{"id":2705,"date":"2024-08-26T13:43:26","date_gmt":"2024-08-26T11:43:26","guid":{"rendered":"https:\/\/www.mereau-finance.com\/letter\/lettre-n40-un-marche-haussier-en-deux-phases-pivot-politique-sur-la-crypto-au-us\/"},"modified":"2026-09-10T15:31:49","modified_gmt":"2026-09-10T13:31:49","slug":"newsletter-40-a-two-phase-bull-market-political-pivot-on-crypto-in-the-us","status":"publish","type":"letter","link":"https:\/\/www.mereau-finance.com\/en\/letter\/lettre-n40-un-marche-haussier-en-deux-phases-pivot-politique-sur-la-crypto-au-us\/","title":{"rendered":"Letter No. 40: A two-phase bull market?; Political pivot on crypto in the US."},"content":{"rendered":"

The objective of this letter on a potential two-phase bull market?<\/span> is to inform you about the current state of the crypto-asset market as well as recent news in this field. This letter is not investment advice, but merely a sharing of my personal point of view.<\/p>\n\n\n\n

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News<\/h2>\n\n\n\n
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Goldman Sachs acquires $420 million in spot Bitcoin ETFs.<\/a> Goldman Sachs has taken a significant step toward Bitcoin adoption by investing $420 million in spot Bitcoin ETFs. This initiative shows that Bitcoin continues to gain ground, even within the most established financial institutions, thereby reinforcing its large-scale adoption.<\/p>\n\n\n\n

\u2013<\/p>\n\n\n\n

Coinbase is preparing to launch a Wrapped Bitcoin (WBTC) competitor \u2013 What are the stakes of such a token?<\/a> While BitGo struggles to maintain Wrapped Bitcoin (WBTC), Coinbase is preparing to launch a competitor, cbBTC. This initiative could strengthen Coinbase's dominance in the Bitcoin ecosystem, raising concerns about market balance.<\/p>\n\n\n\n

\u2013<\/p>\n\n\n\n

BlackRock now owns more cryptocurrencies than Grayscale.<\/a> BlackRock surpasses Grayscale in cryptocurrency holdings, thereby becoming the largest asset manager in the sector. This marks a turning point in the cryptocurrency investment landscape, consolidating BlackRock's dominant position in global markets.<\/p>\n\n\n\n

\u2013<\/p>\n\n\n\n

Paying in USDC via the iPhone: soon a reality?<\/a> Under heavy pressure from European Union regulators, Apple had no choice but to allow third-party providers to utilize tap-to-pay. Circle, the company behind USDC, will enable iPhone users to use this technology to make purchases with its stablecoin.<\/p>\n\n\n\n

\u2013<\/p>\n\n\n\n

The Swiss and Norwegian central banks reportedly hold 3,400 Bitcoins through MicroStrategy shares<\/a>. MicroStrategy's Q2 2024 results reveal that the Swiss and Norwegian central banks bought MSTR shares, gaining indirect exposure to Bitcoin. Could this move signal a strategic shift toward cryptocurrencies, or is it simply a traditional investment strategy?<\/p>\n\n\n\n

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Fundamental Analysis<\/h2>\n\n\n\n
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Bitcoin's price over the last six years in euros and on a logarithmic scale.
Source : https:\/\/www.coingecko.com\/fr<\/a><\/figcaption><\/figure>\n\n\n\n
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Letter No. 40: A two-phase bull market?; Political pivot on crypto in the US.<\/h1>\n\n\n\n
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At the time of writing, the price of Bitcoin is 64,539 $ (on 08\/20\/24).<\/p>\n\n\n\n

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A two-phase bull market?<\/h3>\n\n\n\n
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The realized profit-to-loss ratio for long-term holders is an indicator we can use to analyze the cyclical behavior of this cohort. Although this metric is down significantly from its peak, it still remains at a high level. This suggests that long-term investors are slowing down their profit-taking.<\/p>\n\n\n\n

