You
don’t
need
me
to
tell
you
that
bitcoin
(BTC)
has
been
on
a
tear.
The
first
and
largest
cryptocurrency
by
market
cap
is
up
over
6%
just
in
the
past
24
hours,
after
crossing
a
supposedly
psychologically
important
threshold
of
$65,000
according
to
CoinDesk
Indices
data.
It’s
now
within
striking
distance
of
its
all-time
high
around
$69,000,
last
seen
at
the
end
of
2021
—
before
the
bad
things
happened.
Many
people,
even
industry
insiders,
have
been
taken
aback
by
the
price
action,
given
how
bleak
market
sentiment
around
crypto
was
even
just
a
few
months
ago.
Not
even
a
major
exchange
like
Coinbase
saw
it
coming,
given
that
a
boost
in
trading
activity
caused
(another)
outage.
It’s
enough
of
a
surprise
that
some
people
feel
hesitant
to
say
this
is
the
beginning
of
another
bull
run,
given
that
things
could
fall
back
as
quickly
as
bitcoin
ran
up.
This
is
an
excerpt
from
The
Node
newsletter,
a
daily
roundup
of
the
most
pivotal
crypto
news
on
CoinDesk
and
beyond.
You
can
subscribe
to
get
the
full
newsletter
here.
But
there
are
legitimate
differences
that
already
set
this
cycle
apart
from
the
2020-21
hype
cycle
—
with
the
bear
market
washing
out
some
of
the
worst
aspects
of
the
industry.
Is
it
necessarily
the
case
that
rising
interest
in
crypto
be
coupled
with
fraud,
crime
and
cringe-worthy
behavior?
Though
it’s
dangerous
to
say
it,
this
time
could
be
different.
First,
there’s
the
multi-billion
dollar
question:
Will
spot
bitcoin
exchange-traded
funds
continue
to
grow
and
grow.
The
10
live
funds
have
seen
$8
billion
in
net
inflows
so
far,
which
has
not
only
helped
re-legitimize
crypto
given
the
involvement
of
trustworthy
financial
institutions
including
BlackRock,
Fidelity
and
Bank
of
America’s
Merrill
Lynch,
but
also
placed
significant
buying
pressure
on
the
underlying
commodity,
bitcoin.
It’s
possible
ETFs
have
changed
market
dynamics
by
giving
a
safer
way
for
people
to
gain
exposure.
If
anything,
these
ETFs
prove
that
there
was
latent
demand
for
bitcoin
from
all
corners
of
the
market,
from
retail
investors
to
ultra
high-net
worth
individuals
asking
their
banks
for
crypto
exposure.
BlackRock’s
bitcoin
ETF,
for
instance,
is
the
first
fund
to
reach
$10
billion
in
assets
under
management
this
quickly
—
and
some
say
the
next
$10
billion
could
flow
in
even
faster.
See
also:
Welcome
to
the
‘Bitcoin
Era’
on
Wall
Street
|
Opinion
But
TradFi’s
attention
isn’t
fixated
solely
on
ETFs.
CME
Group’s
crypto
derivatives
products,
typically
viewed
as
a
proxy
for
institutional
interest,
are
experiencing
record
volumes.
A
similar
trend
happened
last
cycle,
where
interest
in
crypto
begets
more
and
more
interest
from
more
and
more
sectors.
The
more
crypto
goes
up,
the
more
people
want
to
play
with
it.
Celebrities
aren’t
here
Interestingly,
the
current
cycle
hasn’t
attracted
the
same
level
of
involvement
from
celebrities
—
at
least
yet.
This
could
be
a
factor
of
not
having
a
figure
like
Sam
Bankman-Fried
who
wanted
to
buy
public
trust
in
FTX
by
bankrolling
celebrity
endorsements.
It’s
possible
the
SEC
suing
Kim
Kardashian
or
the
cast
of
characters
who
allegedly
advertised
TRON
without
disclosing
it
will
keep
Hollywood
at
bay.
Of
course
all
this
could
change
—
Paris
Hilton
could
trot
out
her
Bored
Ape
again
any
day
—
but
for
now
the
lack
of
“influencers”
is
a
positive
development
considering
that
research
shows
how
poorly
their
investment
“advice”
tends
to
be.
Likewise,
the
voices
that
dominated
the
last
cycle
—
figures
like
Alex
Machinsky,
BitBoy,
Changpeng
Zhao,
Do
Kwon,
SBF,
Su
Zhu,
etc.
