Good morning everybody.
Bitcoin is still moving sideways around the $64,000 range, and the market continues trying to decide whether this is a temporary pause, a shallow bear market, or the beginning of a much deeper decline.
I recently watched a video from Crypto Currently laying out the case for a shallow bear market. Their argument is that global liquidity is already beginning to rise, but Bitcoin typically reacts with a delay of roughly 75 days. Under that scenario, Bitcoin could get a temporary pop before falling back toward the mid-$50,000 or low-$50,000 range rather than following the usual bear-market path into the $40,000s or $30,000s.
I do not have proof that will happen.
The four-year Bitcoin cycle has remained remarkably consistent for roughly sixteen years. Until the market clearly breaks that pattern, I still think we should consider the possibility that Bitcoin eventually falls toward $40,000 or even $35,000 later this year.
But the bigger question is not where Bitcoin bottoms.
The bigger question is what you will do when the market gives you a reason to believe Bitcoin is actually broken.
The Next Black Swan Will Feel Different
Every major Bitcoin decline comes with a story explaining why this time is different.
China bans Bitcoin.
Mining activity collapses.
Governments regulate the industry.
An exchange blows up.
The economy shuts down.
Each time, the market produces headlines suggesting the experiment is over.
Looking back, those periods were usually the best times to buy.
During the COVID crash, Bitcoin briefly fell below $5,000. If that happened today, most long-term Bitcoin investors would probably want to buy as much as they could.
That is easy to say in hindsight.
It is much harder to act while the panic is happening.
The next major scare may involve quantum computing or artificial intelligence. The headlines could say Bitcoin’s cryptography has been broken, private keys are vulnerable, transactions can be reversed, or the immutable ledger is no longer immutable.
That would not create a normal correction.
That could create a complete collapse in confidence.
Bitcoin could fall into four-digit territory. It could drop below $10,000. It could briefly trade around $3,000.
Would you buy then?
Would You Buy Bitcoin at $3,000?
Imagine Bitcoin falls to $3,000 after a serious security failure.
You could buy ten Bitcoin for $30,000.
If developers patched the vulnerability and Bitcoin recovered to $60,000, those ten Bitcoin would be worth $600,000.
That would be an extraordinary return.
But you would have to make the purchase while everyone was telling you Bitcoin was dead.
You might buy at $3,000 and then watch it fall another 60% or 70%. Your $30,000 investment could temporarily look like $10,000.
Would you still hold?
Would you believe the problem could be fixed?
Would you have the stomach to risk real money while the market was pricing in Bitcoin’s permanent failure?
That is the real test.
Everybody wants to buy the bottom after the recovery has already started. Very few people want to buy while the bottom still looks like the end of the market.
This is not financial advice. It is simply the question I have been thinking about.
Strategy Reports an $8.2 Billion Quarterly Loss
Strategy reported an approximately $8.2 billion second-quarter net loss, driven almost entirely by an $8.32 billion unrealized markdown on its Bitcoin holdings under fair-value accounting.
As of July 26, the company held approximately 843,775 Bitcoin.
At current prices, that Bitcoin was worth roughly $54.8 billion, compared with an acquisition cost of approximately $63.7 billion.
The company also expanded its U.S. dollar reserve to $3.75 billion, enough to cover more than two years of preferred dividends and interest payments. It raised approximately $17.06 billion through stock offerings during the year and repurchased around $1.5 billion in convertible notes at an 8% discount.
I still do not understand how this structure continues operating the way it does.
Strategy raises capital, buys Bitcoin, issues more securities, services its obligations, and then repeats the process.
It increasingly resembles a traditional financial pyramid built around one volatile asset.
Somebody needs to explain clearly why this is not effectively a Ponzi-style structure, because from the outside, that is what it looks like.
Coinbase Misses Expectations
Coinbase shares fell approximately 5% after the company reported $1.22 billion in second-quarter revenue, below expectations of approximately $1.29 billion.
Transaction revenue came in at $599 million, compared with expectations of $628 million.
Subscription and services revenue reached $555 million, below the expected $599 million.
