Bitcoin Is About to Get a Massive Liquidity Boost, Here's why Transcript, AI Summary & Key Points

00:01 I see a lot of people worrying about this dip,  this dip to $83,800 and these red bubbles. And when I look at my Twitter, I basically  see everyone freaking out about this thing called bond rates. So, everyone's freaking  out about the bond rates and the fact that the bond rates are all going up like crazy. US  bond rates, Japanese bond rates, etc. In fact, I think this is probably the best depiction of  what's actually going on on Twitter at the moment, right?

00:27 I mean, these homies sitting in a pad  going, "Bro, did you see the five-year hit 5% today? It's over." Because that's exactly what's  going on here, right? I want to remind you this show why we shouldn't worry. I want to remind  you that the reason why we're actually here is because the bond rates are going up. And I  want to remind you that our run started, right?

00:48 Our run started when the bond rates started going  up uncontrollably and Scott Bessent had to start interfering. And that is why Bitcoin actually  started to outperform, that is when Bitcoin started to outperform all the other assets. So  let's actually dig into exactly what's going on today. We'll debunk this whole bond rate thing  and it's actually a little bit more complicated than you think because generally when bond rates  go up, it used to be scary, but it's actually not that scary anymore.

01:13 So that's what we're going  to be doing today. Big show. Let's do this, guys. I'll tell you one thing. If I'm here with a  broken collarbone, you need to be here, right? Because if I'm here bringing you the crypto love  and the crypto wisdom with a broken collarbone, you need to be here, too. You need to be here,  too. So, listen, if you are here, just remind me that you're here by just subscribing to the  channel if you're not already subscribed.

01:40 If you are subscribed, just smash the like button. Let  me quickly take you through the reasons why we're here. Everyone's panicking about the bond rates. I  want to remind you that we're not panicking. We're not panicking for two reasons. And I'll show  you where we are panicking, right? We're not panicking because the reason why we are here, the  reason why Bitcoin is actually running is because the bond rates are going up.

02:01 It's because the bond  rates that are going up that Bitcoin is actually running. And I'm going to show you how Bitcoin  decouples from the stock markets and from all the other assets, right? I also want to show you that  we're not going to get worried until this happens, right? And when I say this happens, I told you a  few days ago that once we break out of the 50-week moving average, the 50-week moving average on  the weekly, once we break up above it, we don't usually go below it in a bull market, right?

02:30 So,  you can see that with every other bull market. Now, we did break out above it on the weekly this  week. And as long as we don't go below the $78,800 today, but it could be $78,000, $79,000, whatever  it is, or $77,000 depending when we actually get there, then there's no need to worry. I will be  worried if we go below the 50-week moving average and we stay below the 50-week moving average for a  couple of weeks, then I will start worrying.

02:55 Until then, my strategy is every dip that comes is a  buying opportunity. And instead of wasting my time worrying about the dip, I want to be wasting  my time worrying about what should I be buying in the dip that I didn't buy the last time or that  I felt left behind. And even though our portfolio was really good, we actually did get left behind  on a couple of coins.

03:16 Coins like Uniswap, Stonk. I don't have enough Stonk in my portfolio. So, we'll  talk about all of those. But first, let's talk about what actually happened. Yes, the bond yields  exploded. Yes, this is the 30-year Treasury bond. This is what the US pays to borrow for 30 years.  The US government pays to borrow for 30 years. And actually, if you look at where the bond yields  are now, 5.4%.

03:38 Actually, the 30-year bond yields have not been at these levels for the last 20  years or even more. Actually, the last 23 years, the last time that the US government paid 5.4%  to borrow for 30 years was 23 years ago. And so, yes, bond rates are very, very high. What does  that mean? It means that investors don't want to loan governments or specifically the US government  for 30 years unless they receive a big premium for their money.