It is interesting to note that during the all-time high (ATH) of March 2024, this metric reached a level comparable to previous market peaks. During the 2013 and 2021 cycles, the metric had dropped to similar levels before rising again, leading to a two-phase bull market. However, in 2017-2018, this decline persisted in a bear market context, marked by dominant losses.<\/p>\n\n\n\n

The question is whether we are currently in a cycle similar to those of 2013 and 2021, that is, a two-phase bull market, or rather to that of 2017-2018, a single-phase market. Given the buying strength of long-term holders and the fact that prices have not significantly surpassed the peaks of the previous cycle, it seems more likely that we are in a two-phase cycle, like those of 2013 and 2021.<\/p>\n\n\n\n

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Realized profits and losses by long-term holders
Glassnode<\/figcaption><\/figure>\n\n\n\n
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On the chart below, we can observe the two-phase bull market of 2021, with two distinct red \u00abwaves\u00bb on the far left. For the current cycle, a first \u00abwave\u00bb has been completed, and we are now at an equilibrium point. The market will have to choose between a sharp decline, leading to a bear market similar to 2017-2018, or a second bullish wave, like in the previous cycle. Personally, I lean more toward the second, bullish option.<\/p>\n\n\n\n

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Comparison between buy-side and sell-side on exchanges for major assets. Source: Glassnode<\/figcaption><\/figure>\n\n\n\n
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The political pivot on crypto in the US<\/h3>\n\n\n\n
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Within the space of a few weeks, a major political pivot on crypto took place in the United States. Two of the three presidential candidates, as well as several senators and members of the House of Representatives, have expressed their support for the crypto ecosystem. This sudden shift allows the United States to regain the upper hand in this new technology, with the ambition of dominating this ecosystem in the future.<\/p>\n\n\n\n

During a speech at a major Bitcoin event in Nashville, US, presidential candidate Donald Trump presented about ten key points regarding Bitcoin:<\/p>\n\n\n\n

1. Bitcoin is a \u00abtechnological marvel\u00bb<\/strong><\/p>\n\n\n\n

2 <\/strong>. <\/strong>Bitcoin could surpass gold<\/strong><\/p>\n\n\n\n

3. Trump\u2019s \u00abAmerica First\u00bb approach<\/strong><\/p>\n\n\n\n

4. Make America the global crypto leader<\/strong><\/p>\n\n\n\n

5. Pro-crypto policies and the halt of \u00abOperation Choke Point 2.0\u00bb<\/strong><\/p>\n\n\n\n

6. A new presidential advisory council on cryptography<\/strong><\/p>\n\n\n\n

7. Regulatory Clarity for Stablecoins<\/strong><\/p>\n\n\n\n

8. Bitcoin is not a threat to the US dollar<\/strong><\/p>\n\n\n\n

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These key points show that the topic of crypto is now unavoidable for politicians. It is more advantageous for them to support this ecosystem rather than oppose it, given the large number of people who use this technology.<\/p>\n\n\n\n

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A return to HODLing<\/h3>\n\n\n\n
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In recent months, a certain uncertainty and indecision has been perceptible among digital asset investors. However, looking at investor response to these unstable market conditions, a trend toward HODLing seems to be emerging.<\/p>\n\n\n\n

Since Bitcoin's ATH reached in March, the market has gone through a long period of distribution, involving wallets of all sizes. In recent weeks, we have observed the first signs of a reversal of this trend, particularly among the largest wallets, often associated with ETFs. These large wallets now appear to be adopting an accumulation strategy.<\/p>\n\n\n\n

This likely suggests that we are in a two-phase bull market, as this type of behavior is not typical of a single-phase cycle.<\/p>\n\n\n\n

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Investor cohort accumulation score. Source: Glassnode<\/figcaption><\/figure>\n\n\n\n
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Our service<\/strong><\/h2>\n\n\n\n
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