The Coming Short Squeeze in Crypto and Catalysts

hey everyone me kevin here we've gotta

talk about

crypto because uh lately it's been going

through a little bit of a

cyclical period of fun and now this

happens with cryptocurrencies

sometimes they're really hot like they

were between december and

well pretty much up to about four weeks

ago and then sometimes they're not super

hot

one of the things in addition to some of

the new crazy things going on that we're

gonna talk about in this video such as

what the treasury department's doing

uh and some of the other things going on

with shorts and that one of the things

to remember when it comes to

cryptocurrencies

is that they are cyclical but it's it's

not just cryptocurrencies that are

cyclical

meaning they go up and down depending on

people's moods and the cycle of those

moods

but they really just do what all other

sectors in the stock market do

we know tesla's hot for three months at

a time and then it's not

we know that sometimes you get

industrials that are really really hot

everybody's investing in john deere and

caterpillar that works really well for

certain periods of time

and then other periods of time it's

pharma and

more recently it's been momentum which

i'll tell you momentum is probably by

far

the most fun to be a part of because the

community and the momentum community

are really really strong i actually

think a lot of the folks in the momentum

community are the same folks in the

crypto community and crypto sometimes

almost becomes a version of momentum

really great sort of world we've got and

great community

i really see uh momentum and uh crypto

as the definition of retail

although lately institutional investors

have made up over 60

of trading volumes especially in larger

cryptocurrencies like bitcoin and

ethereum

but here's the thing even though a lot

of cryptos lately have been selling down

we got to keep this in mind when we look

at bitcoin for example we're up 282

percent

year over year we're up 5 700

in the last five years so you know a

little bit of a decline here

you sure we're off all-time highs by

maybe somewhere around 45

48 hey it happens cyclical

not as bad as it could be and there are

lower support levels we could still test

we could support or we could

if we break through in my opinion on

bitcoin for example that 31 000

support that's not gonna be great

because the next support level is like

21 000

but the good news is there's a lot of

clarity coming to cryptocurrency within

the next

sixish months here's what i mean by that

we know that a lot of

investors who love bitcoin are waiting

for more companies to adopt

cryptocurrencies

or at least some portion of them on

their balance sheets for example kathy

wood at arc invest suggests hey if every

company in the s p 500 just had one

percent

of their treasuries their cash on hand

essentially in

a bitcoin bitcoin should be four hundred

thousand dollars in value which is

incredible and

i think one day will will happen when

that's a big question

but right now a lot of companies still

aren't exactly sure

what the details of regulation are going

to look like and we know that regulation

is coming

not only do we suspect that it's coming

we know it's coming but we also have

some dates

take a listen to this the treasury

financial crimes enforcement department

is issuing new anti-money laundering

rules and

finalizing these rules in the fall

these current proposals from the

treasury department could require

tax reporting or just reporting to the

government any transactions

as low as three thousand dollars within

the united states

and as low as 250 dollars

internationally

now initially we might think oh my gosh

like this is overbearing

but quite frankly what would be

overbearing would be obeying

cryptocurrencies like some countries

like iran are doing or banning

uh crypto mining or banning crypto

transactions in china or whatever

those are bigger concerns reporting for

transactions

three thousand dollars in the u.s you

know that would be down obviously from

ten thousand dollars where we stand now

and two hundred fifty dollars

internationally okay you know it's it's

not as

simple and loose but if that's how tight

they're gonna tighten the screws on us

it's not bad might be bad for some

criminals but not bad for the vast

majority of us

and really we expect not only these

rules to sort of be finalized by the end

of fall but we expect them to be fully

submitted and into effect

by the end of the year this actually

creates a catalyst point for us

as an investor i'm regularly looking for

catalyst points and mostly i'm looking

for inflection

points inflection points in my opinion

are the best time to invest this is when

a new trend is beginning and people

don't see that new trend yet

because when when markets inflect so

i'll give you an easy example here okay

when when the real estate market

inflected in the summer of 2012

i'm sorry 2018 nobody believed me

when i was first saying the real estate

market is about to tank like i'm seeing

it

i'm one of the first people to see it

it's a big problem because i'm out here

on the field and i'm really nervous

about it it's happening

it's starting i see the numbers it's

starting

i was in it every single day

watching it and when i alerted first

nobody cared but i saw the inflection

point

within six weeks real estate prices had

fallen 12

and that's when federal reserve chairman

jerome powell started cranking rates and

rates shot up like one percent in real

estate

which makes sense but it was incredible

and so it's these inflection points that

you want to identify earlier

and catalyst points such as these laws

