There are green shoots. We swear

Good morning! Welcome to The Daily Moon. It’s the end of the week. Are you excited? Well, not as much as the people of El Salvador. The country has declared it will buy 1 Bitcoin a day. The reason seems to be that it will buy the dip. Gotta keep an eye on this one.

The markets were cautious. Bitcoin was at $16,500 while Ethereum slipped below $1,200. Nasdaq fell in early trade. Back home, Sensex and Nifty ended lower on weak global cues.

Bitcoin On The Back Foot

Just about 15 days ago, Bitcoin found a new level at $20,000. But the excitement was short-lived. Sam Bankman-Fried backed FTX and Alameda ran out of cash in the past week. Bitcoin has struggled since then.

What happened?Remember we told you that BTC isn’t bothered about the stock markets anymore? That made it immune to market volatilities. However, BTC wasn’t able to detach from crypto shocks. So when FTX went bankrupt, BTC slid. From $20,000, it fell to $18,000 and quickly dropped below $16,000. BTC is affected because:

1. SBF’s financial crisis has spread across crypto. BlockFi has prepped for bankruptcy. Salt Lending and Liquid Global have paused withdrawals.

2. There’s FUD. Even exchanges with no FTX ties have seen BTC withdrawals.

3. Tokens such as Solana and USDC have links to SBF’s businesses through loans and investments. If he can’t repay, everyone suffers.

Some greens, please?HODLers continue to HODL. Glassnode data shows that 25.8% of BTC supply has been held for at least five years, an all-time high. The logical reason is also that BTC is up 153% from the ~$6,500 levels five years back. Yes, about 48,100 BTC was spent in the past seven days. But investor belief isn’t lost yet.

More bright spotsBitcoin Futures have performed well in a bear market because their exposure to BTC is indirect. Institutions have short Bitcoin, meaning they’ve bet on prices to fall further. It’s not bad for crypto, because that’s brought in more capital.

Tether’s Not With Them

Tether claims it is safe. It has zero exposure to Genesis or Gemini Earn. Genesis’ crypto-lending arm and Gemini Earn paused withdrawals on Wednesday. But the stablecoin isn’t connected to this crisis, it seems.

Real reserves only We’ve seen it in the past. Tether’s been rather sketchy about its reserves and got serious only after courts nudged it. Now the stablecoin issuer maintains that it is different. It clarified that Tether tokens:

• Are 100% backed by reserves

• Assets exceed liabilities, meaning its financials are intact.

Tether’s reserves include cash and bonds. It promises to safeguard this pool, especially during crisis situations. We’ve heard these stories before.

But why now?This didn’t come out of the blue. Tether lost its peg against the US dollar last week. While it’s back to the $1 level, the market is anxious. Nobody wants a Terra repeat.

Nvidia’s Breaking Out

Nvidia’s love for crypto is over. The chipmaker said that it doesn’t expect blockchain to be an important part of its business going forward.

Falling demandNvidia was reporting third-quarter results. Gaming revenue was down by 51%. This was partly because of a fall in consumer demand, and partly because of Ethereum moving to a proof-of-stake model. There is a clear move away from crypto. Remember, this is a company that was so bullish on crypto that it even launched a crypto-focused chip last year.

Looking at greener pasturesNvidia’s revenue came in above what the market was expecting, after at least two-quarters of missing projections. This was helped by increasing cloud adoption and higher demand for its data centre business. It expects the next quarter's revenue to be $6 billion, down from $7.6 billion a year before. But the focus, it seems, will be enterprise clients instead.

Voyager At Sea Again

There’s no smooth sailing for Voyager Digital. The bankrupt crypto lender is looking for buyers. Again. Before you guess, we can confirm that this story involves FTX, too. Sigh.

What’s up here?Well, FTX was going to buy Voyager. Out of bankruptcy. Now that FTX is bankrupt, who buys Voyager? FTX is saying Voyager can pursue other bids, but the most confused are its users.

Voyager’s bankruptcy attorney said at a hearing that the lender was “shocked, disgruntled, dismayed,” and will obviously not go ahead with the FTX deal. Duh.

ICYMI FTX had won the bid earlier against Wave Financial and Binance. Now Wave Financial and CrossTower are also said to be in the running.

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