04:11 Why is that? Well, they're scared  of inflation. They're scared of loaning the government now and that money being inflated  away. And so, two things basically happened yesterday which set off this yield thing, right?  The first thing that happened yesterday was guess what? We got the PMI numbers, right? Now, the PMI  numbers were actually good. So the PMI numbers basically show, it's a manufacturers' index which  basically shows how much the economy is expanding, how bullish the economy is, how positive the  economy

04:42 is, and the numbers were crazy, right? We expected a 53.7 on the PMI and we got 57 on the  PMI, which in a nutshell means that the economy is really, really hot. It means that people have  jobs. The economy is really, really hot and things are good. The problem with things being  good is that it means the economy could also be overheating. And when the economy is overheating,  it means that there's going to be inflation.

05:09 So, as soon as those numbers basically came out, what  you realized is that the chances of a rate cut, which is on the 28th of October, which is  the next CME, which is the next Fed meeting, went up to 73.1%. Now, I think this is very, very,  very close to midterms. In fact, let's actually see when are US midterms. I think it's like two  weeks before midterms.

05:33 Midterm elections. Let's have a look here. Tuesday the 3rd. So, you've  got the Fed meeting 5 days. Wow, that's crazy. Before the midterm elections and there's a 73.1%  chance that they're going to actually increase rates now. So because the US economy is doing so  well, investors are worried about inflation and because the investors are worried about inflation.

05:59 Effectively, what they're saying is if we're going to lend you money, you are going to need to give  us a much bigger premium. And they had this big, it doesn't look like a big green candle because  it's on a weekly, but if you go on the daily, we had this big green candle and the numbers  basically shot up and the 30-year went to 5.4. Even the 10-year which is the amount of  money that the US government or the rates that the US government pays to borrow money for  10 years also had a big green candle over here, right?

06:28 And so that's the first thing that  happened. The first thing that happened is we got the PMI numbers and guess what? The economy  is too good. Because the economy is too good, people must be negative because it means that  the Fed will actually pull up the handbrake and try and slow things down because things are  running too fast. That's the first thing that happened.

06:44 The next thing that happened was that  the US government wanted to auction its 5-year debt notes. In other words, when the US government  needs money, it goes to the market and it auctions debt. And in this case, they went to auction  five-year debt. And unfortunately, they didn't get as much of a supply as they wanted. Right?  So, it says here direct bidder stepped up, but that was not enough to offset the weaker indirect  demand.

07:09 And so we had a lower bid to cover ratio and the sizable tail shows that buyers required  a higher yield in the market. In other words, what they're saying is the US government went  to borrow money from investors on a 5-year time frame. And guess what they basically said? No, no,  no, no. We need a much higher interest rate. And so yesterday was a very bad day for rates, right?

07:28 So as ZeroHedge says, bonds crash most since liberation day after catastrophic 5-year auction.  So, it's not only the 5-year auction, it was the fact that the economy is too good and we had the  5-year auction, right? So, the bonds started to crash. The 30-year had a breakout, went to the  23 or 24 year ago levels. The 10-year also had a breakout. It's now 5%.

07:53 Let's just quickly go look  and see when the 10-year was last at these levels. The 10-year was last at these levels in 2007,  which was before the big collapse. And I think this is quite important that we realize that it  was just before the big collapse. So I think that we need to realize that right now people don't  really want government debt. And the reason why they don't really want government debt is because  they're saying, "Look, we know that governments are so much in debt that they can never repay the  debt

08:20 or at least they think that they can never ever ever repay the debt." And so they need a big  premium to fund the government debt because they know that governments are going to keep printing  money to pay off their debt. Because if you're the US and you've got $40 trillion worth of debt  and you got to refinance this at say 5%. So that's costing you $2.5 trillion a year, but your GDP is  not even that high, right?

08:41 Your GDP is not even $2.5 trillion a year. So now what do you do? Where  do you get how do you refinance your debt? Well, that's the problem. You have to start printing  money and then you devalue your money. And that's the whole problem, right? And that's  what the market's worried about. And that's why investors want a higher rate of interest  to loan the government money for such a long period of time.

