One step forward and two steps back.
Bitcoin making new all-time highs earlier this week above 124,000 before pulling back.
Now the crypto major pressure by some hotter than expected PPI numbers, as well as Treasury Secretary Besset initially saying the US won't make additional Bitcoin buys for the strategic reserve.
He did later follow up. saying the Treasury is committed to exploring budget neutral pathways to acquire more Bitcoin to expand the reserve.
Well joining me this morning to weigh in is Ray Salmon, head of markets for Coin Telegraph.
Good morning, Ray, and happy Friday.
Thank you so much for joining me.
Well, first and foremost, best going back and forth on US plans to acquire Bitcoin.
So take us through the impact on the market.
Well, you know, it looks like Secretary Besson got an email from HR shortly after his statement yesterday on Fox Business News, and he clarified it by the end of the day.
So despite the initial shock, the administration's pro-crypto stance is still clear.
It's regulation, adoption, and infrastructure, those are the policy priorities, and there's multiple theories in circulation that suggest multiple funding paths for a strategic Bitcoin reserve.
They intend to use seized Bitcoin to seed the reserve.
There's the option of using tariff or future tariff revenues to fund the the SBR.
Um, there's the asset swaps which Besant kind of said no to yesterday.
Um, there's the option of Bitcoin fees or government Bitcoin like being used to pay fees, um, governmental fees and whatnot.
We could see bitcoin mining begin to start at a federal level, like in government buildings.
There could be the issuance of Bitcoin-backed bonds.
There's a lot of options on the table, so I think with this crypto-friendly Congress and the president himself being, you know, pro crypto, I would expect SPR to come before Trump's second term ends.
Ray, it will be interesting to see how all of this plays out, but I want to get your take on what we've been seeing with E, the other crypto majors.
So we saw Eth come close to topping 4800 and hitting a new all-time high.
Altcoin investors are indeed excited.
But take us through Altse versus each season.
Tell us about this debate.
I would say that this phrase kind of goes along with it.
A rising tide lifts all ships, and there's a handful of arguments that would suggest that if we're not in an alt coin season already, we're at least on the verge of one.
So if we look at total 3, which is the market cap of all cryptocurrencies excluding Bitcoin's market cap and Ethereum, it's risen from 700 billion in April of this year to nearly 1.1 trillion.
And at the start of this week, that's a near 56% increase.
What's happening here is the Genius Act and SEC Clarity have boosted DFI and some altcoins, regulating stablecoins and the SEC's multiple statements on Ethereum, meme coins, airdrops, and other DFI native processes not being securities or unsanctioned securities issuances.
These are all the net positive.
For the decentralized finance landscape and not only did we see the market front run this legislation, but to this day we also see the benefits across a handful of DFI and decentralized exchange related coins.
And there's a few charts that I had shared.
So basically DI tokens remain a high beta play on Ethereum, which is up 70% in the last three months, and currently $156 billion. has been deposited across major DI platforms and our Treasury Secretary Scott Bessy, he says that or recently I recall him saying that stablecoins could see their $270 billion base expand to $3 trillion or higher by 2030.
So just imagine what DI tokens could do in altcoins if this type of growth takes place over the next four years.
And Ray, finally, before I let you go, let's talk about Bitcoin.
So we saw that crypto major hit new all-time highs earlier this week before pulling back.
So where do you think we'll go next?
I think anything's possible, especially in a market where major stock indices are hitting new highs weekly, sometimes daily, right, and equities are in record breaking mode and Bitcoin's riding that momentum, so.
Um, hm, the recent pullback, that 3 to 5% pullback, it looks big in dollar terms and it's shocking to newer investors, but this is normal volatility.
Uh, Bitcoin's historical daily range is within 1% to 5%, and it's also normal to see a bit of customary selling, like forced selling and profit taking near all-time highs, right?
So I think the important thing to remember.
Is that Bitcoin's long term growth still outpaces most assets with like double digit compound annual growth rate over a 1 year, 5 year, and 10 year horizon.
Um, looking at some charts today, we saw that, uh, at Coinbase and the spot markets and also Binance spot, there was a lot of buying there.
The coin-based premium has returned.
Bitcoin's kind of mean reverting back.
To its average trading range.
So yeah, it fell all the way down to 117,000, but now we're testing 119, 120 again, which is not too far away from the all-time high.
So I think the response that we've seen with ETF inflows into Eth and also into Bitcoin and the response in the spot markets show that traders are confident that new highs can be achieved likely before the end of August.
OK, Ray, well, we will have to leave it there, but thank you so much for joining us on this Friday morning and as always, thank you so much for all of your insights.
Thank you.
