The Breakdown

On this edition of The Breakdown’s weekly recap, NLW discusses:

• The state of WallStreetBets
• The Bitcoin for Corporations event
• ETH all-time highs in advance of CME ETH futures
• Tether
• Cynthia Lummis on the Senate Banking Committee

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On today’s episode, NLW is joined by Travis Kling, co-founder and chief investment officer of Ikigai Asset Management. They discuss:

• GameStop, WallStreetBets and financial populism
• Whether regulatory hearings will actually address any issues around retail investors 
• How WallStreetBets relates to bitcoin
• The rise of institutional investors 
• The end of career risk around bitcoin for investment professionals
• Why recent bitcoin FUD has been disingenuous
• How investors can price risk in bitcoin 
• Where DeFi fits for institutional investors

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Today on the Brief:

• Elon Musk back to DOGE trolling
• Bank of England says to prepare for negative interest rates
• Janet Yellen on “Good Morning America” discussing retail investors

Our main discussion: What did we learn about PayPal’s crypto strategy from its quarterly earnings report? 

In this episode, NLW breaks down:

• How PayPal’s perspective on crypto evolved
• What we learned about the success of its offering in Q4 2020
• What’s next for crypto at PayPal in 2021
• Why its biggest play is squarely focused on central bank digital currencies

  -- Earn up to 12% APY on Bitcoin, Ethereum, USD, EUR, GBP, Stablecoins & more. Get started at nexo.io -- Enjoying this content?   SUBSCRIBE to the Podcast Apple:  https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M=   Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW   The Breakdown is produced and distributed by CoinDesk.com

Today on the Brief:

• An update on Ant and Jack Ma
• Bezos stepping down as CEO of Amazon 
• Miami’s play to become a crypto hub

Our main discussion: MicroStrategy’s “Bitcoin for Corporations” event 

Michael Saylor and MicroStrategy opened a new category of bitcoin investment last year when the company moved hundreds of millions of dollars of cash reserves into bitcoin. 

For the next two days, the company is hosting a virtual conference designed to help the 1,400 corporate leader attendees discover the playbook that allowed them to make the dramatic move that has paid off so well. 

In this episode, NLW examines the current state of institutional investment in crypto and asks what this event says about what might be coming next. 

  -- Earn up to 12% APY on Bitcoin, Ethereum, USD, EUR, GBP, Stablecoins & more. Get started at nexo.io -- Enjoying this content?   SUBSCRIBE to the Podcast Apple:  https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M=   Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW   The Breakdown is produced and distributed by CoinDesk.com

WallStreetBets is having a rough day. Its stocks are crashing. Champions from as recently as last week are selling out. More brokerage apps are turning off buying. 

In this episode, NLW explores what it means for this set of assets and the larger shift in power from institutional to retail investors. 

He argues, ultimately, that over the last year retail traders of the type led by WSB have established themselves as too powerful a force for the market to simply turn away from now.

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Today on the Brief:

• Elon Musk talks bitcoin on Clubhouse
• India trying to ban crypto?
• DEXs have best month ever in January 

Our main discussion: Has WallStreetBets been infiltrated by hedge funds? 

Reddit community WallStreetBets became headline news last week when its short squeeze of GameStop (GME) nearly brought a famed hedge fund to its knees. According to Twitter personalities and the mainstream media, the community has now turned its focus to squeezing silver. 

Except, one cursory look at the subreddit shows that isn’t the case. Instead, it is full of posts about how hedge funds and media are trying to promote the silver story to distract and divide the community. 

In this episode, NLW tries to break down what’s happening and argues that now that WSB has become a market force, these sort of attempts to influence its conversation are going to become de rigeur. 

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Today’s “Long Reads Sunday” is a reading of Ray Dalio’s recent LinkedIn post, “What I Really Think of Bitcoin.” In his interpretation, NLW argues the post shows Dalio and Bridgewater are at the beginning of a deep dive into the space. 

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In this edition of the Breakdown’s weekly recap, NLW looks at:

• Robinhood’s ham-fisted explanations for why it shut down buying for GME and other stocks
• Why the root cause seems to have been insolvency
• How politicians are gearing up for political inquiries around the trading shutdowns 
• How WSB is reacting to the shutdown attempts

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Last night, Tesla and SpaceX founder Elon Musk changed his Twitter profile to a single word: “bitcoin.” He also tweeted a cryptic message: “In Retrospect, It Was Inevitable.”

The price of bitcoin surged in the wake of the tweet, as did Google searches for “bitcoin.” The price increases liquidated some $387 million in short positions. 

In this episode, NLW breaks down the market reaction to Musk, the significance of the tweet and why it all connects to the larger story of WallStreetBets, Robinhood and shifting financial power.

-- Earn up to 12% APY on Bitcoin, Ethereum, USD, EUR, GBP, Stablecoins & more. Get started at nexo.io -- Enjoying this content?   SUBSCRIBE to the Podcast Apple:  https://podcasts.apple.com/podcast/id1438693620?at=1000lSDb Spotify: https://open.spotify.com/show/538vuul1PuorUDwgkC8JWF?si=ddSvD-HST2e_E7wgxcjtfQ Google: https://podcasts.google.com/feed/aHR0cHM6Ly9ubHdjcnlwdG8ubGlic3luLmNvbS9yc3M=   Follow on Twitter: NLW: https://twitter.com/nlw Breakdown: https://twitter.com/BreakdownNLW   The Breakdown is produced and distributed by CoinDesk.com

This week, a collective of foul-mouthed internet memers took down some of Wall Street’s best-known hedge funds. In today’s episode, NLW looks at:

• The historical context of how the Great Financial Crisis set the stage for WallStreetBets
• How WSB gained infamy during the COVID-19 crisis by correctly predicting the market’s rebound while other investors remained bearish 
• Why WSB started going after short-sellers, particularly around GameStop (GME)
• How WSB forced a short squeeze that required Melvin Capital to call in nearly $3B of emergency capital 
• Why Robinhood forcing users to stop buying GameStop and other related assets will go down as an inflection point in the history of capital markets

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The Breakdown is produced and distributed by CoinDesk.com