Stacked

2021-12-16 05:55:54 Stacked Insights Newsletter, 12.14.21

BTC bounces as Fed moves to end stimulus

The Fed concluded its monetary policy summit on a high as it decided to withdraw its remaining pandemic stimulus efforts quickly. Traditional and crypto markets responded happily to the news as both turned back up after days of indecision and downward pressure.

To combat soaring inflation, the Fed announced a plan to increase interest rates more than threefold in the next fiscal year. That’s not a bad thing for risk-on assets like crypto as it reins in a fast and loose monetary policy many felt was pushing the economy toward recession.

BTC closed the day at just over $49K to mark a significant turnaround after plummeting to lows around the decisive $46K inflection point. However, altcoins that lost in excess of 30% during the correction are the ones rallying back hardest.

STX, AVAX, EGLD, and FTM have all reclaimed nearly 20% in a display of strength that signals buyers are ready and waiting on the sidelines. Meanwhile, ETH, often viewed as the altcoin talisman, is back above $4K after limiting its losses compared with BTC and blue chips like BNB, SOL, and DOT.

The Avalanche effect

Lately, we’ve talked a lot about pullbacks because, well, that’s pretty much what the market keeps doing. But if you haven’t lost complete interest in checking the charts, you’ve surely noticed one token that doesn’t appear phased at all.

That token would be AVAX, the native asset belonging to the Avalanche platform. It seems like no matter how much everyone else dives, AVAX only dips at most before reclaiming its footing with greater surety than ever.

Why — what’s keeping it strong? Today, as the market showed signs of life, AVAX showed signs of vigor by catapulting +20% as if ready to tackle all-time highs again within days. The move was likely due in part to Bank of America’s declaration that Avalanche might be Ethereum’s first true competitor.

According to BoFa, it all boils down to subnets — the name for custom layer one blockchains anyone can create using Avalanche. Subnets allow the Avalanche network to scale up to 4,500+ transactions per second for near-instant finality. That use case in itself is fine and dandy, but the kicker comes with Avalanche’s increasingly killer network effects.

Just last month, global accounting firm Deloitte signed on to use Avalanche for a FEMA reimbursements service called Close As You Go. The program speeds disaster relief funds where they’re needed most — a fitting application for a fast blockchain.

It's possible we're only seeing the beginning of enterprises adopting blockchains. Given the buzz around Avalanche's speed and security, AVAX might find itself teleporting well into the crypto top 10 by market cap. Open / Comment

2021-12-15 05:24:26 Stacked Insights Newsletter, 12.14.21

Crypto in the congressional spotlight

Cryptocurrencies have stolen the spotlight during US government affairs on numerous occasions this year. However, the spate of congressional hearings that started last week and continue through tomorrow’s monetary policy meeting are the most important yet.

Last week a veritable who’s who amongst crypto CEOs appeared before congress to make a case for digital currencies. Amongst them was none other than Sam Bankman-Fried of FTX, who spoke on the necessity of well-informed crypto regulations and the growing clout cryptocurrencies have in mainstream society.

Several representatives and congresspeople — Reps. Anthony Gonzalez and Bryan Steil — emphasized how crucial a friendly regulatory atmosphere towards crypto is for keeping the rising tide of Web3 innovation domiciled in the US.

That sentiment was echoed across party lines and appeared far more productive than previous divisive meetings. But during today’s hearing, the positive tone stalled around the topic of stablecoins.

Sen. Elizabeth Warren has staunchly opposed the cryptocurrency industry — and today was no different. She claimed stablecoins are “...propping up one of the shadiest parts of the crypto world, DeFi, where consumers are least protected from getting scammed.” She then went on to say stablecoins “pose risks to our consumers & to our economy.”

Her remarks were in direct opposition to Sen. Toomey, who reiterated support for including stablecoins within existing banking infrastructure. “Stablecoins offer tremendous potential benefits, including greater payment speed, lower payment costs, expanded access to the payment system, and programmability.”

BTC holds the line at $46K

After a relatively disastrous week full of liquidations, capitulations, and bearish vibes across Crypto Twitter, BTC finally appears to have found its footing between $46K — $50K.

