They’re not All Saints
Trick or Treat!
Well, the total crypto market rising by more than 7% in October feels pretty treatish, but there’s some tricks lurking in the darkness. Take this tweet by Ethereum co-creator Vitalik Buterin:
And of course, this space being what it is, a memecoin was instantly born and mooned:
And with the finalization of Elon Musk’s ownership of Twitter, several memecoins leapt for joy. One of them was DOGE, which I actually — tepidly, and for chump change — blessed. It flippened Cardano to become the fifth-largest non-stablecoin crypto by market cap when it ripped 150%.
But other, stinkier sh*tcoins are also having a field day, because of course they are. Shiba Inu is up 25% over the last seven days because anything DOGE does, it eventually follows. Something called Dogelon Mars spiked 100% in just over 24 hours, probably just because its symbol name is ELON. And — fueled by nothing more than speculation (that turned out to be false) — a Donald Trump-themed sh*tcoin went so parabolic that it trended on Twitter.
So forgive me if I think there’s still danger out there. A crypto influencer ran a fake scam and lured $100,000 worth of gullible money into his sting (which he then refunded — with admonitions).
We’re not going higher on a permanent basis until all of this toxic stupidity gets flushed. And, of course, I still think the macro environment is three Band-Aids on a bullet wound.
As always: next to each coin is how much I’d allocate out of a $100 position. However, I Am Not A Financial Advisor™, and I don’t know your specific investment needs. Assume that I have owned all of these coins at some point, own most of them now, and will likely own several of them whenever you’re reading this. Not enough to matter. #DYOR
1. Bitcoin (BTC) — $35
October: ⬆️️ 5.5%
Wait, didn’t I put a $35 buy on BTC last month? Why yes, yes I did. And I’m not fixing what ain’t broken. Like I said last month:
Bitcoin is an atomic clock. It ain’t going anywhere.
On-chain analytics firm Glassnode suggests BTC is at or near its bottom using quantifiable data. And in the macroeconomic sense, it’s clear the Fed is running out of ammo to continue boosting interest rates and with it, the dollar’s strength relative to other currencies.
TradFi is continuing to buy in, with Google and BNY Mellon following BlackRock into the crypto space. Over the long term, this obviously benefits all the players, but Bitcoin is first among equals.
And if we’re wrong and we’re headed into a winter for both the broader economy and crypto? Well, we all know where HODLers huddle in the winter:
2. Ethereum (ETH) — $15
October: ⬆️ 18.4%
Ahhhhhhhh damn it.
When I put ETH at #4 on my last list, I expected it to get kicked around for the month and then I would be more bullish on it. And it did! . . . until the last week of October, when it gained 12% against BTC alone.
Technical analysis suggests ETH will still outperform the king in November, with moving averages providing a near-unanimous agreement:
But I only know a little about technical analysis and a lot about political analysis. Republicans are poised to dethrone Democrats for control of the U.S. Congress on November 8. The best time for the Biden Administration to get a bill passed with any regulations it favors will be between then and when the legislative branch officially changes hands on January 3, 2023 (since Republicans are, generally, less enamored with financial regulations). And buy “regulations it favors” I mean “regulations its donors favor.”
Also, if the Securities and Exchange Commission is going to make a move to brand ETH or other tokens as securities, their likeliest time will be right after the Nov. 8 midterms, as it can slide in during the hullabaloo of post-mortem election discussion.
3. Chainlink (LINK) — $13
October: ⬆️ 3.6%
But SmartCon 2022 kept producing potentially gamechanging news, including the long-awaited announcement of LINK staking coming in December. In a headline, Decrypt has declared that Chainlink is attempting to become the “Amazon Web Service of Web3.”
For the record, AWS generated $18.5 billion of income in 2021, according to the thing I just looked up on Wikipedia.
Also, the whales are buying:
4. Quant (QNT) — $10
October: ⬆️ 17%
One call I did make that I’m not ashamed to say I totally nailed is QNT. I closed my recommendation back in August thusly:
QNT has run an absolute ton in July, and the early returns in August are also voluptuous, so you may want to wait for this to calm down a second. If it ever does.
And it pretty much didn’t, posting a 47% return in September alone and topping out at +59% in October before finally correcting 26% from the peak. But that was still enough to send it into the CoinMarketCap Top 30.
Of course, I’m only taking a tiny victory lap because, if you listened to me precisely, you would now have . . . let’s see, carry the one . . . *pounds and cranks old-timey adding machine furiously* . . . about $4.88 on your $3 investment.
Chartists can prattle on about Elliott Waves and whatnot, but I buy into QNT’s long-term theses of scaling up businesses into web3 with interoperability.
So now that it’s pulled back, let me triple down by adding a 10-spot to your $4.88.
