PTGR – Strategic Digital Asset Management



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Dear valuable clients,

Please find the following key insights from our aggregated research:

Overall Take-Home Message:

The Bitcoin price continues to consolidate between $16,000 and $17.000, supported by a trend line. The tight consolidation shows that both bulls and bears are unsure of their positions. Bitcoin January All-Time high was back in 2021 around $47,000. When Bitcoin tries to move out of its post-FTX trading range in the coming weeks and months, anything can happen. BTC/USD is currently down over 60% year-to-date, with few bullish supporters as 2023 starts.

The volatility of cryptocurrencies is another justification for investors to play a steady long game. Don’t be concerned with short-term volatility if you’re buying with the intention of long-term gain. The best course of action is to “set it and forget it” and stop thinking about your investment. Every time there is a price movement, whether it is up or down, we continue to warn that emotional reactions can lead investors to act hastily and make choices that cause them to lose money on their investment.

People continue to be interested in cryptocurrency, and it  keeps being a hot issue in popular culture thanks to everyone from seasoned investors like Elon Musk to that Facebook friend from high school. But how far can Bitcoin advance over the long run? Despite bitcoin’s rough start to the year, analysts continue to predict that it will reach $100,000; it is more a question of when than if. According to Kiana Danial, author of “Cryptocurrency Investing for Dummies,” Bitcoin’s background may offer some hints as to what to anticipate moving ahead.

Long-term forecasting is challenging, but in the near future, industry professionals will be watching developments like institutional acceptance of cryptocurrency payments and regulation to attempt to gain a better understanding of the market.


1) What happened in December?

With a major portion of conventional venture capital companies placing significant bets on the ecosystem in 2021, 2022 was expected to be the year when cryptocurrency became widely accepted. However, with one catastrophe after another, 2022 ended up being a disastrous year for the fledgling crypto sector. Some of the most prominent figures hailed as essential to advancing the cryptocurrency ecosystem actually played a major role in planning its worst year in recent memory.

Despite this, several of the heroes performed admirably. These victors demonstrated that the cryptocurrency industry is a thriving ecosystem that can withstand major setbacks, rather than simply a small group of elite individuals and businesses.

The recent decline of Bitcoin [BTC] to a low of $16,000 has been devastating for many individuals. The bear market, however, appeared to be advantageous for investors trying to increase their reserves. The market is routinely avoided by retail investors when bears strengthen their holdings.

However, despite having a significant position, the bulk of institutional investors continue to add to their coin collections. Every time the price of Bitcoin declines, MicroStrategy often joins the market. The business has once again taken advantage of the recent decrease in BTC by buying more Bitcoin for $41 million.

According to information from the SEC, MicroStrategy increased its reserves by 2,500 Bitcoins for a total of $41 million. The company had 132,500 Bitcoin as of December 27, 2022, which it purchased for $4.03 billion, or an average price of $30,397 per BTC.

It’s hard to pick winners in a year that saw the multibillion-dollar failures of the Terra ecosystem, FTX, and Three Arrows Capital. However, 2022 was just another year that cryptocurrency faced threats. Despite the demise of several centralized institutions, the year saw a few beneficial outcomes.

In the FTX wreckage, many crypto investors lost faith in centralized exchanges. Investors’ trend toward self-custody has benefited hardware wallet companies like Ledger and Trezor. Self-custody services and hardware wallets were the go-to options for many people by December. Trezor had a 300% increase in sales and income following the demise of FTX, and Ledger saw its greatest selling day ever.

A recent study by Uswitch, an internet and phone services researcher, looked at fixed internet speeds, internet package costs, the amount of blockchain financial start-ups, and the pricing of high-tech exports to decide whether nations are ready to embrace the metaverse.

The Netherlands are first on the list, followed by Switzerland, Lithuania, Malta, and France. It is well known that all of the nations in the top five spaces have expressed interest in developing in the Web3 area.

Users of MetaMask may soon buy and send Ether using the digital payment service PayPal, thanks to a partnership between PayPal and the parent firm of MetaMask, ConsenSys. The service will initially only be available to a limited number of American PayPal customers, given the US is one of MetaMask’s main user markets, according to the statement made on December 14. By simply logging into their mobile MetaMask app, users will be able to buy and transfer ETH from PayPal to MetaMask without any issues. They will then be redirected to their PayPal account to complete their transactions.

