The Wolf Den Crypto Newsletter

By Scott Melker aka The Wolf Of All Streets

The Wolf Den #555 - Millionaires and Billionaires

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August 3 · Issue #555 · View online
The Wolf Den Crypto Newsletter
Welcome to The Wolf Den! This is where I share my ideas about the market, technical analysis, education and advice regarding trader psychology and emotional control. The newsletter is released every weekday and is completely FREE.
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In This Issue:
  1. Millionaires and Billionaires
  2. The Ethereum Bear Market Rally
  3. Legacy Markets
  4. ETH Flips BTC On Open Interest
  5. Robinhood Earns Another Fine
  6. Will The Mega Rich Bitcoin Hardrive Finally Be Found?
  7. Solana Wallets Under Attack
  8. My Recommended Platforms And Tools
Millionaires and Billionaires
Here is some interesting math.
The difference between one million and one billion is massive. The magnitude of the difference is difficult to comprehend. One billion is one thousand times larger than one million. Obvious, right?
Written out, the numbers look like this.
1,000,000 vs 1,000,000,000
It’s a 7-figure number vs. a 10-figure number.
I think the best way to visualize the difference is in earnings. If someone were to earn $1,000,000 a year, that person would need to earn $480.77 per hour and $3,846.15 per day. As high as these number seems, they don’t feel impossible. 
Now, let’s see how these figures compare to earning $1,000,000,000 a year. This would require earning $480,769 per hour and $3,846,153.85 per day. There is a world of difference. Let’s look at a few other examples.
In terms of time:
1 Million seconds in days = 11.57 Days
1 Billion seconds in days = 11,574.07 Days (31.7 years)
In terms of population:
1.35 Million people = the state of Maine
1.2 Billion people = the continent of Africa
In terms of weight:
1 Million grams = one walrus
1 Billion grams = seven Statue of Liberties
Why does this matter? Because millionaires and billionaires are often lumped together, yet they aren’t remotely similar. The difference between the two is basically… one billion dollars. Anyway you spin it, one million is effectively 0 when compared to one billion.
Typically when you read online about this idea, the final point is something along the lines of how wealth should be redistributed around the world and billionaires are evil. I won’t bother taking that route. 
What I will say is that investors looking to “level up" should forget about exponential gains and dreams of becoming billionaires. My advice to you is to patiently swing for base hits, stay consistent, and survive to see another day. By following this strategy, you will find peace in knowing you are slowly moving toward adding more 0s, rather than having 0.
The Ethereum Bear Market Rally
This report is written by Daniel Ferraro.
Coming off of extremely oversold conditions and with the merge incoming, ETH has been rallying over the past couple of weeks. This recent action gave a much-awaited rally for the bulls, but the question remains whether this recent price action is the beginning of a positive bullish momentum or this is just a bear market rally.
While the price action of Ethereum has been undeniably positive, we need to understand what’s happening with the supply dynamics and on-chain activity in order to assess if the demand is, in fact, increasing along the price.
Daily Active Addresses activity remains sideways - DAA has historically been a good indication of momentum, as they tend to follow the price action.
  • Excluding specific moments like the wallet consolidation by Binance last week, the number of daily addresses has remained sideways, signaling that there haven’t been new players entering the network.
  • This low number of daily active addresses also points out decreasing activity on the network and in retail usage.
Where’s the Uniswap Volume? - Just as the price of the majority of the crypto assets dropped by 90%, so did the volume in Uniswap V2.
  • Uniswap V2 has been by far (excluding UniV3) the most important Dex, alongside Opensea, the DApp that concentrates the majority of the volume and gas usage in ETH.
  • After reaching historic levels in November of 2021, the volume recorded on-chain for Uniswap V2 has been on a consistent downtrend.
  • Although there was an increase of roughly 100% from the July lows to now in volume, the on-chain activity indicates that only investors or traders with high conviction are the ones remaining
Similar to the volume of Uniswap, one of the best indicators to assess the demand in the network is Gas usage, as it tends to spike when there is an upsurge in usage and urgency of Ethereum users. While increasing gas costs price out smaller transactions, they point to an increase in demand to transact on the Ethereum blockchain.