5. Ethereum Name Service (ENS) — $9
October: ⬆️ 5.7%
6. Maker (MKR) — $8
October: ⬆️ 21.8%
These are getting lumped together with QNT due to an article I read with the outrageously clickbaity headline “Crypto Twitter’s hunt for the next 1000x altcoin is on.” You probably think I’m being kind of a jerk and a hypocrite because, after all, I clicked on it — but remember, I was scouring for pump-and-dump sh*tcoins at the start of this article. Yeah. Now look who’s assuming things.
They have nothing to do with each other, really, except this: they all unexpectedly ripped in the month or so straddling September and October (QNT +160.5%, ENS +67.3%, MKR +97.9%).
Then, after going to plaid, they all corrected significantly to close the month (QNT -27.7%, ENS -16.66%, MKR -22.2%).
If the technical voodoo for QNT is legit, then ENS and MKR can’t be far behind, as they’ve been on more or less the same track.
But even if they don’t print new local highs during this otherwise sideways market, I’m comfortable owning them all the way to the next bull. Quant I’ve already gone into; Maker is the O.G. DeFi, and Ethereum Name Service sells the “.eth” addresses ubiquitous on Twitter.
That being said, let’s back off the insanity: they’re not going to 1000x. ENS has the smallest market cap of the trio at $300 million and change. If it multiplies a thousandfold, that would put it over $3 trillion, which would equal the current worth, roughly, of Apple AND Walmart AND MasterCard.
But I’d still rather own these than try to play all the non-ETH level-1 blockchains to pick the one that’s going to wind up being the Burger King to Ethereum’s McDonalds.
7. Algorand (ALGO) — $4
October: ⬆️ 1.5%
. . . as I was saying.
Somehow I forgot to mention the 5.75% APY Coinbase offers is the fattest on the service.
And, yeah, this seems bullish:
8. SushiSwap (SUSHI) — $3
October: ⬆️ 45%
However, recently SUSHI has begun to further differentiate itself from its parent coin. First, it’s available on more blockchains, and you know how I feel about interoperability (though you can’t yet cross-swap).
And I would say they’re cooking up even more new innovations, but . . . y’know . . . sushi. According to new “head chef” (seriously, that’s his title) Jared Grey:
Decentralized exchanges like SushiSwap are the eventual destination points for many CEX users, anyway. It’d be great for SUSHI if they cut out the middle man.
9. Injective Protocol (INJ) — $2
October: ⬆️ 43.1%
Injective is a Cosmos-native layer-2 with Ethereum compatibility, and it’s got big backers like Binance, Mark Cuban (“Shark Tank”) and Pantera. No, not that one.
INJ currently boasts a 12% APY staking yield, if you want to lock tokens up on their network. But it’s a viable play even on Coinbase as more locked tokens restrict remaining supply. Last month they landed their white whale when the “Moby Dick” namesake defi team settled on Injective after abandoning the Terra ecosystem.
10. Pluton (PLU) — $2
October: ⬆️ 4.1%
How do we get the normies into this space? is a question asked by basically every crypto protocol, except when they ask it, it’s loaded up with business jargon like “onboarding” and “retention.”
Well, an app called Plutus came up with a simple way: partner with Visa, then offer 3% back on all transactions in the form of PLU, a rewards token. In the app, users can then redeem their PLU for cool perks, stake them for further earnings, or just cash them out into fiat . . . well, euros, mostly, because the Plutus swap market is only available in the EU. You know the reason why.
No, it’s because many cool projects can’t happen in the U.S. because their developers don’t want to run afoul of the byzantine regulatory system that appears to run more or less on pure whim. Nobody wants to be the next XRP — even though it’s likely Ripple will win their suit against the SEC, it will be a pyrrhic victory, as they’re probably still going to pay some token fine so the SEC can beat their chests like they didn’t just take the L.
So, bonus pick: if you have some dry powder on non-Coinbase exchanges, consider buying XRP if it’s available. Don’t wait for it to come back to Coinbase, because you want to have it before the “Coinbase effect” kicks in.
In the grander scheme of things, every day and dollar Ripple spent fighting this stupid crap is one where they weren’t innovating — which is more of a loss to the rest of us than it really is to them, since every other crypto project has to either invest time and money figuring out how to stay on the right side of a very blurred line, or just say “screw it” and wall their best features off from the U.S.. (This is why, if you’re not on Coinbase, you’re probably on binance.us or ftx.us.) And it’s a loss for the rest of the world, as their projects lose access to millions of eager American consumers and/or developers.
Shut up, Sam. I’m (and I can’t believe I’m saying this) on Team Bitboy.
Follow me on Twitter. Get in the game. And as always,