JPMorgan to Launch Basket Product of Companies with Exposure to Bitcoin | MicroStrategy Buys Another $15M Worth of BTC
Top stories and news you should know in the bitcoin, crypto, and decentralized markets...
JPMorgan is launching a structured investment product based on the performance of its “cryptocurrency exposure basket” tracking stocks that are publicly-traded companies with exposure to bitcoin
Weightings of each stock will be determined based on their exposure to bitcoin, its correlation as well as liquidity to bitcoin
Drilling Down Deeper
Years of Jamie Dimon calling it an “economic side show” and “fraud,” the JPMorgan CEO this week said, “We will have to be involved [with bitcoin].”
This week marks a major turning point for that chief executive officer and his Wall Street institution with almost three trillion dollars under its management to launch a new product that gives their clients and investors exposure to bitcoin, albeit through eleven publicly-traded proxy stocks. JPMorgan just a couple weeks ago said, “In a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall-risk adjusted returns of the portfolio.” Still, they went on to opine that when looking for a macro hedge that the yen or U.S. dollar is preferred as a funding currency rather than cryptocurrencies that are investment vehicles.
According to a filing with the SEC, the bank’s product will be a debt instrument titled “JPMorgan’s Cryptocurrency Exposure Basket (Mar 2021)” containing an “unequal weighted” basket of companies’ stock that have bitcoin on their balance sheet or operate businesses linked to crypto. Showing that they have come along way since completely writing off bitcoin and crypto assets altogether, their analysts have predicted that bitcoin could reach as high as $146,000. Once thinking that it will be closed down by the government, Dimon compared it to tulip mania although the market for bitcoin has outlasted all the extraordinary bubbles that he and his cronies loved comparing it to making them all look quite foolish in hindsight.
The four main reference stocks that make up about 68% of the basket corresponding to the prospectus they provided showed allocations to MicroStrategy (20%), Square (18%), Riot Blockchain (15%), and NVIDIA (15%). The remaining portfolio is spread across Advanced Micro Devices, PayPal Holdings Inc., and Silvergate Capital Corp. Oddly enough, the brilliant investment bankers left Tesla, Inc. out of their baskets despite the company holding over $1.5B worth of Bitcoin!
It was only a matter of time that more institutions and leaders reverse their stances on bitcoin, especially JPMorgan as they have been lagging behind Charles Schwab, Fidelity, Vanguard, and recently Goldman Sachs who all made announcements last year and earlier this year to start offering buying, selling, custody, and trading services in BTC for their clients. Having been left in the dust and by not allowing their clients and customers have access to bitcoin and crypto assets, these banks and financial institutions were not fulfilling their fiduciary duties. Finally feeling the heat from clients as well as employees internally, Wall Street banks are beginning to adopt bitcoin after Ivy League endowments and publicly-traded companies beat them to the punch.
The five-count felony firm of JPMorgan Chase, all five of those felony counts in a six-year span, with Jamie Dimon presiding over the bank as CEO throughout it all as well as even after the financial institution admitted guilt to all five felonies also has been busy doling out speaking fees to celebrities, politicians, and would-be regulators over the years when they could have been investing it in bitcoin.
TL;DR Corrupt banks are being forced into bitcoin and crypto assets that are more accessible, cheaper, and transparent alternatives, or else they risk going extinct.
“First they ignore you. Then they ridicule you. And then they attack you and want to burn you. And then they build monuments to you.”
— Nicholas Klein
News You Should Know
Cathie Wood Sees Bitcoin Joining Stocks and Bonds as Part of the Classic Balanced Portfolio
As companies adopt bitcoin and other cryptocurrencies by supporting payments, transfers, or actually buying the assets, it is solidifying bitcoin as a core part of an investor’s optimized portfolio. Cathie Wood citing that there is a 40-year bull market in bonds, she continued saying “We would not be surprised to see this new asset class become part of those percentages. Maybe 60 equity, 20, 20…”
Norwegian Investment Firm Allocates $58M to Bitcoin and Crypto Ventures
Aker, the 180-year old conglomerate that controls oil and oil service companies in Norway, announced in a shareholder letter they had established SeeTee as a new company investing in the “bitcoin ecosystem.” Their new investment unit made its first purchase with 1,170 BTC saying their strategy is to “hodl” and plans that the subsidiary will hold 100% of its company’s treasury reserves in bitcoin…
Weeks After $1B Bitcoin Purchase, MicroStrategy Buys Another $15M Worth Of Cryptocurrency
The business analytics company’s CEO took to Twitter yet again to announce another purchase of additional bitcoins. This time around MicroStrategy added another 262 BTC, using $15M in cash, to increase its bitcoin stack and further extend its lead as the publicly-traded company with the most bitcoin on its balance sheet…
Last Close = $57,800 (as of Mar. 11, 2021)
Market Capitalization = $1.1B
YTD Performance = +99%
Last Close = $1,825 (as of Mar. 11, 2021)
Market Capitalization = $210B
YTD Performance = +149%
Total Crypto Asset Market Capitalization = $1.73T
Bitcoin Dominance = 62% (over 8,700 cryptocurrencies)
Bitcoin at the time of this writing has a long/short ratio of 49%/51% suggesting that there may be a sideways to downward action in the near-term, but given the news and moves being made in BTC that could be short-lived as the bulls try to take it back to new all-time-highs. Ethereum is benefitting from the new ICO-like frenzy and froth in the non-fungible-token (NFT) market. Yesterday, a Wisconsin-based artist known popularly as “Beeple” sold an all-digital artwork for over $69 million via Christies auction house. It is inspiring many creatives, digital artists, and graphic designers to create their own and learn more about the exciting and high-flying NFT market as more traditional artists are entering the arena and looking at them as efficient ways to issue, license, and profit from their works of art. Despite all the noise around bitcoin, the amount of BTC held on exchanges reached another 2-year low without much notice. It bodes well as a sign that more “hodlers” are in for the “long game” and their conviction is strong enough to withstand any market correction, maybe enough even to keep buying more like Michael Saylor. Take note of who is buying the dips!
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