#Crypto: BTC, DeFi & Your Altcoin of the Week
Another 2022 crypto prediction? ✅
I’m out the next two weeks but wanted to send you this:
BREAKING: Madeira to adopt #Bitcoin 🙌
"I believe in the future and I believe in Bitcoin!" – President of Madeira pic.twitter.com/tIm30YXA4q
— Bitcoin Magazine (@BitcoinMagazine) April 7, 2022
BREAKING: Mexican senator Indira Kempis to propose legislation to make #bitcoin legal tender in Mexico 🇲🇽
— Bitcoin Magazine (@BitcoinMagazine) April 7, 2022
In my prediction, I called that three more countries would adopt bitcoin (BTC) as legal tender.
It’s happening! And that’s great for the cryptoverse.
Bitcoin has huge demand that will continue to grow in the future.
But there are lesser-known altcoin gems that are disrupting markets too. Click here to see the full story now…
There’s one I told you about recently.
The best thing about the internet is that photos, blog posts, videos and general data live on there forever, right?
Well, not quite.
Data is actually deleted every day from the internet.
But why does this matter?
Last week I shared an innovative crypto project that solves internet data storage issues.
It’s called: Arweave (AR).
Check out the full story about how our America 2.0 mega trend, blockchain is solving this America 1.0 data storage problem with AR below…
The beauty of blockchain? It’s transparent. You can see what’s happening in real time.
And I’ll show you that some big bitcoin buying action is happening now. It’s a great signal for demand.
And I think we just saw the first domino to fall for more DeFi adoption — a merge between traditional finance and decentralized finance.
I’m going to break it all down for you: BTC, ETH and, of course, my altcoin of the week. (Thanks to Levi for asking about this altcoin!)
I’ve been watching it for a while, but I found something shocking when I started researching it more for this video.
Get the full scoop in my new IanCast Crypto Corner + answers to your questions:
Hey everyone, welcome to this week’s IanCast. This is week number two of the new format. If you missed the video last week, it’s mostly just going to be me in these videos going forward. Of course I will still have Paul on these videos from time to time as a guest.
I will have other people from our team on as guests from time to time too. For the most part, it’s going to be me. I’m still going to talk about growth stocks, crypto and I’m going to add a section at the end that’s about a specific alt coin every week.
I think a lot of people are interested in that based on the comments of the last video. A lot of people seemed to be engaged with that part of the video. I love researching alt coins. I want to give as much good information on them as I can.
I’m not going to get too into stocks this week. I put out a video on pot stocks yesterday. Basically, I think they are way undervalued and I go into a lot of detail of why. If you haven’t watched that one, check it out. I think there’s a lot of good information in there.
Big Buys Happening in Bitcoin!
I’m going to get started this week talking about crypto.
With Bitcoin (BTC), the CEO of the Luna Foundation Guard, which is a foundation that holds a treasury for the terrablock chain. He’s been buying BTC like crazy to back their stable coin.
We can actually see the wallet they are buying their BTC with. That’s the beauty of crypto. Everything is very transparent. You can actually see what is going on in real time. I thought I would give everybody a glimpse of what is going on there. It’s actually really cool.
He started buying back here on the 21st of March. There was actually already about 9,500 BTC in the wallet. Since then, just within the past 10 days, he has bought about 21,000 BTC. It started at 9,500 and went up to almost 31,000.
I’m recording this on Thursday and the most recent buy was yesterday at 4:35 in the morning. They’ve been adding BTC regularly. Pretty much every day buying thousands of BTC. This is a good signal for demand. I think it has to do with the recent pump we’ve seen in BTC.
I know it was down today, but this is to be expected when you see a big surge in prices. Even if we’re coming off low prices it’s not going to go up in a straight line. I think the supply demand dynamics of BTC is still insanely bullish.
We can see the amount of BTC that’s been sitting in wallets unmoved for more than a year is now over 63% of the supply, which is basically right around the all-time high. It hit that right before it went on this big surge in 2020. A lot of BTC is locked up and being held for the long term by people who are not going to sell anytime soon.