09:02 That's basically what's going on  here. And it's actually not only the US. So yes, the US government bonds, no one wants US  government bonds. But the Japanese bond rates also went down. In fact, if you look at this  chart over here, it basically shows you that all bonds for all countries are basically requiring  a higher yield. People don't want government debt anymore.

09:22 And when they do, they want a very high  rate of return. So why is this scary? Why is your Twitter timeline getting scared about this? If  you are in crypto, you shouldn't be getting scared about this. If you are in stock markets, maybe you  could be getting scared about this. And the reason why it becomes so scary is if you think about an  investor who can get 5.4 and as Ben Cowen says, maybe even soon six to six and a half percent  for lending money to the US government.

09:51 There comes a point where when that interest  rate goes high enough they go, "Hold on a second, why should I have money in the stock market and  take a risk that the markets may crash when I can just hold US government debt and get 6%, 7%,  5%, whatever the number is?" And so there comes a point where when bond rates go up, when bond rates  go up, that people eventually say, "You know what, let me stop putting money into the market into  risk because I can get a risk-free rate of six or six and a half percent."

10:20 Right now, just to  give you some perspective, the S&P 500 pays a dividend yield of 1 to one and a half percent. And  so, at a certain point, investors are going to go, "Hold on a second. We can either put in the S&P  500, but the S&P 500's had a big run, and if the S&P 500's had a big run, then it'll probably  come down or there will be some correction, or I can just give it the government and just  get 6% risk-free."

10:40 And that is what the concern is or used to be. And I say used to be because I  think that was more of a concern before 2007. I think that in 2007 something broke. It was the  2008 housing crisis. Remember the 2008 housing crisis. So from that point, governments responded  by actually starting to print money, right? And so when they got into a crisis, they started to print  money.

11:07 And when they started to print money, that became good for stock markets. And so as you can  see with this chart, right? If you look at this chart in the since 2020, it shows that the 10-year  Treasury yields has been going up. But instead of the markets going down, which is what they used to  do in history, the markets actually go up. And the reason why the markets actually go up is because  they basically say, "Hold on a second.

11:27 How is the government going to trade out of this? They're  going to buy back their own debt. They're going to issue more money." And therefore, stock markets  basically don't respond to it anymore. So, it's not that scary anymore, right? And even if it is a  little bit scary for stock markets because even if at some point people would rather put their money  earning 7% with the government than or six or 7% with the government than actually putting it into  stock markets, what actually happens to crypto then and more

11:57 specifically what actually happens  to scarce assets then? That's where you can't lose sight of why we're actually here. Bitcoin loves  two things. The first thing it loves is increased liquidity and increased economic activity. And  you can see that every time that the ISM goes above 50, actually we start getting Bitcoin bull  runs, right? And this time's no different.

12:19 It was just a little bit delayed. But as soon as we got  to 50, 55 on the ISM, basically the Bitcoin bull run began. The second thing that Bitcoin loves  is when the Treasury has to start stepping in and buying back their own debt. Because as we  saw yesterday on the 5-year bid, no one wanted the debt. And so now the rates are going up. So  what's the plan?

12:40 What does Scott Bessent actually do at this point? How does Scott Bessent actually  get the long end of the curve down? And he has to do it because if he doesn't do it, the problem is  that he has to refinance all this debt, paying 5%. And if that happens, it deals an almost knockout  blow to the US, right? So what does Scott Bessent do? What's the endgame here?

13:04 First thing is, well,  he has to act. It's just a matter of time, but he has to act. And how does Scott Bessent act? Well,  probably the best way for him to act is what Luke Gromen says over here. I think I've got it over  here where he says he better get some balls and upsize his buyback to 20 or 30 billion. Otherwise,  it basically feels like this is all he's doing, right?

13:26 And so, he's basically saying, "Look,  Scott Bessent better come back to the market and start buying back his own debt to show the  market that he's serious." So option number one and probably the best option and probably the  only option is for the Fed to start printing money or the Treasury to start printing money and  actually buy back its own debt.