—
largely
have
been
discredited,
and
it
seems
like
this
is
a
power
vacuum
crypto
is
hoping
stays
empty.
See
also:
Could
Sam
Bankman-Fried’s
Saga
Happen
Without
Crypto?
|
Opinion
That
in
itself
could
be
wishful
thinking,
and
it’s
worth
considering
why
influencers
emerge
in
the
first
place.
One
theory
is
that
crypto
has
influencers
because
crypto
prices
are
self-reflexive
(aka
“number
go
up
technology”),
and
someone
tends
to
emerge
to
coordinate
attention
towards
one
project
or
another.
This
is
amplified,
as
Bloomberg
notes,
by
the
ability
for
traders
to
load
up
on
borrowed
funds,
gaining
leverage
to
try
to
max
out
trading
profits.
Given
the
amount
of
credit
already
building
up
in
crypto
markets
(open
interest
in
bitcoin
futures
is
up
90%
since
last
fall
on
platforms
like
Binance,
OKX
and
BitMEX,
which
can
be
leveraged
up
to
100x)
and
the
tremendous
amount
of
capital
flowing
into
meme
coins
like
DOGE
and
SHIB,
it’s
clear
enough
people
are
looking
to
gamble
big
this
time
around,
too.
Institutional
lending
While
the
laws
in
the
U.S.
haven’t
yet
changed,
over
the
past
few
years
notable
advancements
including
the
E.U.’s
MiCA,
UAE’s
digital
asset
trading
licensing
program
and
lobbying
efforts
in
places
like
Canada
mean
more
traders
could
soon
have
more
regulated
means
of
gaining
access
to
crypto
derivatives.
There’s
a
hope
that
the
crypto
lending
sector
won’t
take
as
nasty
a
turn
as
last
time,
given
that
it
ended
up
being
dominated
by
a
handful
of
now
bankrupt
“hedge
funds”
like
Alameda
Research
and
Three
Arrows
Capital,
which
were
supposed
to
be
generating
the
yield
paid
to
customers
of
now
bankrupt
lending
platforms
like
Celsius,
BlockFi
and
Genesis.
For
instance,
tokenization
giant
Securitize,
recently
spun
up
an
“Earn”
program
that
offers
yields
via
over-collateralized
loans
and
tokenized
funds
for
financial
titans
KKR
and
Hamilton
Lane.
For
now,
while
still
assessing
demand
for
the
product,
Securitize
itself
will
be
paying
for
it
is
billing
as
“sustainable”
yield
to
users
off
its
balance
sheet,
Reid
Simon,
Securitize’s
head
of
credit,
told
CoinDesk
in
an
interview.
This
in
itself
is
an
interesting
move,
signaling
how
important
lending
programs
are
as
one
of
the
few
ways
to
put
digital
assets
towards
productive
use.
“It’s
a
business
we
want
to
get
into,”
Simon
said,
noting
that
it’s
“unclear”
how
well
the
crypto-native
firm’s
brand
has
resonated
with
crypto.
“I
don’t
necessarily
think
of
Securitize
and
bitcoin
together,”
he
said.
Other
crypto
lending
operators
have
spoken
at
length
about
the
ways
things
went
off
the
rails
last
time,
and
others
have
noted
there
are
ways
for
the
industry
to
self-regulate,
like
by
separating
crypto
trading
from
custody
and
advocating
for
proof-of-reserves.
There’s
no
guarantee
the
same
mistakes
won’t
be
made
again
(or
that
bitcoin
will
continue
to
climb
if
it
regains
its
all-time
high
at
all).
It’s
worth
noting
the
recent
rally
has
come
alongside
significant
advancements
on
the
S&P
500
and
Nasdaq
indexes
and
renewed
growth
in
the
U.S.
tech
sector,
surprising
many
on-lookers
who
thought
raised
interest
rates
would
keep
capital
out
of
risk-heavy
sectors.
It’s
possible
that
crypto
is
doomed
to
Sisyphean
cycles
of
rising
rates
of
illicit
use,
fraud,
speculation,
cringe-inducing
endorsements
and
greed
every
time
prices
boom,
simply
by
nature
of
how
these
hype
cycles
unfold.
But,
for
now,
with
the
worst
aspects
of
the
industry
washed
out,
and
many
wanting
to
do
things
differently
(read:
legitimately),
it’s
worth
hoping
things
won’t
take
a
turn
for
the
worse.
Must
everything
that
goes
up
turn
down?
Is
this
time
really
different?