The Newsletter Merge
4 min read

The Newsletter Merge

Remember this is the last email sent through Ghost, as I'm transitioning this newsletter from to Twitter's Revue platform. The new emails will also be delivered under this new banner: The Crypto Musings. The change should be smoothless, but get in touch if you need help!

Weekly musing: 542 days later.

Dear readers, I started this newsletter on the 31st of March, 2021. Now I'm changing email providers and format: you'll get my emails twice a week, with one weekly reflection on the topic du jour and another with the usual market update.

  • Right now both cryptoassets and the major US stock indexes are approaching their yearly lows, achieved in June. Fortunately, yesterday's FOMC meeting at the US Fed wasn't that hawkish - even if Powell finally upped his game.
  • The world's most powerful central banker clarified the Fed won't pivot to a less hawkish stance soon as it can't rish losing the fight against inflation. As that means the economy will suffer in the process, it's clear prices won't pump soon.
  • Which means it's time to talk about Ethereum's Merge instead - also in honour of this newsletter's own upgrade. As recently reminded, I first talked about the Merge back in May 2021 and have been extensively covering it ever since.
  • But, one week after the move to Proof-of-Stake there's an angle I should reinforce: the unwind is not over yet. Because even though this was a successful implementation from a technical perspective, the narrative is now dead.
  • While before ETH had the mystic anticipation of the Merge going on for its price, which helped it pump much more than BTC and other Layer 1's, now it's just a very correlated asset to the rest of global markets.
  • Since last September 15th, when the consensus mechanism was changed, ETH has already suffered a 25% price drop vs. bitcoin's 6% fall. As more and more people understand this was a sell-the-news event, a reflexive cycle will begin.
  • Compounded by an harsh winter ahead of us, perhaps even worse than what I was considering in some market updates I shared since July, this means there are large incentives to short ETH again after the funding reset of the past days.
  • Due to the interconnectedness of the mostly Ethereum-based DeFi ecosystem, there are also many interesting liquidation levels to tap into within the various lending protocols that are mostly used for leverage purposes.
  • Let's hope I'm wrong, but if we keep getting more bearish sparks from the macro environment, then we're surely in for another dark year ahead. After all, there haven't been many signs of capitulation in the global markets. Yet!

Chart art: 25% lower.

Courtesy of Dylan LeClair, one of the best bears around.

Visual block: 7 days after

Visualise the merge with the help of the Fintech Blueprint podcast!

Three things: 50% lower.

Tweet tip: 1720 days after.

What alts will be around in the next cycle?

Meme moment: 75% lower.

Funny because it's true.

FV Bank: always on the verge.

Integrating Circle's USDC into FV Bank's banking system is just the beginning of our vision of bridging the traditional financial system with the fast-paced digital asset sector.

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Legal Notice
Our newsletter offers opinions and insights from analysts in the cryptoasset space. It is not intended to be investment advice, and should not be treated as such. You must not rely on its information as an alternative to financial advice from a qualified professional. Without prejudice, we do not undertake or guarantee that its information is correct, complete or non-misleading; or that the use of the guidance in the report will lead to any particular outcome or result.