2-year lows - Despite the positive price action, Gas prices recently reached their lowest since March of 2020.
  • Excluding particular events like NFTs minting, Gas prices have been particularly low, averaging around $8 per transaction.
  • This signals a low demand for network usage and new user demand.
While the price action has been positive, on-chain data is not reflecting the same. It has been lagging behind. Of course, on-chain data is not the only indicator that we must consider, and we’ll keep an eye on the upcoming events.
Legacy Markets
Yields, Dollar Jump on Fed Views as Haven Bid Ebbs: Markets Wrap - Bloomberg
What to watch this week:
  • OPEC+ meeting on output, Wednesday
  • US factory orders, durable goods, ISM services, Wednesday
  • BOE rate decision, Thursday
  • US initial jobless claims, trade, Thursday
  • Cleveland Fed President Loretta Mester due to speak, Thursday
  • US employment report for July, Friday
Some of the main moves in markets:
Stocks
  • Futures on the S&P 500 rose 0.6% as of 8:15 a.m. New York time
  • Futures on the Nasdaq 100 rose 0.6%
  • Futures on the Dow Jones Industrial Average rose 0.5%
  • The Stoxx Europe 600 rose 0.3%
  • The MSCI World index was little changed
Currencies
  • The Bloomberg Dollar Spot Index was little changed
  • The euro rose 0.2% to $1.0187
  • The British pound rose 0.1% to $1.2183
  • The Japanese yen fell 0.4% to 133.67 per dollar
Bonds
  • The yield on 10-year Treasuries advanced four basis points to 2.79%
  • Germany’s 10-year yield advanced seven basis points to 0.89%
  • Britain’s 10-year yield advanced six basis points to 1.93%
Commodities
  • West Texas Intermediate crude rose 1.6% to $95.96 a barrel
  • Gold futures fell 0.5% to $1,780.70 an ounce
ETH Flips BTC On Open Interest
Ethereum's open interest flips Bitcoin's for the first time ever
For those that believe in the destiny of Ethereum flipping Bitcoin, look no further for evidence than what has happened in the options market. For the first time in history, Ether open interest has flipped that of Bitcoin’s on Deribit. What this means is that the total value of open options contracts for Ethereum (contracts that have not expired) is larger than that of Bitcoin. 
When the “flippening” was first reported, the gap was quite substantial. Ethereum’s options value was set at $5.7 billion while Bitcoin’s options value was at $4.3 billion. As it stands, the put-call ratio is currently around .26 for Ethereum, which is a bullish indicator. This figure roughly means for every 1 put option open, there are 4 call options open. Metrics are showing that traders are confidently expecting Ethereum to rise, and now it’s officially the dominant asset of choice for options traders.
Robinhood Earns Another Fine
NYDFS slams Robinhood's crypto unit with $30M fine
The New York State Department of Financial Services has imposed a $30 million fine on Robinhood for violating cybersecurity and anti-money laundering laws. According to regulators, the main issues resulting in the fine were understaffing, non-compliant policies, and failure to list a dedicated phone number on its site.
When was the last time you saw a phone number listed anywhere that was easy to find and to call? Either way, Robinhood was expecting this fine for quite some time. The investigation took place in 2020, so things should definitely have improved by now.
Will The Mega Rich Bitcoin Hardrive Finally Be Found?
Welsh man claims he can pay for landfill dig in search of lost 8,000 bitcoin
Do you remember the story of the man who accidentally threw away his hard drive that had over 8,000 Bitcoin on it over a decade ago? Well, that man has finally secured funding to begin the excavation of the landfill, but still lacks city approval. In an attempt to sway the council, the man has promised a detailed plan to donate 10% of the proceeds, $18.2 million at the time of the article, to the city. I say we turn this thing into a reality show, add a little bit of drama, and find some coins!
Solana Wallets Under Attack
Solana Wallets Targeted in Latest Multimillion Dollar Hack
Another day, another hack. Another embarrassment. Another reason to secure your assets.
Late last night, the Solana community went into a stir as word broke that over 8,000 wallets were being drained, including Phantom, Slope, and Trust Wallets. The details are still hazy, but so far it seems as though “hot” wallets, specifically mobile ones are at risk. Somehow, private keys were being generated to gain access to the funds. Let this be a wake-up call to abandon hot wallets entirely. Some victims have come forth and even said that Ethereum wallets could be at risk as well, but that is speculation.
Crypto is currently a shit show of epic proportions.
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to “Buy,” “Sell,” or “Hold” an investment.
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