September 20, 2023

Good afternoon. As expected, Federal Reserve officials just voted to hold interest rates steady at a 22-year high. While they’re holding their cards close to their chest for now, the Fed did signal that they’re prepared for one more rate hike to close out the year.

Why does this matter to you? Because when interest rates move, so does the crypto market – often in surprising ways. And despite being in uncharted waters, it’s a relationship worth keeping an eye.

That said, we want to hear your thoughts…

How do you foresee the year ending for Bitcoin in light of the Fed's stance?

What will BTC's price be at year's end?

We'll share poll results next week.

Today’s Big Stories:
💰 Blockchain Capital Raises $580 Million
🤴🏿 The New Kings of DeFi

_{Today's newsletter is 612 words, a 3-minute read.}

📌 MUST READS

A Blip of Hope: Blockchain Capital Raises $580 Million

Move aside AI, crypto is back!

For investors this year, AI has been the belle of the ball, hovering up what seems like any available dry capital post the FTX blow up. Nothing emphasized this more than when traditionally crypto-focused VCs began pivoting away from crypto to focus on AI.

But that seems to be changing as a slew of recent VC firms have announced major fundraises to continue to support the crypto ecosystem.

First we had Coinfund’s $158 million fundraise in July, which was shortly followed by Polychain Capital’s $200 million raise.

This week though, Blockchain Capital, one of the most prolific VCs in crypto, announced that it had raised $580 million for two separate funds.

The money will be split between a $380 million “early stage” fund that will invest in Seed and Series A rounds… and a $200 million “opportunity” fund that will invest in late stage fundraising.

Why It Matters
Since the collapse of FTX in late 2022, private financing for crypto deals has fallen off a cliff. According to Architect Partners, crypto private financing declined 75% in the first half of 2023 versus first half 2022.

https://defillama.com/raises

This dearth has caused multiple projects (especially in the metaverse and NFT space) to shut down.

Now, many of these companies that have shut down were unneeded and simply byproducts of the 2022 hype cycle built off of the back of free government money, zero interest rates, and covid-induced YOLOing. But, for an industry as young as crypto, new capital is needed to rebuild and disrupt.

That’s why Blockchain Capital’s fundraise is such a big deal. It may just be a sign of more capital to come.

Is This the End of the Magnificent Seven?

If you own Nvidia (NVDA), Amazon (AMZN), Tesla (TSLA), Google (GOOG), Microsoft (MSFT), or Meta (META)... you're going to want to watch this interview.

Although these tech giants have soared this year, a once-a-decade event could replace them with a new class of leading stocks. Here's who they might be »

🔍️ DEEP DIVES

The New Kings of DeFi

Much of crypto is reeling.

NFTs are at their lowest point ever… most tokens are down significantly from their ATH… and when was the last time you heard the word “metaverse” used in a sentence that wasn’t a joke?

But, with all that, one area of the crypto market is doing quite well: liquid staking.

According to DefiLlama, the total value locked (TVL) for liquid staking protocols has grown more than 290% over the past year to $21 billion. The last time the TVL was anywhere close to this high was in June 2021 right before the TerraUSD blowup.

(For a recap of what exactly liquid staking is and why it is important, you can refer back to our article explaining it here)

Coinbase Announces Liquid Staking Token

cbETH is indisputably great news for Coinbase and $COIN investors, but we can’t ignore its potential dark consequences on Ethereum.

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This growth has led liquid staking to become the largest DeFi segment, surpassing lending and DEXs.

The result? The largest liquid staking protocol, Lido’s, native token is up more than 30% this year.

What’s Driving the Growth?
As much of the crypto ecosystem is shell-shocked from the major blowups leading to an extended bear market, receiving a solid yield has become more and more interesting.

Right now, Lido and Rocketpool are paying ~3.7% APR on staked ETH. Now sure, that’s lower than the ~5% yield you can get on Treasury’s right now, but let’s be honest, inflation is going to eat away any major benefit from fiat anyway.

This Success is Causing Potential Negative Side Effects
While this may be getting into the technical weeds a bit, the success of liquid staking and Lido in particular also comes with some risks.

You see, for Ethereum to be “credibly neutral” it can’t have one protocol controlling everything. That control happens when a protocol has more than 33% of overall staked ETH. We won’t go into all the details, but if you are interested in learning more you can read this and this.

Evan Van Ness 🧉💸 @evan_van_ness

Lido may be the biggest attack on Ethereum's decentralization ("credible neutrality") in our entire history

It's about to breach 33%

Yet many are staying silent

Why?

Sep 1, 2023

1.36K Likes 609 Retweets 659 Replies

As of today, Lido has more than 32% of staked ETH marketshare according to Dune. The battle is on.

Elon is About to Shock the AI World

While the mainstream media was calling Elon Musk a fraud… And banks were predicting Tesla shares would collapse…

I was telling everyone it was time to buy a Tesla.

What happened next stunned everyone. Shares took off like a rocket, jumping as high as 2,445%. Now, it’s too late to buy Tesla.

But here’s the good news…

Elon Musk just announced this new AI venture… And I believe this could be bigger than Tesla, bigger than SpaceX, and bigger than PayPal.

Click to learn more »

TWEET OF THE WEEK

Conor @jconorgrogan

SBF's father was unhappy with his salary at FTX US so he emailed SBF asking for more money, and then pulled the "I'm telling your mother" Dad move and looped SBF's mom into the email thread

Sep 19, 2023

7.08K Likes 1K Retweets 341 Replies

The world is changing… is your investment strategy?

This time-sensitive guide reveals exactly how precious metals may protect your retirement savings (with no tax implications) from:

Big banks using your money to bail themselves out... Surging national debt... Weakening USD… Stock market downturns...

Get your guide here.

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