13:41 It's not unusual. The government is the one entity that can actually  create its own debt and buy its own debt. I know it's weird. I know it sounds weird. I know some of  your wives think that they can do it as well. It doesn't work like that. This is a thing that the  governments can do. Only governments can basically print debt, create IOUs, and then print money to  buy those IOUs and put the money into circulation.

14:08 Crazy, crazy, crazy story, but it can happen.  That's what governments basically do, right? Also, remember that Scott Bessent has a trillion dollar  account. It's called the Treasury General Account, and it's made for exactly this. It's made for  the Treasury to spend on things to stabilize the economy. It's got a trillion dollars, and  he'll probably start using some of that trillion dollars to buy back its own debt.

14:28 Remember again  that Scott Bessent was trained under George Soros and he is a mastermind in currencies, bonds,  interest rates, etc. And so rest assured that at some point he's going to act. And the only tool  that he actually has is money printing. That's the only tool that Scott Bessent actually has to go  and fight these bond markets. And he has to act.

14:57 He has no choice. He cannot leave, he cannot let  the bond vigilantes win because he says here the bond vigilantes are really good pot shop guys with  beer muscles, a good market intervention tends to focus their minds. In other words, what he's  saying here is just do a good market intervention and the bond vigilantes will basically leave  the debt alone.

15:10 So I almost think that Scott Bessent is waiting for the shorts to pile in and  then I think he's going to try and liquidate them because that's exactly his style, right? And when  he does, that means more money into circulation. So what am I saying in a nutshell? And I think  it's what James Lavish is saying and that's my mom on the phone. She should know I'm live now.

15:33 He  says, "Good morning. If you're selling hard assets like gold and Bitcoin as yields rise and bond  auctions become disorderly, you are not paying attention to the underlying problem and then  in the inevitable currency devaluation because ultimately they're just going to have to print  more money." And when they print more money, the assets that succeed are the assets that are  in scarce supply and in high demand.

15:51 That's pretty much the whole thesis. So, if you are panicking  because your timeline looks something like this. If you are panicking because your timeline looks  something like this, if you are one of these people that is dumping into this timeline, great.  But we shouldn't worry. And again, we're not going to worry until and unless we break below this line  over here.

16:16 And until we get to that level, and we will have a correction. I wouldn't be surprised if  we went back and we actually tested this line. We will have a correction to $78,000 at least. And  probably that correction will come pretty soon because to be honest, I haven't looked at the RSIs  for a while, but I imagine RSIs are pretty high. Let's have a look here.

16:36 Okay, so that's the RSIs.  That's RSIs on the daily. They're not too high. Let's look on the 4-hour. So let's look on the  weekly. I mean, they're not too high. The RSIs are starting to get stretched, but they're not too  high. They're not too high. I think this is fine. So, I think that for now, great. Let's wait for  a little bit of a pullback. As I've said before, I'm not deploying anything now, but it's probably  a good time to start thinking about all the things that you want to buy that you didn't

17:05 actually  manage to get your grubby hands onto, right? Like, I've got a couple like I said to you, like  Uniswap, I missed Uniswap. I really want Uniswap in my portfolio. I'm not paying $10 or whatever  else. What else is there? There's Uniswap that I want to put into my portfolio. There is Stonk  that I want to put into my portfolio. What else is there that I want to put in that I'll actually,  you know, maybe tomorrow we'll do a list.

17:26 I mean, there's Stonk again. It just keeps running away.  I think what we'll do, I think what we'll do is we'll actually make a buy list for people that  are already holding a good portfolio. What are we actually going to buy on this dip? Why does  Ran only read the part about Scott Bessent's CV resume which suits him? Scott's full resume is  not at all impressive.

