Welcome to November!

A look at what's happening in bitcoin and traditional markets as we enter November 2023.

Welcome to November!

October 2023 is in the books.

With the passing of another Halloween, we enter bitcoin’s 15th year on earth! The bitcoin white paper, outlining Satoshi Nakamoto’s premise for bitcoin, was released on October 31, 2008 to a group of cryptographers.

Learn More: Bitcoin & Halloween

The key takeaway here is that bitcoin hasn’t gone away. In fact, it’s done the exact opposite. Bitcoin adoption continues to grow and October 2023 is proof positive that we could be in store for significant institutional adoption in the near future.

“Uptober”

In October, bitcoin rose close to 25%.

Historically, bitcoin has fared well in October. The “Uptober” trend is nothing new.

Bitcoin’s continued success in 2023 comes as equity markets are cooling off despite first half surges alongside alternative risk assets like bitcoin.

100% YTD

At the October close, bitcoin is back to gains of more than 100% year-to-date.

The sharp upward swing in October is attributed to optimism around the potential approval of a US spot bitcoin ETF product. While it still remains to be seen when and if an ETF will be approved, BlackRock continues to lead a group of top tier financial institutions and investment firms who have active ETF applications with the SEC.

4th Halving

We also hit the six month countdown to the fourth bitcoin halving in the end of October. The upcoming bitcoin halving means that the total supply of new bitcoins released into circulation daily drops from 900 to just 450.

Learn More: 450 Bitcoin Per Day

Supply Shock

Anticipation of the next bitcoin halving is ramping up competition between bitcoin miners and institutional and retail investors. The halving, combined with the potential spot bitcoin ETF approval is setting us up for an unprecedented supply shock come mid-2024.

There’s already not a lot of bitcoin to go around. Exchange liquidity continues to drop as bitcoiners exit to self-custody. Retail and institutional investors front-running any potential ETF product will only further squeeze exchange liquidity and we could see wild price volatility post-halving as supply and demand incentives become abruptly apparent to anyone in the bitcoin and investment space.

FTX

November marks one year since the collapse of FTX and Sam Bankman-Fried’s fraud trial is unfolding as we speak. It’s a harsh reminder of the pitfalls of irresponsible and, in some cases, criminal third parties that seek to take advantage of retail investors in a burgeoning “crypto” space.

Bitcoin, however, shines in these moments. Self-custody bitcoin held privately is immune to bad actors like Bankman-Fried.

Learn More: Self-Custody Bitcoin

The bitcoin market has recovered from the initial FTX fallout but it makes us wonder where we could have been now had the FTX collapse not occurred.

Macro

In the US, the Fed is “not thinking about rate cuts right now at all” according to Fed Chair Jerome Powell. Higher, longer, is the current path forward.