The indecision currently taking hold of the market appears correlated to the final day of Fed monetary policy talks scheduled for Wednesday. Many expect the Fed to comment on the unexpected and unabated rise of inflation.

Increased flight to stablecoins indicates traders are expecting increased volatility. However, given Bitcoin’s core utility as a store of value that hedges against inflation, the anticipated volatility might be to the upside. In recent weeks, BTC has repeatedly entered oversold territory, indicating sellers are increasingly exhausted in the current range.

Watch for a reaction should BTC touch $46K — a strong bounce here shows needed vigor from bulls if they hope to bring BTC out of its short-term slump. Open / Comment

2021-12-08 19:24:01 Stacked Insights Newsletter, 12.08.21

Why Square's rebrand is a huge W for crypto

After resigning his role as Twitter CEO, Jack Dorsey wasted no time going all-in on a new vision for his payments company Square. Dorsey approved an unanticipated rebrand to Block — signaling his intention to move decisively toward crypto.

Block will oversee an ecosystem of products including Cash App, Tidal, and a platform for Bitcoin developers called TBD54566975. And yes, Square will live on too, but only as a payment processing service.

If the move sounds familiar, that’s because Facebook just finished a similar pivot with its Meta rebrand. However, whereas Mark Zuckerberg is trying to further centralize the web, Dorsey seems intent on decentralizing it.

Payments are a powerful thing. After all, we’re talking about the movement of value which is the essential ingredient keeping the global economy spinning. In the film Dune, he who controls the spice controls the universe. But in our world, the same is true for whoever controls the flow of money.

What if no one and everyone controlled the flow of money? That’s the prospect enabled by cryptocurrencies like Bitcoin, but getting the mainstream behind such a network requires friends in high places.

Friends in high places

Dorsey appears to be just such a friend. In a press release, he said Block’s purpose is economic empowerment. Considering his Twitter bio reads #bitcoin, it’s fair to assume the empowerment he’s envisioning comes in the form of global BTC access for all.

But what would that look like? Spread between Block’s holdings is the making of an interconnected empire running on crypto. Tidal, for example, is already considering adding NFT support allowing artists to receive permanent royalties on resales. Square itself holds over 8,000 BTC and is generating billions of dollars each quarter from crypto sales.

Why single out Dorsey and the Block ecosystem? Well, the answer is simple — no one else is building crypto into its business model at Block’s scale. They’re not just big fish, they’re whales in the TradFi world. Square alone is valued somewhere north of $124 billion.

That’s why Dorsey’s bold move toward crypto is likely to have major repercussions for his competitors and will likely reshape the conversation about crypto for years to come. Open / Comment

2021-12-07 03:47:00 Stacked Insights Newsletter, 12.06.21

We just raised $35M to build the best crypto investment tools in the world

Here at Stacked HQ, we’re in full-on celebration mode after closing a $35 million funding round with some of the industry’s most incredible supporters

To say we’re in disbelief just wouldn’t be right — we’ve known all along that Stacked is the best platform out there for passive crypto investing. But having years of hard work and long-term vision validated by industry titans like Alameda Research...well, that just hits different.

It wasn’t only Alameda who made this possible. The funding round was co-led by the amazing people at Mirana Ventures and strengthened by Fidelity International, DRW, Alumni Ventures, and Jump Capital. Our investors see the same thing as our rapidly-expanding userbase — a simple way to passively gain exposure to the most exciting asset class in the world.

Stacked has enabled $10 billion worth of crypto transactions while on a shoestring budget and with nearly zero marketing efforts. We’ve grown organically on the strength of word of mouth recommendations because our products win in diverse market conditions and are truly easy to use.

With increased funding, we can finally go all-in on building tailor-made structured investment products like risk-adjusted portfolios, granular investment advice, and customizable stacks made from successful strategies. To get there, we’re doubling our stellar team of 40 and working to partner with more crypto exchanges.

If you haven’t given Stacked a try yet, here's your chance. Join us at StackedInvest.com to create a free account and instantly invest in professionally built portfolios Open / Comment

2021-12-06 15:47:00 https://techcrunch.com/2021/12/05/stacked-raises-35m-to-bring-passive-investing-tools-to-retail-crypto-traders/ Open / Comment

2021-11-24 04:42:58 Stacked Insights Newsletter, 11.23.21

Should you abandon Ethereum?

