11th May 2022 > > UST and Coinbase.

tl;dr

UST continues to lose credibility, whilst Coinbase tries to regain some.

Market Snap (at time of writing)

Market Wrap

The 2.5% rally in 10 years over 2 days has largely calmed risk markets from their earlier panic, but the travails of UST (see more below) will weigh heavily on cryptos.

Occasional Series – Another operation tomorrow

It’s so dull. Never quite sure if I will be in longer than expected or wanted. See you in a day or more.

Curious Cryptos’ Commentary – TerraUSD (UST) update

Currently trading at 40c, the market seems to have lost confidence in the UST peg (see yesterday’s CCC for more details). The trader in me is interested in buying soon … (NOT investment advice).

LUNA is down 80% in the last 24 hours and is now less than 5% of its value back in April.

The worrying question concerns Luna Foundation’s plans for the 40,000+ BTC it owns in its treasury, which is approximately half the market cap of LUNA.

Markets are fragile enough as it is without a forced seller of over a billion dollars’ worth of BTC needing to be moved in a hurry.

Curious Cryptos’ Commentary – Coinbase (COIN)

1st quarter results from Coinbase do not make for enjoyable reading. Here are the headlines:

- First quarterly net loss as a public company at $430mm.

- Revenue down 27%.

- Monthly transacting users down 19%.

In after hours trading COIN shares were at $61, a mighty fall from the $380 high in November 2021 when BTC was trading with a 6 handle.

Brian Armstrong, CEO of COIN, said:

“There are so many customers beating a path to our door that we have to have all hands on deck just to keep everything running…”

The sceptical amongst you will maintain he is simply talking his book.

That sentiment certainly applies to his follow-on comment:

“… so the down periods are often sometimes kind of a welcome change from that in the sense that we get to focus on building the next layer of innovation that will benefit us in the next cycle.”

No-one is falling for that one matey.

As with all crypto investments, a company focussed on retail and institutional trading of cryptos is guaranteed a volatile share price. For investors who believe in the crypto revolution, it is hard to see how part of their portfolio is not committed to COIN. Like BTC, I see this as a buying opportunity, one that might never come along again (NOT investment advice – just a comment on my very own personal opinion, an opinion which will surely come as no surprise to any regular readers).