A proposal describing how Ethereum users might set up automated payments straight from their own, self-custodial wallets was recently published by Visa. By doing so, it will take banks and other centralized organizations out of the picture.

A group of scientists and engineers from Visa is examining the theoretical underpinnings of several blockchains. Security, scalability, interoperability, privacy, and use cases for various protocols are the main focus areas.

With all these payment bridges between the fiat and digital asset ecosystems in the works, further adoption in the space is inevitable.

2) Where do we stand?

Dante Disparte, chief strategy officer and head of global policy at Circle, thinks that the instability in the cryptocurrency market over the last year may have signaled the transfer of crypto technology to “steadier hands” and more resilient businesses in 2023. Disparte noted the expanding use of cryptocurrencies in the financial services industry in a post for the World Economic Forum (WEF) on January 2. He also expressed his opinion that the current bear market and exchange collapses may ultimately be beneficial for the sector, paving the way for “responsible, always-on internet finance.”

Perhaps 2022 will see a transfer of crypto technology and blockchain infrastructure to steadier hands, he suggested. “Just as it took the dot-com bubble bursting in the early 2000s to hand over the future of the internet to more durable companies, business models, and use cases, perhaps 2022 marks a handover of crypto technology and blockchain infrastructure to steadier hands.”

When compared to commodities like gold or silver and other top technology stocks like Apple and Microsoft, Bitcoin is still in its early stages of price discovery given that its journey as an asset just started a little more than ten years ago. As a result, even if there are many projections for the price of BTC, it’s important to keep in mind how little cyclical data is really available for these models to use.

Nonetheless, one crucial factor—utility—could alter the patterns in the price of Bitcoin. The utility of Bitcoin has been restricted to a payment rail since the network is not compatible with smart contracts. That is gradually starting to change as Bitcoin now has more uses than ever thanks to the Lightning Network.

On top of the Bitcoin network, LN is a layer-2 payment system that enables quick, seamless peer-to-peer transactions. It makes a significant contribution to the network’s scalability. Most recently, MicroStrategy, a company founded by Michael Saylor, declared its intention to introduce Lightning Network-powered software and solutions in 2023.

Last year, the Ethereum network outperformed Bitcoin in terms of overall transaction volume, but the king of cryptocurrencies still holds the top spot in terms of internet search interest. On January 2, information from Nasdaq and Ycharts was posted on Reddit, claiming that in 2022 there would be 338% more Ether transactions than Bitcoin transactions.

However, compared to the Ethereum network, which had far more transaction volume fluctuation, the amount of transactions on the Bitcoin network was more regular and stable. This was brought on by increases in demand during particular events, such as NFT launches.

According to Bitinfocharts, Ethereum’s higher transaction volumes have continued into the new year, with the total number of transactions on Jan. 2 hitting 924,614, a 300% increase over Bitcoin’s 229,191 transactions that day.

On Chain Data:

The ETH narrative in 2023

With all that said, what has 2023 in store for ETH? The market for layer-1 blockchains has saturated due to the recent rise in alternative layer-1 blockchains, and many in the crypto industry doubt the necessity for more block space.

Despite the trend toward long-term core protocol ossification, Ehereum’s successful Merge of its consensus and execution layers in September 2022 has bolstered the argument for ambitious future upgrades.

Given that practically all networks are vying for the same pool of investors and users, this supports Ethereum’s narrative of becoming the leader in a multichain era. However, as the network depends on layer-2 scaling strategies to expand its block space, which come with their own concerns, Ethereum’s dominance may still be threatened in other ways. It involves, among other things, centralized sequencers, a lack of fraud safeguards, and a lack of cross-L2 compatibility.

Stablecoin reserves on spot exchanges have fallen to their pre-bull run levels.

Stablecoins like USD Tether (USDT) and USDC are crucial for fueling upsurges in bitcoin prices. And, as stablecoins reflect the point of entry—the conversion of fiat to cryptocurrency, the movement of USDT and other stablecoins within the ecosystem can impact the BTC price.