Last week, Three Arrows Capital CEO Zhu Su kicked the hornet’s nest when he stated he was walking away from Ethereum. In his opinion, Ethereum gas fees have priced out the majority of retail users because developers have acted too slowly in upgrading the network’s capacity.

Ethereum 2.0 represents the long-awaited switch from proof of work consensus to proof of stake. The move will make Ethereum orders of magnitude more energy-efficient while increasing network throughput several hundred times using sharding technology.

However, the move to ETH 2.0 has been dogged by factional infighting between key Ethereum developer teams causing perpetually delayed milestones. In the here and now, demand for Ethereum is at all-time highs — a fact evidenced by the $300+ transaction fees that show no sign of abating.

That’s why Su — along with other influencers — are coming out of the woodwork to claim they’ve left the Ethereum ecosystem for good and are now all in on other Layer 1 blockchains.

The L1 space heats up

The chains generating the most support at the moment are Solana, Polkadot, Avalanche, and Tezos, but several lesser-known networks are waiting in the wings. Those include Oasis, Kadena, Near Protocol, and even the interoperable ICON network.

Of those names, only Solana, Polkadot, Avalanche, and Oasis have fully deployed mainnets along with decentralized exchanges, EVM compatible tools, and vibrant DeFi + NFT markets. However, the question ultimately boils down to whether that’s enough to walk away from Ethereum, the world’s most liquid, adopted, and asset-rich blockchain.

But L2s can save Ethereum

What Zhu Su and others forget when they throw mud at Ethereum is that effective Layer 2 scaling solutions already exist with fully deployed applications + billions of dollars worth in TVL. For examples, look no further than Polygon, Loopring, Arbitrum, Optimism, and Immutable X.

Because of L2s, it’s simply too hasty to walk away from Ethereum, especially when one can also bridge Ethereum assets to other more scalable chains like Fantom. Heck, you can bridge Ethereum assets to Solana and Avalanche too.

Instead of abandoning Ethereum, we advocate experimenting with other blockchains to see how they work and what’s available on them. On Tezos, you’ll find an incredible wealth of fine art NFTs while on Solana there’s DeFi and gaming. The future is multichain, so it makes perfect sense to get adjusted now.

But it’s likely that Ethereum will always sit at the head of the table when it comes to L1s — especially when ETH 2.0 rolls around. So, don’t walk away just yet. Open / Comment

2021-11-23 03:18:47 Stacked Insights Newsletter, 11.22.21

The best resources for learning on-chain analysis

On-chain analysis is something you hear about from big league traders but feels impossible to learn on your own. Thankfully on-chain analysis is nowhere near as complex as it often seems. No, it’s actually downright simple because you’re essentially just making straightforward interpretations of public data on blockchains.

We walked you through a few of the basic necessities for learning about on-chain analysis in our previous updates. Some of those basics are:

Tracking token movements on/off exchanges
New wallet creation to track adoption
Using on-chain indicators like the Puell Multiple

You have the basic ideas, now it’s crucial to look at who the best in the business are so you can follow by example. Without further ado, here are some of the best on-chain analysts and tools at your disposal.

Best on-chain analysts

There are technical analysts, fundamental analysts, and then there are on-chain analysts. OCAs are a combination of technical + fundamental analysts as they use analytical data to interpret fundamental factors. The best on-chain analysts to follow today are:

Willy Woo is an on-chain expert with nearly 1M Twitter followers.
Ki Young Ju founded CryptoQuant and delivers precise OCA.
David Puell invented the Puell Multiple and other OCA indicators.

As a starter pack, the above three OCAs are the best in the biz and will help you quickly understand the ins and outs of tracking blockchain data. Go to Willy Woo for bite-sized kernels of wisdom, Ki Young Ju for wallet ←—> exchange flows, and David Puell for advanced lessons on OCA.

Tools you can’t miss

On-chain analysis demands up to the second data on token movements across blockchains and exchanges. You need to interpret data accurately — but there’s so much of it that you can’t go without game-changing tools.

Glassnode is widely respected as the leader in on-chain metrics.
CryptoQuant promises actionable on-chain data.
Parsiq is a decentralized platform for monitoring on-chain data.

