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š„ What to expect in crypto this month... š®
PLUS: 2024 predictions from a crypto VC š
Todayās edition is brought to you by Arrived - a startup that lets regular people invest small amounts of money in single-family and vacation rental properties.
GM. This is Milk Road. We break down crypto news faster than you can break a New Year's resolution.
Hereās how weāre kicking off the year:
What to expect in January š
2024 predictions from a crypto VC š®
The U.S. government dropped 6 charges against SBF šŖ
WHAT TO EXPECT IN JANUARY š
I have 1 big goal in 2024ā¦ look at crypto prices less.
48 hours into the new year Iām here to report that:
BTC is up 8%.
Most of the top 100 cryptocurrencies are in the green.
A few altcoins are up double-digit percentages.
I went from I *have* a goal ā I *had* a goal.
Oh well, better luck next year!
The big question investors are wondering now isā¦ will the rally continue?
3 big factors could help decide that:
1/ Spot Bitcoin ETF approvals.
The worldās largest asset managers (BlackRock, VanEck, etc.) have been trying to launch a spot Bitcoin ETF for months.
Well, it looks like we could be in the final stretchā¦
Reuters is reporting that asset managers might get word about approvals today or tomorrow.
Fox Business journalists are saying the SEC is āswamped with paperworkā so asset managers likely wonāt hear back from them until the decision deadline on Jan. 10.
Our sources are reporting (and I quote): āNobody knows for sure. And asking us āWen ETFā every 20 minutes wonāt make it happen any fasterā¦ā
Why this matters: In the short term, people are speculating that this will unlock trillions of dollars in institutional money, pushing Bitcoinās price up.
In the long term, people are hoping it will have the same success as Gold ETFs. (TL;DR - Gold went on an 8-year bull run, hit a new all-time high, and briefly became the worldās biggest ETF).
2/ Historical trends.
There are 2 big historical trends weāre looking at this monthā¦
BTC: Bitcoin ended the year on a 4-month green streak (i.e. it had positive monthly returns in September, October, November, AND December).
Thatās the good news.
The bad news isā¦ the last 2 times that happened (in 2015 and 2016), Bitcoin followed it up with a red January.
ETH: Both of Ethereumās largest rallies have started inā¦ January.
Check it out. It happened back in 2017 and 2020ā¦
ā¦ and now some are speculating a January-ETH rally could happen again this year.
(Especially with a major network upgrade and potential ETH ETF launching soon).
3/ Token unlocks.
Pop Quiz: What do Injective ($INJ) and Optimism ($OP) have in common?
a/ Theyāve been two of the hottest tokens in crypto. Both are up 100% over the last month and have been the talk of Twitter.
b/ They both have big token unlocks in January. Millions of INJ and OP tokens worth between $87M and $136M will be unlocked later this month.
And they arenāt the only projects with token unlocks either:
Milk Road Rule #58ā¦ where there is a token unlock, there is price volatility.
So, watch out. These projects could have a Rocky Road in the weeks ahead (and we aināt talking Ben & Jerryās).
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2024 PREDICTIONS FROM A CRYPTO VC š®
Every Milk Road subscriber is awesome. Iām like a mom, and canāt pick favorites...
ā¦but if I did, Iād have to admit Fred Wilson is one of them.
Heās been a VC since 1986. #OGstatus
He founded Union Square Ventures and invested in companies like Twitter, Tumblr, Etsy, and MongoDB.
Plus, heās been writing a new post on his blog (AVC - Musings of a VC in NYC) every weekday since September 2003.
Mad respect. Iāve been writing this sucker for almost two years and feel like I deserve a purple heart award...
Anyway, Fred just dropped a new blog titled āWhat Will Happen In 2024ā. Here are 5 of the biggest takeaways:
1/ 2024 is going to be a terrific year for tech.
āI have never seen an environment with more innovation in the forty years I have been in the tech sector. It is breathtaking to see.ā
Coming from a guy whoās been in the tech game longer than Iāve been alive, thatās saying something.
2/ Innovation never waits for rules and regulationsā¦ but it eventually gets it.
2023 was the year crypto got hit by a full frontal attack from U.S. regulators and lawmakers. Luckily, it was able to hold its groundā¦
Fred thinks 2024 will be the year that U.S. regulators and lawmakers finally come to terms with Web3.
3/ Blockchain tech needs its āChatGPT momentā.
A.I. had its big coming-out party last year. The big catalyst: ChatGPT.
Developers use it to help them code. Analysts use it to help break down data sets. School kids use it for educational purposes to cheat on assignments/tests.
It took 40 years, but A.I. finally hit mainstream adoption.
Fred thinks 2024 will be the year that mainstream decentralized applications begin to emerge for crypto.
4/ A.I. and Web3 are two sides of the same coin.
Thereās been a big debate over the last year: TeamAI or TeamWeb3?
(I havenāt seen an argument this intense since middle school girls were arguing #TeamJacob or #TeamEdward).
Well, Fred thinks theyāre two sides of the same coinā¦
AI will help make Web3 usable for mainstream applications.
Web3 will help us trust AI.
Together they will lead to a more powerful, more resilient, more trusted, and more equitable internet.
5/ VC investing wonāt grow much this year.
Fredās reasoning? Limited partners (aka the people who provide money to VCs) have taken a beating recently and are cautious with their funds.
As a result, VCs are struggling to raise funds, scaling back, or shutting down completely.
And because venture funds usually have a ten-year life cycle, Fred thinks itāll take a few more years to reset.
Check out the top news stories from 2023. Look back on a wild 2023 with this consolidated list of the top headlines from last year. āDL News
The U.S. government dropped 6 charges against fkSBF. As a result, fkSBF wonāt be prosecuted for political campaign finance violations.
The AVAX Foundation announced it was going to invest in memecoins. Basing the criteria for investment around metrics such as liquidity, social sentiment, project maturity, and the number of holders.
VanEck released a new Bitcoin ETF commercial. The battle between ETF applicants continues to heat upā¦ will there be a round of Super Bowl ads coming our way?
Total value locked across DeFi protocols has surged to levels last seen prior to the collapse of FTX. Just as Bitcoin crosses the $45K mark for the first time since April 2022.
Bitcoin exchange reserves hit a multi-week low. A sign that long-term thinkers are continuing to HODL at these price levels.
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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.