Good morning investors; I just wanted to thank you for reading this publication, and if you haven’t already, make sure to join 843 other readers to stay up to date on everything in the financial markets.

Today You’ll Learn:

• Will BTC Drop Big One More Time?

• Inflation Number Came In: It’s Bad

• How Bad Federal Spending Is Getting

• & Much More!

📉 Will BTC Drop Big One More Time?

Bitcoin has been on a tear since the start of the year; as of writing this, it’s currently up +65%

Who said you couldn’t make money in a bear market? 👏

Here are 4 reasons we could see BTC’s price fall a significant amount:

1/ High Transaction Fee Spikes

Recently, BTC’s transaction fee spiked by ~1,000% during the whole memecoin mania.

This is solely due to the new addition of BRC-20 tokens on the Bitcoin network, which allowed ANYONE to add tokens onto the blockchain… Which is precisely what happened.

The Bitcoin network at one point had ~400k unconfirmed transactions sitting on its blockchain. This caused a massive spike in the transaction fees on BTC’s network.

As you can see, I’ve created quite a complicated and complex chart that tracks what happens when transaction fees spike on the BTC network.

Red = BTC Fees / Blue = BTC Price

Whenever BTC fees spike to the upside, the price of BTC drastically falls right after for months.

The fees also usually spike after the price of BTC has increased significantly, and remember how we mentioned BTC has already gone up +65% since January 1st…

What goes up must come down 😅

2/ The Year Before The Halving

Everyone and their grandma knows that the year after the BTC halving, the price EXPLODES to the moon, and everyone remembers why they HODL through bear markets.

But what happens the year BEFORE the halving?

2015 did reasonably well right before the halving, but retail investors strictly decided the price like you and me at this point.

I mean, BTC’s market cap was only $3 billion at that time…

In 2019, things didn’t look as promising. If you look at the chart above, the last half of the year, every month, was in the red except for one.

Fast forward to today, we’ve already gone up +65% to start the year, and the signals of recession, bank failures, and global troubles seem to be heating up.

Another big thing to remember is that in 2015 the whole BTC market was purely speculation and retail investors. Today we also have billion-dollar investors participating, who usually like to manipulate the markets to their favor if they can.

3/ Retail Investors Are Capitulating

This is more of a joke, but all jokes contain some truth, don’t they…

If you look at the general interest in crypto over the last year, it has fallen significantly.

While you shouldn’t take this chart as gospel, looking at what retail investors are doing is essential.

Most of the time, you want to do the OPPOSITE of what they’re doing!

From the start of March to Now, YouTube views, specifically around crypto channels, have fallen +50%

This is important because this is a sign that:

• The crypto markets are getting weaker (Fewer investors)

• Once all retail loses interest, that’s when big money comes in

4/ Binance Is In Some Trouble

Here’s a list of reasons why the 3rd largest crypto exchange in the US may be in some trouble:

• Liquidity Issues: BTC was trading at ~$700 premium, meaning you’d pay more for BTC on Binance.US than you would on Coinbase

• Regulations: Binance and the SEC are not getting along together & the CFTC also is having some issues with Binance

• Withdrawals: Tons of investors are taking their money out of Binance and into cold storage, including their largest waller used for staking

While there are loads of other metrics that you can look at that may say a different story, it’s always better to be prepared for the worst but hope for the best

😅 Inflation Is Not Looking Good

The CPI report recently came out, and if you look at mainstream news, you’d think the numbers were good and that we’re moving in the right direction.

But if you decide to take a little bit of a deeper look, you’ll see there’s a forest fire behind this whole smoke show

Here are some significant numbers that came from the CPI report:

1/ Headline inflation YoY (Year-over-Year) fell from 5.0% → 4.9% YoY

Idk about you, but I like my inflation falling faster than 0.1%…

2/ If you look at headline inflation MoM (Month-over-Month), it ROSE 0.4%

Not sure how that’s a good sign?!?

3/ Core Inflation also rose MoM from 5.1% → 5.5%

Core Inflation = Inflation - Energy & Food

4/ Core inflation YoY is the same in April as it was in February… 5.5%

We’re making some real progress here, boys!

Many people will rejoice because, for the first time in 2 years, we’re under 5% inflation.

But really, step back and ask yourself, is that something to be cheering about?

📊 Indicators of the Day

1/ Federal Spending On Senior Citizens

We are already spending ~40% of taxes on seniors; in 20 years, entitlements will jump up to 60%.

2/ US Debt Has Doubled In The Last Decade

All of this debt comes with empty promises and high inflation, sadly.

📺 What To Watch Out For

Great Britain GDP Announcement: Friday, May 12th

• All of Europe is struggling right now for various reasons, so some good number would really help them out here

🗞️ Top Headlines

• BlockFi Can Return Nearly $300M to Some Wallet Customers, Judge Rules: Keep your eyes out for this if you lost money with BlockFi

• Debt Ceiling Meeting Postponed: Let’s see if they can come up with some good answers this time around.

🐦 Twitter Takeaways

But, We’re The US Gov’t

Stan Drunkenmiller Economic Report

🤔 Did You Know

The United States has doubled its debt from ~15T → $31T within 10 years.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell assets or make financial decisions. Please be careful and do your own research.