At this time when BTC has reached a new high, the epic 6-month high consolidation period is about to come to an end, we believe it is necessary to share our views with you. As mentioned in our previous monthly report, 6 months is enough time to confirm a trend that lasts for years. This article is based on the observations of the industry made by the manager in the primary and secondary markets over the past 6 months, and has a strong subjective component, and will attempt to guide our future crypto asset management thinking. The core idea of this article can be summarized in one sentence:
The asset property of BTC has undergone a new qualitative change in the past 6 months, and the old and new main capital have completed the handover of pricing power. A new capital pool that takes BTC as the core asset, ETF and US stocks as the capital inflow channel, and uses US-listed companies represented by MSTR as the carrier to infinitely absorb US dollar liquidity has officially started.
BTC has become the most core US dollar asset outside the US dollar industry cycle (such as AI) leaders, and the long-term low-volatility upward trend has basically taken shape.
However, the decoupling trend between the traditional digital currency market (Altcoins) and BTC will continue to strengthen.
I. BTC has completed the establishment of a fundamental turning point in the consolidation
BTC has found a clear definition of its own asset properties
This is something that everyone may have overlooked, but in our view, it is particularly important. This definition can be led by BlackRock, but it needs the affirmation of the entire US dollar capital system to be established, which was something no one expected in the past. However, over the past 6 months, we have enough evidence to confirm:
BTC is an alternative reserve asset that can hedge against US dollar debt risk and is outside the traditional financial framework.
This concise definition has provided the most important basis for BTC to become the center of the future US dollar asset system. The US debt problem has become the elephant in the room and will be a core issue in the US fiscal and monetary system in the long run.
Against the backdrop of the current Trump administration, if the policy direction becomes more radical again, we may witness further significant fluctuations in US debt and the US dollar exchange rate in the next three years. We believe that the US debt problem is one of the biggest themes of the past 10 years in the context of the shrinking global influence of the US dollar.
More importantly, whether the above concept is accepted by the market is also the issue we have been most concerned about in recent months. At this moment, facing the unexpectedly large government of Trump, we have finally observed enough evidence that a sufficient number of giant Hedge Funds (1B+) founders have begun to publicly express their attitudes, including but not limited to Paul Tudor Jones, Verde Asset Management, Brevan Howard, Millennium Management, Schonfeld Strategic Advisors and other hundreds of billions of US dollar-level veteran Hedge Funds using BTC as a hedging tool in their US debt risk trades (especially in the recent election).
The new Ponzi model of BTC has been established in the past 6 months
Since the approval of the ETF, the new BTC Ponzi model led by BlackRock has taken shape, with BlackRock-controlled ETFs and Microstrategy, in which BlackRock is the second largest shareholder, as the infinite buyer and locker, with the core essence being the overall low volatility and upward trend of BTC, using the stock price effect of MSTR to create the possibility of BTC as a market capitalization management tool and open up the future passive buying of US stock ETFs, forming a BTC Ponzi model that can achieve infinite self-reinforcement.
We believe that the establishment and long-term infinite circulation of the above model in the medium term (3-5 years) is premised on:
1. Reduction of BTC volatility;
2. US dollar liquidity can maintain the average growth rate since 2008;
3. BTC price can achieve annual growth, the proportion is not important.
And the following important facts have already occurred:
1. BTC volatility has approached historical lows;
2. Excluding arbitrage factors, the total market value of BTC held by BTC ETFs (including GBTC) and Microstrategy has exceeded **$90 billion**. Its holdings correspond to the current daily average spot (including various ETFs) trading volume of the entire network (actually effective about **$100 billion** in the current bull market peak environment), has actually reached the so-called cornering threshold, and over the past 6 months, we have felt the further concentration of liquidity to CME and the New York Stock Exchange, which also corroborates the control of the above system over the current BTC supply and demand;
3. BlackRock has and fully has the long-term ability to ensure the refinancing capability of MSTR's equity, continuously promoting MSTR to play the role of the ballast stone of BTC volatility through the use of short-term equity financing tools.
In summary, this infinite perpetual motion machine is likely to become the best capital pool game in the next 2-3 years as US dollar liquidity easing is just beginning, and **it is only a matter of time before the total value of BTC held by the BlackRock system exceeds the holdings of gold ETFs**.
Finally, a simple explanation of the observation method of the turning point of the above capital pool, mainly the reverse deduction of the core conditions mentioned above:
1. BTC volatility, especially the downward volatility, begins to amplify;
2. US dollar liquidity reaches a turning point;
3. MSTR encounters difficulties in refinancing its equity, unable to complete the current 3-year $42 billion refinancing plan, and based on this logic, it is predicted that **the MSTR stock price will peak ahead of the BTC price**.
II. The manager's outlook on the trend of BTC in the next 5 years
Based on the above, the manager believes that the key points to grasp for the trend of BTC in the next 5 years are:
1. The current is a real turning point of US dollar liquidity, and the right-wing US government led by the Republican Party will further ensure that US dollar liquidity will be more relaxed than expected;
2. From the current BTC daily trading volume and MSTR stock price performance/market value, the current capital size is still in the early stage and is far from the turning point;
3. Under the first two premises, the on-chain chips are still flowing out like the tide, and the epic turnover of the old and new chips has actually been completed in the sideways consolidation around the new highs in the past 6 months.
Therefore, we firmly believe that the new round of major asset cycle of BTC is just beginning, and in terms of asset management, we will accompany you to enjoy the long-cycle low-volatility upward experience of the core US stock assets based on the above understanding and actual market trading signals.
