SX Crypto Advisor Weekly Update
It has been a bullish weekend for crypto after SEC Chairman, Gary Gensler, issued a statement saying that Bitcoin and Ethereum should be regulated by the Commodities and Futures Trading Commission (CFTC), while “tokens” or cryptocurrencies that share the characteristics of equities should be regulated by the Securities and Exchange Commission (SEC).
This has been our position here at Cabot SX Crypto Advisor since we launched the publication. We spoke about this in our very first webinar. This news from the SEC Chairman is encouraging because it provides much-needed regulatory guidance for the markets and Bitcoin has rallied as a result.
Ironically, the former SEC Chairman, Jay Clayton just joined the advisory board of Electric Capital – a web3, cryptocurrency, and fintech-focused investment firm. Clearly, he also believes crypto markets are here for the foreseeable future.
Currently, the leaders of the Senate Agriculture Committee, which oversees the CFTC, are pushing legislation that would clearly give the CFTC oversight over Bitcoin (BTC) and Ethereum (ETH). This makes sense because the CFTC regulates derivatives.
It feels like we are coming closer and closer to very pivotal moments for DeFi.
Unstoppable Global Expansion
According to financial services giant HSBC, more than 500 million new global investors are expected to purchase cryptocurrency by 2030. This growth is based on the extrapolation of historical growth rates and is expected to be led by Asia, South America and Africa. A significant portion of the U.S. retail population owns a small portion of cryptocurrency, while more growth in the U.S. is expected to come from large institutional investors.
MicroStrategy, a public software company run by notorious Bitcoin bull, Michael Saylor, is raising $500 million to purchase more bitcoin according to SEC filings. Crypto games and metaverse projects raised almost $1 billion in August alone.
Google’s web browser is now counting down the days until the Ethereum Merge, a sign of support and recognition from the world’s most popular search engine. The shift is imminent for Ethereum. The network upgrade will reduce the energy consumption of miners. This will reduce the scrutiny from European regulators and improve the efficiency of the network.
While other tech companies report layoffs, our portfolio company Polygon (MATIC) – which is trading quite well I may add – is growing its workforce by 40% in the coming months according to Bloomberg! They just announced a new partnership with Disney; the company is poised to benefit as larger enterprises continue to adopt new strategies for running on Ethereum.
Crypto Portfolio
| Ticker | Initial Weight | Price | Price at Rec | Performance | Rating |
| ETH | 18.0% | 1,726.28 | 3,444.22 | -49.88% | BUY A HALF |
| ENS | 7.00% | 15.07 | 10.22 | 47.46% | BUY A HALF |
| MATIC | 7.00% | 0.93 | 0.678 | 37.89% | BUY A HALF |
| APE | — | 5.38 | — | — | WATCH |
| SOL | — | 37.64 | — | — | WATCH |
| HNT | — | 5.10 | — | — | WATCH |
| STEPN | — | 0.7379 | — | — | WATCH |
| AVAX | — | 21.40 | — | — | WATCH |
| LINK | — | 7.81 | — | — | WATCH |
Equity Portfolio
| Ticker | Initial Weight | Price | Price at Rec | Performance | Rating |
| Proshares Strategy Bitcoin ETF (BITO) | 2.50% | 13.85 | 25.93 | -46.59% | BUY A QUARTER |
| Arista Networks (ANET) | 2.50% | 124.74 | 105.00 | 18.80% | BUY A QUARTER |
| Nvidia (NVDA) | 2.50% | 145.05 | 188.20 | -22.93% | BUY A QUARTER |
| Okta Inc. (OKTA) | 2.50% | 64.8 | 95 | -31.79% | HOLD A HALF |
| Block Inc. (SQ) | — | 75.24 | — | — | WATCH |
| Concord Acquisition (CND) | — | 10.07 | — | — | WATCH |
| CrowdStrike (CRWD) | — | 195.1 | — | — | WATCH |
| Galaxy Digital (GLXY.TO) | — | 8.22(CAD) | — | — | WATCH |
| Proshares Short Bitcoin ETF (BITI) | — | 33.69 | — | — | WATCH |
| Unity (U) | — | 42.27 | — | — | WATCH |