Glassnode is the industry standard for following blockchain financial data. However, CryptoQuant is a crowd favorite amongst retail traders. Finally, Parsiq lets you build custom modules for monitoring blockchain data in real-time so you can set up alerts and signals.

Top on-chain indicators

To get the most out of on-chain data, you need to head straight for the best indicators to build a picture of the global situation. Get started with the following indicators:

Wallet <-> exchange inflows & outflows: Learn to identify when traders are depositing large sums of tokens into exchanges. This often signals a sell-off is near.

Fiat & stablecoins flows between exchanges: When price action is led by fiat to crypto exchanges, institutions & retail are leading the charge, whereas stablecoin led bull runs indicate seasoned crypto traders are at work.

Track blockchain usage by units transferred: The more token units transferred on a given day/blockchain, the greater the demand for that blockchain + asset, leading to a jump in price down the line.

This is not a conclusive list of on-chain indicators but is a great starting point for using some of the most widely quoted indicators in the OCA space. Get to know how to track exchange inflows and blockchain usage like the back of your hand, then you’ll have an easy time determining market sentiment without checking Crypto Twitter. Open / Comment

2021-11-11 00:46:06 Stacked Insights Newsletter, 11.10.21

Using on-chain analysis for BTC trading

The BTC blockchain allows anyone to see public stores of organic financial data. That’s an incredibly powerful info source if you know how to use it. Use this quick guide to on-chain analysis to inform your crypto trades + investments using blockchain-based signals.

Tracking token movements
The best place to start with on-chain analysis is this question: are token holders actually holding tokens or are they spending them? To figure that out, you need to track token movements. Tracking tokens is a fundamental part of on-chain analysis. In a nutshell, on-chain analysis seeks to watch Bitcoin wallets for a few things:

Token inflows/outflows to exchange wallets
Whales (high net worth wallets) moving tokens
HODL rates (movements of old tokens)

Watching the amounts of tokens in wallets can help uncover soon-to-happen events like supply shock — a phenomenon that happens when there aren’t enough coins in circulation to cover demand.

For instance, if on-chain analysis reveals more BTC wallets are increasing their holdings and moving to cold storage vs. sending BTC to exchanges, it’s evident the market is in accumulation mode. Accumulation typically precedes a bullish phase — so, if you’re aware of accumulation, it’s simple to position yourself accordingly.

On-chain indicators
There are a few well-tested and trusted indicators used by on-chain analysts for understanding market cycles. One of the most important indicators is called the Puell Multiple (PM).

What the PM effectively measures is how profitable BTC miners are by combining daily BTC emission rate + yearly moving average. When miners are very profitable during market tops (high incentive to sell), the PM tends to peak above a reading of 4, giving you a straightforward way to cycle in and out of the market using real data.

Another simple on-chain indicator is realized market cap. The realized mcap removes all inactive mature coins (i.e., tokens that haven’t from wallets moved in ages) from its purview, then revalues them at current prices when they’re spent.

With realized mcap, you can determine whether the market is in a bull, bear, or accumulation phase based on the interplay between the realized cap and the market cap. Historically, the market cap dipping below the realized cap means a bear market cycle has finally bottomed out.

Next, we’ll share the best resources for getting started doing your own on-chain analysis. Open / Comment

2021-11-09 14:56:11 Stacked Insights Newsletter, 11.09.21

Intro to on-chain analysis

Blockchains are massive public data sets tracking token movements. They allow us to view incredible amounts of financial data, including:

Real-time token movements (to/from exchanges)
New wallet creation (to gauge adoption)
Active addresses + tx count (to gauge demand)

Nothing even remotely close to on-chain metrics exists outside of crypto. But that’s a feature, not a bug — cryptocurrencies like Bitcoin are designed to be fully transparent. What on-chain analysis does is utilize that transparency to inform your trading + investment decisions.

How to use on-chain analysis, pt. 1

Blockchain networks count utility as a fundamental feature. Determining just how much use a network is seeing relative to its market cap/token price is a quick yet insightful way to judge how undervalued or overvalued that network + token is.