Coinbase added approximately 819 Bitcoin during the quarter, bringing its total balance to around 17,211 Bitcoin.
The company said it reached a record 10.3% share of global crypto trading volume, but the quarter remained difficult because Bitcoin fell approximately 14% and Ethereum declined roughly 25%, reducing trading activity and volatility.
This is the period when I start paying attention to crypto-adjacent companies again.
When Bitcoin falls, stocks such as Coinbase and Robinhood often fall much harder. When Bitcoin recovers, those same stocks can move aggressively in the opposite direction.
That does not make them true diversification. Coinbase still depends heavily on crypto activity, and its stock will continue moving with Bitcoin to a significant degree.
At some point, the simpler question becomes: why not just buy Bitcoin?
Still, for investors who believe the cycle will eventually recover, these companies can offer amplified exposure to the broader crypto market.
Again, that is not financial advice.
I am just a guy sitting in a poorly painted office with a Star Trek Enterprise lamp on his desk.
Global Banks Test Tokenized Cross-Border Payments
A Bank for International Settlements pilot called Project Agorá processed approximately $1 million in real-value cross-border transactions across 30 transfers.
The experiment used tokenized central-bank reserves and commercial-bank deposits.
Five central banks and 28 commercial lenders participated, including JPMorgan, Citi, UBS, Deutsche Bank, and Standard Chartered.
The pilot covered six currencies:
U.S. dollar
Euro
British pound
Japanese yen
Swiss franc
Chinese yuan
Payments settled in approximately 80 seconds on average, even though the prototype was not fully integrated with existing bank payment infrastructure.
Long story short: bueno.
This is one of the clearest examples of blockchain-based settlement moving beyond theory and into practical financial infrastructure.
Banks are not ignoring tokenization.
They are building their own version of it.
The CLARITY Act Is Losing Momentum
JPMorgan said declining odds of the CLARITY Act passing this year represent a setback for crypto markets and institutional adoption.
Prediction markets now place the likelihood of passage before year-end at only around 37%.
The bank warned that continued delays could allow tokenized assets and blockchain-based applications to be absorbed into incumbent financial infrastructure rather than developing through public crypto networks.
That distinction is the entire fight.
Will tokenized finance operate through open public blockchains, or will it be absorbed by the same financial institutions that already control the traditional system?
Banks have strong incentives to delay or reshape the legislation.
They do not like stablecoin yield.
They do not like reward structures.
They do not like systems that allow retail customers to earn returns that would traditionally remain inside banks.
If the CLARITY Act does not pass before the end of the year, I expect a major restructuring designed to protect incumbent financial institutions, established companies, and banks.
Retail investors will likely be the ones who lose access to yield.
Crypto Prices
Bitcoin: $63,427, down 2.2%
Ethereum: $1,876, down 2.5%
Tether: Third-largest cryptocurrency
BNB: $591, up approximately 1%
USDC: Fifth-largest cryptocurrency
XRP: $1.06, down approximately 1%
Solana: $73.37, down 1.1%
TRON: $0.326, down 0.5%
Hyperliquid: $54.96, up 3.3%
Dogecoin: $0.069, down 0.6%
Total Market Cap: $2.18 trillion
Fear & Greed Index: 35, Fear
My Take
The Bitcoin price is not the most important question right now.
The real question is whether you believe in Bitcoin strongly enough to act when the market gives you a convincing reason not to.
It is easy to say you would buy Bitcoin at $20,000 when Bitcoin is trading above $60,000.
It is much harder to buy after a genuine security failure, a quantum scare, a global crisis, or a headline claiming Bitcoin’s core technology has been broken.
That is when the opportunity could be greatest.
It is also when the risk would be most real.
At the same time, Strategy continues building a financial structure around enormous Bitcoin holdings, Coinbase is being punished for weaker trading conditions, global banks are testing tokenized payments, and incumbent institutions appear increasingly positioned to absorb blockchain infrastructure into the traditional financial system.
The market may be quiet.
The fight over who controls the next version of finance is not.
Happy Hodling, Everyone.