3/ while market cap is an impressive number, its a poor measure of adoption.

the number that we should be focused on is daily traded volume and velocity, which is driven by the integration of stables into market structure via trade pairs.

this is *utility*
Read 6 tweets
Meltem Demir◎rs Profile picture
16 Apr
1/ "why is $DOGE pumping?"

pull up a chair, my friends, the answer is in plain sight

DOGE is up 500% over the last 7 days and is now $48B in market cap, making it the fifth largest cryptocurrency by market cap.

but why?

let's look at r/WallStreetBets
2/ on wednesday, ahead of the $COIN listing, the WSB mods changed their ban on crypto discussion to allow talk about 3 cryptocurrencies - #Bitcoin , ethereum, and... you guessed it... $DOGE

as you can imagine, the WSB community went wild
3/ not 24 hours later, the mods reverse that decision and announced they would ban all crypto chatter on the forum indefinitely

according to some reports, the ban was a response to this @business article claiming WSB mods were bowing to pressure

bloomberg.com/news/articles/…
Read 7 tweets

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