They are not going to sell at these low prices. Typically the people who hold on for years only sell when the price goes parabolic. We saw that at the end of 2020 toward 2021. This line is the supply that went down as demand went parabolic. Same thing back here in 2016 and 2017.
A lot of people who had been holding BTC for years dumped it. They sold into that huge liquidity and momentum surge because that’s the easiest time to sell. When things are going up in a straight line you know there’s going to be a buyer. That’s the trend we have seen.
I don’t expect these long-term holders to sell until there’s a surge in demand. That can happen at any time. I think this situation with the Luna Foundation Guard is super bullish. We also have MicroStrategy and Michael Saylor taking out a loan against their BTC.
They took out $205 million in cash and they are going to use that to buy BTC too. That’s hundreds of millions of dollars more going into BTC. If we go back to that wallet, you can see there’s a balance of almost $1.5 billion in the wallet.
I believe the goal was to get $10 billion worth of BTC in the wallet to back the US Terra stable coin. There’s still a long way to go, They are still planning to buy billions of dollars’ worth. I think that’s going to be a huge catalyst for price going forward, similar to what Grayscale did throughout 2020.
They were buying BTC like crazy because there was demand from high-net-worth individuals or institutions that chose Grayscale to hold their BTC for them and keep it safe. I think this is the start of another demand surge. Grayscale bought more than 3% of the entire supply within a year period or maybe less than that.
We are seeing something similar start to build up with the Luna Foundation Guard. I think it’s likely other crypto projects and DAOS are going to be adding BTC to their treasury. It’s the most decentralized. It’s the least risky of the crypto assets because of the decentralization and mass adoption.
I think this could be the first domino to fall in DeFi, these DAOs adding BTC to their treasury.
What’s One Of The Biggest DAOs Out There?
Another thing I wanted to talk about with crypto is Maker DAO. It’s one of the biggest DAOs out there.
They have a coin, MKR. They are on Ethereum. They are the ones that issue the Dai stable coin. I think there’s more than $10 billion of Dai outstanding right now.
They are like a central bank in a sense where they have a treasury that backs the stable coin they issue. I think it’s maybe the fourth or fifth biggest stable coin by market cap at this point. It’s a pretty big deal here because a traditional bank submitted an application to use their own loan as collateral to back the issuance of more Dai.
It’s the first time this has ever happened. This is an old bank, founded in 1871. Nothing like this has happened to this point. This is an important thing. It’s the first sign of a merge between traditional finance and decentralized finance. It further legitimizes DeFi.
A lot of people still see it as risky and confusing and something they are not sure they want to be part of. If we get more banks like this using DeFi and submitting collateral to it, I think that’s going to be a big thing. I think that’s likely. Maker DAO is probably the most reputable DeFi coin out there.
I know it’s the oldest. It was one of the few coins that held up well during the 2018 crypto crash. It’s done well with the Dai issuance so far.
They want to put $100 million in the Maker DAO treasury with a 12-month goal of up to $1 billion. That’s some serious money from an older traditional bank going into DeFi.
To me, that shows there’s a real trust building between traditional banks, institutions and DeFi. So that was a really big thing in my opinion. One of the biggest to happen in DeFi in the recent past.
I figured this would be cool to show just out of curiosity.
The things that back the Dai stable coin currently: A lot of ETH, USDC, then others. There are some alt coins too. Maker DAO puts a ton of money into the treasury and they create a lower amount of Dai.
Dai is way over collateralized. It’s good for its safety. If the coins that back it fall in price, there’s not a significant trouble posed to the actual stable coin. Collateral wise, you can see there are real world assets backing Dai.
The bank trying to issue a loan is the first traditional bank, but we see some newer banks.
There’s even some silver backing it. Centrifuge is a cool project. I might go over them in a future IanCast. They are a link between real world assets and DeFi. A silver company can post silver as collateral through Centrifuge. Then they break it up into shares.
Those shares are currently in the Maker DAO treasury backing the stable coin. There’s a lot of things going on. I hope everybody can follow that. It does get complicated, but I find it interesting. I think this bank reaching out to Maker DAO is a big step for DeFi and the financial industry in general.
All About The Altcoin Of The Week!