An early yet timeless way to position how a given blockchain network + token is valued is the Network Value to Transactions (NVT) ratio. The NVT ratio is a basic formula that divides the network’s market cap by its transaction volume within a set timeframe.

Taking Ethereum for example, let’s imagine high token prices at ~$4.5K ETH yet network transaction volume during that same quarter is at a yearly low. The low volume reflects low demand for Ethereum, a network based on utility, insinuating that at $4.5K ETH, the network is overvalued.

You can also use on-chain metrics like NVT to contextualize other fundamental factors. Perhaps competing L1 blockchains like Solana, Polkadot, and Avalanche are gaining impressive traction during the same quarter Ethereum’s transaction volume is declining. Now, you have a more complete picture for creating an investment thesis or trading based on hard data.

Similarly, if Ethereum is seeing record breaking transaction volume (usually reflected by high gas prices) at the same time ETH price is stagnating, the NVT ratio might indicate ETH is undervalued.

In part 2, we’ll explore how to zero in on effective trading strategies using other on-chain metrics like new wallet creation and tracking token movements between relevant wallets. Open / Comment

2021-10-31 20:49:34 Stacked Insights Newsletter, 11.01.21

Metaverse tokens on the move
Is Ethereum about to send?
The best-kept secret in NFTs

Metaverse tokens on the move

By now you’ve surely heard about Facebook’s rebrand to Meta. Twitter is already full of memes covering all the most cringe moments from Zuck’s keynote, so we won’t rehash them here.

And even though the CTO of Oculus, a Meta-owned company, says Zuck has no plans to fully embrace crypto, the rebrand is indisputably good for metaverse-related crypto projects. That’s why several of them, including MANA, ENJ, and SAND, have doubled in price overnight.

This is likely just the beginning of the run on metaverse tokens. Projects like Decentraland have been around for years but there are several less well-known metaverse tokens waiting to be found.

ILV
Illuvium is an expansive RPG game on Ethereum via the scalable Immutable X sidechain. Gameplay revolves around collecting creatures called Illuvials scattered throughout Illuvium, a vast metaversal landscape.

UFO
Similar to Axie Infinity creators Mavis Labs, UFO Gaming is building a gaming metaverse filled with Play To Earn games, lands, and in-game collectible NFTs. Called the ‘Dark Metaverse’, UFO’s digital world requires UFO tokens to unlock experiences.

ATLAS
Star Atlas is an intergalactic metaverse game based in the year 2620. It’s built on Solana and uses two in-game tokens, ATLAS and POLIS, along with NFT and DeFi mechanics. The team creating Star Atlas is sophisticated and world-class, so watch this space.

Is Ethereum about to send?

Bitcoin pierced its all-time high recently, leading to the very natural speculation that Ethereum was next. Sure enough, ETH crept just above its ATH, but not with impressive conviction.

ETH has since slunk back below $4300 but appears poised to strike. Does it have the legs? In our estimate, ETH has several fundamental factors to push it higher.

The metaverse is largely built on Ethereum
Since EIP-1559, $3B in ETH has burned

On the technical side, Ethereum has completed a corrective wave 2 in an ascending channel and appears to be in the early stages of a parabolic wave 3 rise.

Here’s an easy visual to help you see it.

Is Hic et Nunc the best-kept secret in NFTs?

Most of the NFT action is happening on Ethereum by way of marketplaces like OpenSea, Foundation, and SuperRare. There’s also a bit of Solana NFT activity but the quality/quantity of work isn’t there yet.

But Hic et Nunc, an NFT marketplace on Tezos, is surging forward to challenge Ethereum. If you follow the NFT space closely, many of the best + most collected artists are now linking to Hic et Nunc profiles (sometimes called HEN or HIC). Why are they moving to Tezos?

First and foremost, Tezos transactions are so cheap they’re basically free. They also confirm quickly. But the second reason for the explosion in Tezos NFT activity is quality artwork.

Hic et Nunc has managed to attract countless artists from the worlds of fine art, resulting in an NFT platform filled with works that rival the highest-selling pieces on SuperRare. To sweeten the deal, HEN artworks are also generally priced far below what Ethereum NFTs sell for.

There’s also OBJKT, the Tezos version of OpenSea, if you want to dive deeper. Open / Comment