Currently, the stablecoin reserves on spot exchanges have fallen to their pre-bull run levels. At the same time, stablecoin inflow volatility has reached a record high.

The growing Stablecoin exchange influx indicates higher demand for assets like Bitcoin.Usually, before a trend reversal and a rally in BTC, holders of stablecoins in huge volumes boost their transfers to exchanges.

It seems Bitcoin is getting ready for the next bull run as demand rises and stablecoin inflows become more volatile. But the question is, for how long?

Bitcoin is still not undervalued

The price of BTC has already gotten to an undervalued level, according to several cycle indicators and on-chain data like Puell Multiple, MVRV, NUPL, SOPR, etc. These cycle signs aid in understanding the overall phase, but pinpointing the precise buying window can be challenging. The UTXOs in profit and loss indicators are a viable substitute for this.

A cross in UTXOs’ profit and loss confirms that BTC is undervalued and generates a buy signal for the cryptocurrency. The cross is yet to happen, so BTC is still not undervalued.

In the past, the BTC price reached a floor and experienced three consecutive halvings when UTXOs in the profit and loss indicators crossed. Bitcoin may fall sharply once a cross appears in the chart above.

While other on-chain data aids in understanding the general BTC phase, the buying time is tough to determine. A cross will offer a crystal-clear buying window.

3) Outlook: What could happen?

Crypto news for the weeks ahead

In 2022, crypto delivered its worst performance since 2018, but investors are hoping 2023 will usher in a repeat of the 2019 market rebound.

Crypto exchange Bitbank projects Bitcoin prices will recover to between $20,000 and $50,000 in the second half of 2023, but only if the Federal Reserve can stop interest rate hikes by mid-2023 and begin cutting rates by early 2024.

VanEck analyst Matthew Sigel has predicted Bitcoin will recover to $30,000 in 2023, but warns it could remain in the $10,000 to $20,000 range in the first quarter of the year.

Standard Chartered has cautioned investors that the crypto winter will extend into 2023, leading to more liquidity issues and bankruptcies, as well as further deterioration of investor confidence. Standard Chartered says Bitcoin prices could fall another 70% to around $5,000 in 2023.

Bank of America analyst Alkesh Shah says recent cryptocurrency price declines and bankruptcies have overshadowed the long-term thesis for digital assets and blockchain technology. The top 100 cryptos are still up more than 2,000% on average since the end of 2016, and developer blockchain activity actually accelerated in 2022.


NFT Notable Project – BEEP BOOP BOTZ

A well thought out P2E game, with many blue-chip NFT collectors buying into the game ecosystem. A game where it gives holders the ability to yield $ETH via their native token $BOOP.

Beep Boop Botz is a staking game, but also has the added dimension of battle mechanics. When your AI robot is not battling, it is earning you $BOOP tokens while in the (staking) holding zone. Every player needs to find the right balance between staying alive (winning), and achieving their yield/staking goals.

Beep Boop Botz is the main collection, where 10,000 adorable and goofy bots thrive on the Ethereum blockchain. Each Beep Boop Botz is an access pass (NFT to the BBB universe. Minters of Beep Boop Botz were given a Box which gifted a bunch of airdrops for other Beep Boop Botz assets. The in-game utility token $BOOP powers the Beep Boop ecosystem. Holders can access art, enjoy drops, upgrade Beep Boop Bots, and build an army of bots by earning $BOOP. Holders can also cash in $BOOP for $ETH.

The team is anonymous and is adamant about remaining that way. As evidenced on Twitter, many participants have sold their blue-chip NFT projects to get into the ecosystem. BBB is more of a web3 game than an NFT project. If you set it up correctly, you can earn some serious passive income.

Currently, $BOOP is trading at $0.05 and is listed on CoinGecko and CoinMarketCap. You can buy and sell the token on Uniswap. The team has developed an in-game wallet so players can enjoy their staking rewards without needing to claim them through a transaction, unlike other staking games that force players to do so. However if you want to cash in your $BOOP you will have to take the in-game currency and transact on chain (fees are associated with this conversion)


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