Wednesday, June 14, 2023

Rate signals, BTC vs Nasdaq, some notable NFT stuff and more...

“That's something that tends to happen with new technologies generally: The most interesting applications turn up on a battlefield, or in a gallery.”  – William Gibson ||

Hi everyone! Fed Day is here! As usual, the fun is in the details, in this case the FOMC economic projections which should shed some light on just what “higher for longer” means in the face of softening inflation.

You’re reading the premium daily Crypto is Macro Now newsletter, where I focus on the growing overlap between the crypto and macro ecosystem. Thanks so much for being a subscriber! Nothing I say is investment advice. Nevertheless, I hope you find it useful – if so, please consider hitting the ❤ button at the bottom and sharing with friends and colleagues.

If you’re not yet a subscriber, I hope you’ll think about becoming one to support my work. It would REALLY make my day! 😊 It’s currently only $8/month (with a free trial!), although I will be raising the price soon.

WHAT I’M WATCHING

Inflation. Well, that wasn’t so bad. Not great, though. More on this below.

China rates, corrected. I learnt something interesting from Weston Nakamura’s excellent podcast this morning: China’s short-term rate cut yesterday was a surprise (I had posited it wasn’t) because the PBOC hardly ever cuts these before the medium-term benchmark. The last time they did this was March 2020. So, I was wrong, the signal sent there certainly was startling, as was the market’s lack of reaction. Weston believes that this is because no-one is believing the China recovery story and investors are just staying away from the market.

Hinman emails. You may be wondering why the crypto ecosystem is making such a fuss about the Hinman emails. It’s for two main reasons: 1) they reveal the SEC’s thinking around tokens at the time then-commissioner William Hinman said in a public speech that he didn’t think ETH was a security, and 2) they weaken Gensler’s argument that ETH might be. The documents were released as part of the SEC’s case against Ripple, and the legal team’s thinking is that they might weaken the argument that XRP is a security, but that is not so cut-and-dry.

NFT cool. The hype and froth in the NFT collectible space has mercifully died down, but every now and then a cool application of the concept emerges that reminds us of the innovative engagement and connective experiences the technology offers. Snoop Dogg has launched an NFT collectible series that will evolve as his tour progresses. Holders will be able to access original graphics, behind-the-scenes content, potential air drops and other features in an example of “programmable” art but with some real-world relevance.

A less compelling (but for interesting reasons) example of “NFT cool” is a collaboration between digital artist Fewocious and Adidas. Its copy has more cringe-y hype (what on earth is “a harmonious collision of perspectives”?) and a stack of complicated tiers of access to mint the NFT (which I struggle to understand). Plus, the idea of combining a digital good with a physical one sounds intriguing but I’m not sure how long the fascination would endure post-purchase.

MARKETS

Inflation