The Ultimate Rebound Machine

1. mkt movements

btc saw a 2nd consecutive + mnthly close for aug, up +13% for the mnth. eth was up an even + impressive +31% in aug onna back offa resurgence in demand for non-fungible tokens (nfts).

equities (+3%) na us usd (+0.7%) were up for aug (+2–4%), with long-dated us bonds (-0.5%) and gold (-0.2%) slitely down.

table 1: price comparison: btc, eth, gold, us equities, long-dated us treasuries, us usd (% change)

as we discussed last mnth, government is arguably the last remaining major investor category missing from btc’s incredible quest to becoming a new global reserve $.

the launch of btc as legal tender in el salvador on tue, alongside el salvador becoming the 1st ever government to announce an investment in btc, appears to ‘ve been a key catalyst behind btc climbing back above $52,000 on sept. 6th.

the flash crash crp mkts subsequently suffered on tue sept. 7th came as leveraged borrowing climbed and excessive exuberance returned to crp futures mkts, leading to rapid liquidation of speculative positions.

looking ahead, perhaps the key ? surrounding the outlook for crp mkts ‘oer the nxt several mnths is whether recent primordial crp demand drivers including:

will counterbalance some uncertain regulatory developments round several key crp growth categories:

2. on-chn analysis

each mnth we dive into on-chn data to explore interesting trends or movements onna btc network.

overall, on-chn activity increased inna mnth of aug (table 2).

the μ daily fees continue to drop from $4 / transaction to $2 / transaction. this trend has continued since may 2021.

table 2: aug vs jul network activity

one topic we continue to follo closely is the evolving btc mining landscape inna wake of the may-jun crp mining crackdown in china.

it appears from anecdotal reprts and official announcements dat a' very significant share of crp mining previously conducted in china has either relocated outside china or gone offline.

however, we're skeptical of claims that chinese authorities were successful in eliminating all btc mining in china.

indeed, we see evidence that some large mining pools thought to include a very significant share of china-based miners, s'as antpool, ‘ve seen their mkt share maintained or even increase of l8 in spite of china’s mining crackdown (fig 1).

some mining analysts ‘ve quietly estimated as much as 30% of the pre-crackdown asics (crp mining computing hardware) to be still either operating in china or w8in to come back online after the chinese regulatory heat has cooled.

fig 1: antpool has seen a mkt share increase despite china’s mining crackdown


3. wha’ we’re reading, hearing, and watching.


beyond crp

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