The altcoin of the week I want to go over is Arweave (AR). I know we had one guy, Levi, reach out to me on YouTube and Twitter and ask me what I thought about AR. I am going to tell you what I think about AR and I hope it’s helpful. It’s one of my favorites.
You read my mind because I had been planning on doing AR today for at least a week and a half. AR is one of the most interesting things going on in crypto. They are providing a file storage system that is decentralized and also permanent. Those are the two things they are solving.
It’s two of the biggest weaknesses of the current internet: centralization and impermanence. With centralization we can look at Amazon Web Services (AWS), which is a big storer of data.
They have centralized servers. They have centralized a small group of people at the top making decisions, which is not ideal when you are controlling this much information.
Last December was a bad month for AWS. They had three outages. This article was posted after the first one. It says, “Amazon Web Services explains outage and will make it easier to track future ones.” Then they went ahead and had two more outages after this article was published.
Then Facebook had two outages in the span of two or three weeks. It was a rough three months for internet data storage companies. AR is a solution to this. Not only are they improving on the current internet with decentralization, they are also aiming to be a permanent form of the internet.
A couple stats about that people might not be aware of. 33% of information people put on the internet is no longer there after two years. 72% of the links that were on the internet in 1998 are not there anymore either. Data gets deleted from the internet every day.
People aren’t aware of that, but it does happen. I personally didn’t know that either until I researched this. That was shocking to me. It just speaks about how AR is coming up with a solution for that. Even in crypto with other decentralized methods of file storage, you have IPFS, a lot of projects use this.
There’s Pinata, File Coin, a lot of these systems use IPFS which aims to be decentralized but doesn’t address permanence. An example of that we can see here.
Someone reached out to Infura. They responded and said data is pinned until it’s been six months since it was last used.
As long as you are accessing your data within that timeframe, it will be there for you. He asked what happens after that six months is passed. Is it not possible to keep data around indefinitely? She said, “If the data you have pinned to IPFS is not accessed within the six-month period, our garbage collecting system will delete the data.”
“In order to keep data around indefinitely, you will need to access it somehow every six months.” Obviously, that is not ideal. If you can’t access it for whatever reason or a lot of systems you have to pay monthly. If your payment information changes and it’s been a certain amount of time it will be deleted.
That’s unreliable. AR goes to improve this as well. They way they work is interesting with the nodes that run the blockchain. The nodes verify data, store data and share data. In order to incentivize this, AR keeps track of which nodes share the data the fastest.
The ones at the top of the list that are able to share the data fastest and are reliable with storing the data are paid the most rewards in the AR token. That’s going to further decentralize the network because people are going to see this income stream they can get just from storing and sharing people’s data.
I think that’s going to draw a lot of interest for AR. From a permanence standpoint, for the user you pay once up front and that covers you for at least 200 years. It sounds crazy but based on what I just said with things on the internet not surviving more than two years, it’s important to make sure important information is stored for a long time.
They way they do that is they assume the data storage cost overall is going to go down half a percent every year for the next 200 years. They add all that up and they get the present value of it and that’s how much they charge.
If you are storing data on AR, one of the biggest complaints I have seen is people say it’s expensive. It’s expensive because you are storing it for 200 years or more. If the cost of data storage goes down by more than half a percent in the 200 years, you are going to be given more storage after the 200 years.
Half a percent is barely anything. With the way technology is evolving and decreasing costs, it’s most like going to go down more than half a percent per year. You are most likely going to get more than 200 years of storage from that one-time payment.
Whereas with infura you are paying monthly. The payments are a lot cheaper, but you are also at risk of having data deleted if you don’t access it every six months or whatever the other systems like Pinata and File Coin have.
These are two big benefits from AR that make it an innovative project. You can see here just how much it’s being adopted.
The amount of data stored on AR as of the end of February has grown 977% year-over-year. It now has 52 terabytes worth of storage.
You might not think that’s a lot, but if you consider it’s only been around a few years and if you’re not plugged into crypto you’re not going to know anything about AR. The fact they are seeing this adoption signals they are going to make it and do well.
To my knowledge, they are the only service that provides the things they do with both decentralization and permanence. There are huge things going on there. I think they are going to continue to grow this exponentially.
