🚀 Decoding the Crypto Forecast: What's Next in 12-18 Months!

Coming out of the bear market might seem challenging, but remember there's always a silver lining, particularly when you zoom out to the broader picture. We are going to dive into some of those insights with you today.

Let's delve into my predictions for the crypto markets over the next 12-18 months.

What I foresee kickstarting our next growth phase, helping us move past this stagnant period, is a blend of timing and prevailing stories. The silver lining? We're poised favorably on both fronts for the upcoming year and a half.

If we align the current phase with the standard four-year cycle, the parallels between 2019 and 2023 are remarkably consistent. While it's plausible that ETH and BTC might see further dips, I'm inclined to believe we're in a phase of asset gathering, not dispersing.

As for the prevailing tales, several positive events are overshadowed by lackluster price movements. But as seasoned observers know, price trends often dictate the mood, irrespective of how promising the news or story might be.

Now, I categorize these narratives into two segments: those that resonate with the general public ("outsider bullish") and those that appeal to the crypto-savvy community ("insider bullish"). However, it's worth noting that crypto aficionados can and do align with both narratives.

The general audience's bullish narratives include:

- The anticipated Bitcoin halving come April 2024.

- Potential influx of ETFs, with approvals likely around the first half of the year. Grayscale's conversion to an ETF might precede this.

- ETH staking becoming a magnet for traditional finance due to the prospect of passive earnings.

- Regulatory advancements in the U.S and internationally that favor crypto.

- Traditional finance giants like Visa and PayPal further integrating with digital currencies.

For the crypto-insiders:

- The four-year trend seems to be holding up, with 2024 being a decisive factor.

- Post-halving surge for BTC is anticipated.

- The rise of Layer 2 solutions, potentially leading to a Layer 2-centric rush.

- Decentralized social platforms gain traction, pulling more users into the blockchain. (we talked about Friend.tech in a previous newsletter)

- Enhanced supply dynamics for ETH, including the Merge and token burning, causing a surge when demand returns.

- DEX transactions possibly surpassing those of CEX, luring more users.

- An exponential increase in ETH burning, making it immensely deflationary.

For those curious about the broader economic context or "the macro," my view is that the crypto market remains somewhat independent. The patterns we observe in crypto downturns mirror past instances. Nevertheless, for the macro tea leaf readers, the optimistic scenario would be inflation settling around the fed's 2% aim. This could lead to potential rate cuts, although, by then, crypto might already be on a growth trajectory.

Here's to a promising next year and a half. Let the bulls run 🐂 📈

SEC Takes Another Beating in the Grayscale Lawsuit

This week the SEC took a major L in court in the lawsuit brought by Grayscale over denial of their BTC ETF.

What You Should Keep in Mind:

- The U.S. Court of Appeals in D.C. delivered a unanimous 3-0 verdict supporting Grayscale. (It's a clean win!)

- The panel highlighted the SEC's inadequate reasoning for rejecting Grayscale's Bitcoin spot ETF proposal, using terms like "did not meet the mark", "lack of a clear rationale", and "inconsistent and unreasonable" to characterize the SEC's approach.

- The court's remarks? It seemed almost like a satirical roast!

- Context: Over recent years, the SEC has been consistently turning down spot ETF requests.

- Their main concern? The potential discrepancies in how fraud and manipulation might impact spot and regulated futures markets.

- Contrary to this, the court didn't find any solid proof. (Worth noting: Grayscale showcased data indicating a staggering 99.9% alignment between the two markets.)

- The Next Steps? Grayscale has received a "request for reconsideration."

- This prompts the SEC to reassess the proposal and either:

a) Approve the application.

b) Reject the application, but on new grounds (potentially prolonging the ordeal).

c) Challenge the court's verdict, aiming for an "en banc" assessment. This legal procedure involves a larger bench of judges revisiting the decision (it's a rarity).

- All in all, this judgment is a significant stride forward for the sector. It doesn't just enhance the probability of a Bitcoin ETF getting the green light, but crucially, it highlights that the SEC's stance isn't the final say in the crypto universe.

Here's to breaking new ground!

The Twitterverse

A collection of the most interesting stuff on Crypto Twitter this week

Closing the ledger for now, but the crypto revolution continues. Stay curious, stay bold, and keep chasing those blockchain gains!

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