passing and that uncertainty being gone

are important

it's kind of like when we invested right

before the election we didn't know what

the outcome of the election would be but

we knew there was a lot of

uncertainty going into the election but

what goes away after an election is

uncertainty and people like certainty no

matter what the outcome is people like

certainty

so i believe that come fall towards the

end of the year we could have a big

potential catalyst for resuming a crypto

run

excuse me and this is also going to be

combined with some short-term issues

between now and then for example shorts

shot up again over the last three days

in bitcoin at least according to

datamesh

which measures activity on binance

shorts are up substantially again

they doubled from four days ago there's

a lot of shorting happening in

cryptocurrencies right now

and it's really just the same hedgies

and the shorts that were shorting

uh other assets like attack and consumer

discretionary

earlier that are now shorting

cryptocurrencies so this is going to

add to short-term pain so the next six

months while we wait for new rules while

we while the shorting happens

more pain more pain more pain but

another good catalyst that's coming

there's actually an article this morning

uh in cnbc about this

and we've heard this before that in the

future there'll be a digital dollar

uh like a central bank digital currency

a cbdc is what they're called

and a lot of folks are like okay yeah

yeah whatever most people don't consider

that

as meaning anything nobody really cares

about a federal reserve coin or a fed

coin or whatever

but we actually should because when we

have a fed coin and we start

legitimizing what a digital dollar is

and people start realizing that wait a

minute a digital dollar is different

than just digital numbers of my regular

paper dollars in my bank account

when people start realizing wait a

minute there's actually a difference

there

well first of all hopefully they'll take

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but i think what will happen is people

will warm up to the idea of wait a

minute the fed's doing it if we have

that regulation in place and this is

actually a safe thing we don't have to

be as concerned

about uh digital dollars or or things

that are pegged to the dollar like usdc

then that could lead more people to

actually get into cryptocurrencies in

the first place

and invest in some of the top tier

investments in the crypto space

which right now the top two are

obviously bitcoin and ethereum and i

think they'll benefit substantially

when we start getting more people who

today are like cryptos i don't trust

cryptos

and they actually start becoming

believers because the fed is doing it

and the government's doing it

and then then we'll see it as an

innovation rather than as

you know i mean like even the word

crypto it feels like like

underworldish to people who are very not

knowledgeable

when reality is it's the most

transparent and secure form of

of transacting that we've ever had

before in our lifetimes so anyway

the problem is we have to go through

this transition uh

and it's not just the transition of

treasury department rules it's not just

a transition to getting people familiar

with the digital dollar

it's not just the transition of getting

away from the short sellers but it's

also surviving this uh transition and

period of additional and increased

volatility because as inflation

expectations

potentially go down uh there is

potentially more selling pressure that

we might see on some cryptos

not all i i would venture to say 20 to

45 percent of people

like cryptos as a hedge to inflation uh

maybe it's less maybe it's

more i i don't know i ran a twitter poll

and it was somewhere around

a third of y'all uh based on my memory

of somewhere around a third of you all

invest in crypto

as an inflation hedge but then again i

also have a little bit of a biased

audience so that's why i think this

range is probably more appropriate

but look as inflation and flex downward

we might see less people uh potentially

use kryptos as an inflation hedge and

that could create some additional

downward press pressure so i would say

the next six months i and i don't know

this with certainty right i mean maybe

watch tomorrow crypto skyrocket so it's

like people are gonna leave all those

comments oh this video didn't age well

whatever you know i'm always just gonna

tell you what i believe and i'm i'm

not trying to flood either i'm very

optimistic and i'm

diamond handing my cryptocurrencies i've

got over 300

000 in cryptocurrencies and i'm diamond

handing these i just want you to know

that i believe we're going to have these

big catalysts

that are going to be very very positive

additionally positive

for cryptocurrencies when we finally get

the final a treasury department's

financial crimes enforcement development

rules out

towards the end of the year when we

finally get the short rotation to end

when we finally get away from this

volatility based on inflation or caused

by inflation

and when we finally escape uh a a

transition

to a more transparent and green

cryptocurrency uh environment where

maybe the north american bitcoin council

finally gets us

much more green uh than we currently are

we we know that statistics are a little

skewed with oh seventy percent of

cryptocurrencies use renewable

yeah but not for all of their crypto

mining right so there's a lot of work to

be done

anyway that's my thought for right now

thank you so very much for watching

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and folks we'll see in the next video

bye