We have also seen huge amounts of transactions, more than $150 million in the past year.
One of the things that has grown AR recently is the war in Ukraine. A lot of files have been posted to AR that have to do with this. When you are posting sensitive information about something like a war, you are going to have governments or institutions that don’t want that stuff out there.
A lot of people have gone to AR to store this information. In the past month ARK has archived more than 24 million documents directly related to the Ukraine Russia war. Not to say this is a positive in any respect, but it is furthering the awareness and adoption of something like AR that provides this security and not at risk to censorship.
Also permanence. The information from this can live on and we can use it in the future. You can actually see it on the AR chain.
There are actually now more than 41.5 million related to Russia and Ukraine on the blockchain. You can actually go through and see all of them.
That’s another thing that’s great about blockchains, the transparency. This is just one use case for AR. The overarching thing is that a lot of things that are censored or can be sensitive things can be put on AR and awareness can be raised about them.
Bundlr’s Role In Arweave!
I wanted to get into Bundler because it’s a great feature of AR.
They are making it much easier to use. By using Bundler, AR’s capacity is increased by 4,000% without sacrificing security or usability, all while uploading data three times faster.
Basically the Bundler is a feature that allows people to directly import information from Twitter or articles in general. It allows anybody to record tweets or articles permanently on AR via the Bundler network. This has been a huge development for AR.
I believe this is a big reason why we have seen so much information be uploaded to AR recently. Bundler is a huge boost for this network overall.
Another Boost To The Program!
Another boost is this other program called KYVE.
I am going to go over this. I hope I explain it clearly because it can get confusing.
With crypto we have seen adoption of all these blockchains. There’s Ethereum, Solana, Tezos, Harmony, and a million others. KYVE is a program that is linked to all these chains. They get data from those chains and validate it and upload it to AR. It’s like a data aggregator.
Say there are people storing data on Avalanche and there are people storing data on Ethereum. KYVE goes in there and uploads the data to their service. They validate it and store it on AR. It’s another step making the process easier and more efficient.
It makes it easier to unify all the on blockchains and put in on AR. It also acts like a filter. It validates the information and makes sure it’s good and secure. Then it uploads to AR. That lessens the load for the AR blockchain as well. Then you can retrieve the data from KYVE and AR.
I believe last year KYVE raised more than $2 million worth of funding. There is some attention going toward the AR ecosystem. It’s gotten very big as of January. While most people don’t even know AR exists, meanwhile I find something and then there’s all this development going on behind the scenes and money pouring into it.
AR had this huge ecosystem. It’s really impressive. These services are doing a part to make AR more efficient for the blockchain in general. That’s really all I wanted to point out for KYVE.
SmartWeave, Another Feature
There’s also another feature of AR built into the blockchain: SmartWeave. Basically it’s their type of smart contract. I won’t get into the details on it. The incentive that is gives people building apps on AR, they basically pay microdividends to developers.
Say you are developing a Uniswap-type thing where it’s a decentralized exchange where you can trade AR on the blockchain. Every single time someone uses that app, if you are part of the team that developed that, you get paid a small amount for every usage.
That will add up over time. It’s a big form of incentive I haven’t seen in any other blockchain thus far. Really innovative feature that I think is going to be another thing that drives adoption. It’s a built-in way to incentivize development. Development leads to adoption and efficiency.
We see here that the number of SmartWeave contracts has been a rapid adoption, It looks like since April 2021 it has gone up exponentially.
From around 0 to 35,000. This is as of February. We are seeing rapid adoption with these incentives.
How Could You Use Ardive?
Another thing is ArDrive. This is an easy way to store data on the AR blockchain.
When you say data storage on a blockchain it can make it sound confusing, maybe intimidating because interacting with a blockchain isn’t’ something people want to do.
Basically ArDrive is a website. It is built into the AR blockchain. It lets you store files from your computer onto the AR blockchain. They just had a big funding raise. I think it was $17.2 million. Just another example of more money going into this ecosystem.
A New Place For Blogs!
The last thing I want to share is Mirror which is a blog.