17:49 Okay. Did you see Scott Bessent's resume? I mean, we know he worked with  George Soros. I don't know. Yes. So, we're not selling. This is the reason what's happening is  the reason why we're here in the first place. So, don't sell. Don't give them your coins. It's  the craziest thing that you could ever do. One of our trades which I posted in Front  Runners is actually starting to break out.

18:21 It's Compound. Lucky posted it first. I'm  still holding the position. It looks like it's breaking out. It's showing relative strength  when the market is not, when the market is. So, maybe something to look at. Again, I'm not really  buying too many things at the moment just because I think the RSIs are heated and I think there's  the risk return is maybe on a slight pullback before we go on another leg up.

18:39 Also because I'm  80, 90% deployed, right? It's like when you're 80, 90% deployed, you don't want to be deploying into  highs like that. Cool. What else is there? So, I want to show you something specifically if you  have assets and you want if you have crypto assets and you want to hold them, but you also need  cash. So, how many of you are in a position where you have Bitcoin, you have Ethereum, you have  some other tokens, you need some spending cash, but you don't want to let go your actual assets,  right?

19:09 So, there is actually a solution for people like that. There's two reasons why you'd want to  hold on to your assets. The first reason why you want to hold on to your assets is because you  think Bitcoin is going to appreciate. You need some spending cash. And I'm not saying you got  to leverage your entire Bitcoin. But let's say you own one Bitcoin.

19:26 It's worth $80,000 today. You  need $5,000 or $10,000 to, I don't know, survive, have fun, whatever. What you can do is you can  actually take a loan against your Bitcoin. So, that's what actually rich people do. And the  reason why rich people actually do that is because they never want to pay tax. So as soon  as you sell the Bitcoin, you pay capital gains tax.

19:45 But if you never sell the Bitcoin, you never  pay capital gains tax, right? So what do they do? They basically loan, they put their Bitcoin into  a loan provider. And this is where Nexo comes in. So Nexo is one of our partners. Again, I don't  usually promote these kind of things unless these are things that I do or would use myself, right?  And Nexo is one because Nexo has been here for a long time.

20:06 Effectively what you do is you  go to their market effectively. Let's go to their dashboard basically. So you go here, you can  deposit Bitcoin, you can earn up to 5.7%. And you can actually borrow against Bitcoin. So you can  give them your Bitcoin and you can actually borrow against your assets which means that you basically  get stablecoins against the assets, right?

20:28 So, this is and they have a whole lot of assets that  you can actually do this with. I see they've also got an exchange. They've also got an exchange  thing here. Yeah, they've got futures. I didn't actually know that they had all of these things.  What I do use them for is to actually loan against assets. So, you give them your assets. You borrow  stablecoins against them.

20:51 And when you return the stablecoins, you basically get your asset back and  you never pay tax. So if you want to, let's say for example, you just need some spending money  to carry you through at the end of the month, etc., etc. You want to buy a car, but you don't  want to, you don't want to let go of your Bitcoin because you're going to need to pay capital gains  tax, then you'd go to a platform like Nexo.

21:08 So, they are one of our partners. If you want to  support them and you actually need the service, then go to the link below. There's a Nexo link  below. There's a Nexo link below. Yeah. And then and and basically just borrow against Nexo link  below. Yeah. Borrow against your assets. There's a Nexo link below. Sorry. Yeah, just borrow  against, you can literally just borrow against your assets.

21:35 Also, while we're here, if you are in  the US, reminder, there's a $5,000 giveaway if you open a Kelshi account. If you want to trade per  legally in the United States, you can use Kelshi. They've got the pro mode as well, which is this is  their pro mode. See, Bitcoin's up at $84,000. So, there's a $5,000. If you open an account using the  link below, you can stand a chance to get $5,000 deposited into your actual account.

21:55 I think that's  it. I think for now, don't panic. For now, start thinking about what you're going to buy if the  market actually pulls back. I wouldn't be spending now. It's just one of those where you just sit  and wait and I'll let you know exactly when to buy. All right, my friends. I'll see you again  tomorrow. Until then, trade well, my friends.