You wouldn’t be able to tell any difference between Medium or Substack and Mirror expect all these blogs get put into these data entries. All the text from these and other forms of data are immediately stored on the AR blockchain when you post any article onto Mirror.
I thought this was a cool feature too. Blogging is something that’s huge right now. It’s just another way to adopt the AR blockchain in a way nobody would realize is something that is interacting with the crypto world. You can write articles on here and they are uploading your information on to AR.
From there it will be stored for 200 years. You don’t have to worry about anything from a centralization or impermanent standpoint. I actually just found out about Mirror recently but it looks like it’s being adopted as well. I have seen multiple articles on Twitter on Mirror that aren’t even about AR.
The rate of adoption here is impressive. AR overall I find to be interesting and unique. I hope everybody found that interesting. If you have another other questions about AR or anything in crypto leave them below.
Your Questions are Answered!
Before we end, I want to get to the questions we got in last week’s video. Scott says,
“I love your update where you discussed the ETH halving and staking. Am I correct to assume staking in ETH will adversely affect mining prices? Thank you so much.”
For the most part I don’t think there are too many publicly traded ETH miners. The only one that comes to mind is Hive Blockchain. They own a lot of ETH on their balance sheet. They are going to benefit even though they are not mining anymore, pr at least they wont be after the merge.
They will benefit from holding all that ETH. They also mine a lot of BTC. I think ETH miners who are smart and want to stick around are also getting into BTC mining in a serious way. I know they have converted some of their infrastructure to mine BTC instead.
They are making the move for that. As far as the other miners go, I’m not sure many others are big ETH miners.
Next question is from Andrew.
“I am not comfortable with crypto but I thought it was to be secure and untraceable. Seems every day there is a crypto hacked. Also there are companies that trace transactions for the government, police and probably IRS. It seems it is not as rock solid as it was hyped up to be.”
With most crypto the issue is that they are a secure decentralized way to transact money. BTC some people think it’s untraceable. That’s not the case. It’s very transparent, which can be a pro or a con depending on how you look at it. Money can be traced through the BTC network and ETH.
The only network that seems to be untraceable to this point is Manero. Everything else your money can be traced. The untraceable aspect is a false narrative out there. For the most part, these big blockchains are secure, especially BTC and ETH.
BTC is the most decentralized and the most secure. ETH I believe is second place. Some of the smaller ones are not. That’s why BTC and ETH to me are the two most solid things to invest in crypto. Again, not financial advice. I am not saying what or when to buy,
I am just saying these have proven over time to be the most secure in the crypto space. As far as being untraceable, that’s not something that I would say applies to BTC or ETh, but they are secure.
The last question is from RFTMMA, This was a YouTube comment. He asked about DFK. I assume you are talking about DeFi kingdoms. This is an interesting project. It’s a play to earn game in the metaverse. It started out on the Harmony blockchain.
I did see they are now on the Avalanche blockchain too. To my knowledge, this is the biggest game on more than one blockchain, I saw the price went up recently. It looks interesting. I don’t have too much to add at this point other than the fact that it’s cool they are able to be on more than one blockchain.
I know they have a big peer-to-peer marketplace. There’s $4 billion value locked into the game. It seems like something worth watching. Maybe I will look into it and talk about it in a future video,
That’s it for this week. Thank you for watching. If you have any questions, leave them below. I will see you again next week.
Disclaimer: We’re not recommending our altcoins of the week. We are just sharing our opinions, not advice. If you want access to the altcoins that we recommend in our model portfolio with tracking, updates and buy/sell guidance, please check out Crypto Flash Trader.
Keep sending your crypto questions to BoldProfits@BanyanHill.com for future IanCasts!
Editor, Crypto Flash Trader
🚨 Paul FOMO Note: I had a severe case of fear of missing out today, so I wanted to jump in on your new IanCast for a quick sec! Getting crazy big returns for my readers is the most amazing feeling in the world.
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I’ve been investing for more than 25 years. I started my career on Wall Street in 1991 as an assistant portfolio manager at Bankers Trust. I quickly advanced to prominent positions at Deutsche Bank and ING, managing multimillion-dollar accounts. In 2006, the owners of a $6 billion firm named Kinetics Asset Management recruited me to manage their hedge fund.