Good morning everybody. It’s Friday, October 2nd, 2026. My name is Matt.
And we have $86,000 Bitcoin.
Number go up.
But I’m not getting too excited yet.
If Bitcoin doesn’t start using $85K as a floor, we’re basically still in the same channel. Just because you have a pump doesn’t mean you can’t have a dump.
We do have a little macro relief this morning. Oil has slipped back below $100 a barrel. The 2-year Treasury yield is down around 4.79%, and the 10-year is around 5.25%.
Everything is moving in the right direction compared with yesterday, but that doesn’t mean we’re suddenly up-only from here.
Historically, we’re also approaching the point where Bitcoin would have hit its cycle low if this market followed some of the previous four-year patterns. It certainly doesn’t look like we’re going back to those lows.
And if we do?
Chicken Little. The sky is falling.
Spot Bitcoin ETFs were negative again yesterday, with about $92.9 million in net outflows. That’s worth watching, but after the enormous inflows we’ve had, I’m not panicking over a little profit-taking.
For me, the Bitcoin question is simple.
Can $85K become support?
If it can, we’ve changed the range.
If it can’t, then we’re still basically doing what we’ve been doing.
Stablecoins Keep Moving Into Traditional Finance
Lloyds Banking Group and Visa completed a live pilot using USDC to settle $750,000 in cross-border payment obligations.
The pilot lasted seven days, and the important part isn’t really the dollar amount. $750,000 is nothing to Visa.
It’s the infrastructure.
Lloyds purchased USDC and used it to settle payment obligations with Visa in the United States, with funds arriving in under an hour, including over the weekend.
That’s exactly what I’ve been talking about.
The customer doesn’t necessarily need to know anything about crypto.
They don’t need a wallet.
They don’t need to understand USDC.
They don’t need to understand blockchains.
Stablecoins can simply operate underneath the existing banking and card infrastructure as a faster settlement rail.
And I keep wondering why every giant financial institution isn’t eventually going to want its own stablecoin.
Maybe they won’t.
Circle and Tether already have the infrastructure, compliance systems, liquidity and integrations. Maybe it’s simply cheaper and easier for a bank or payment company to plug into something that already exists.
But if you’re JPMorgan or another massive bank, I don’t know why you wouldn’t at least look at issuing your own.
And Jamie Dimon has spent years shitting on Bitcoin, so my running joke is that he’s secretly one of the biggest Bitcoin HODLers on Earth and has just been trying to stack sats cheaply the entire time.
I’m joking.
Jamie Dimon is obviously not stupid, and JPMorgan has been building blockchain and digital-asset infrastructure for years.
The bigger point is that the financial industry has gone from arguing about whether crypto has any use to actually integrating blockchain rails into conventional finance.
That’s a pretty significant change.
Evernorth is another example of how institutional crypto is evolving.
Shareholders approved its business combination ahead of the company’s planned Nasdaq debut, with the transaction and related financing involving more than $1 billion and an enormous XRP treasury.
At closing, Evernorth is expected to hold roughly 473 million XRP, making it a publicly traded pure-play XRP treasury company.
That’s a lot of fucking XRP.
Meanwhile, Robinhood’s crypto chief is already warning that the SEC’s new five-year innovation exemption for tokenized stocks may be too restrictive.
The framework limits both the number of tokenized securities and the volume that can trade under the exemption.
Robinhood says its existing international tokenized-stock business is already large enough that it could run into those limits.
Robinhood currently offers stock tokens outside the United States across more than 120 countries, and it still wants to bring tokenized U.S. stocks and ETFs into the American market as regulators allow it.
Again, we’re watching the traditional financial system slowly move onchain.
The SEC Is Building Crypto Custody Rules as Hester Peirce Leaves
The SEC proposed a new crypto custody framework yesterday for registered investment advisers and regulated funds.
The proposal would specifically address how advisers and funds can custody crypto assets under federal securities laws.
State trust companies could qualify as crypto custodians under certain conditions.
The framework could also allow advisers to custody crypto assets themselves in limited circumstances.
That’s important because one of the basic problems institutional crypto has had for years is custody.
Who can legally hold the assets?
What qualifies as a custodian?
What happens when traditional custody rules written for stocks and bonds run into an asset where possession of a private key effectively determines control?
The SEC is finally trying to build a framework specifically around that reality.
And Hester Peirce is leaving the SEC this week.
She’s going to be missed.
Peirce has been one of the most consistent voices at the SEC pushing for clearer crypto rules.
When a lot of regulators were basically poo-pooing crypto, she was saying, “Hey, maybe don’t poo-poo this quite so much. Maybe let’s actually create some rules.”
I’m paraphrasing Hester Peirce. I don’t believe she ever officially used the phrase “poo-poo.”
She also emphasized something yesterday that I think matters: preserving the ability of individual crypto holders to self-custody.
Crypto custody for an investment adviser managing somebody else’s money is one thing.
Me holding my own Bitcoin is another.
Those shouldn’t automatically be treated as the same problem.
Europe is having similar arguments.
The Hyperliquid Policy Center wants perpetual futures treated as derivatives under MiFID II rather than trying to squeeze them into MiCA.
Circle is simultaneously pushing back against MiCA requirements that can force major stablecoin issuers to hold as much as 60% of reserves in commercial bank deposits.
Circle’s argument is actually pretty interesting.
If you’re trying to make a stablecoin safer, forcing the issuer to put enormous amounts of reserve money into commercial banks can create a different form of counterparty risk.
We already saw that problem when Silicon Valley Bank collapsed and Circle had billions of dollars sitting there.
So what exactly is safer?
That’s the regulatory problem.
Every solution introduces another trade-off somewhere else.
NEAR Intents Gets Hacked While Zero-Knowledge Technology Gets More Interesting
NEAR Intents temporarily halted services after an exploit caused approximately $3.8 million in losses.
The project says affected users will be fully compensated.
And the timing is almost comical because we just spent the last couple of days talking about NEAR Intents and its decision to intervene when funds connected to the Bitget attacker attempted to move through its system.
Now NEAR Intents itself gets exploited.
More broadly, the crypto industry lost approximately $1.26 billion to hacks during the third quarter.
So security isn’t some side issue.
We can talk about institutional adoption, tokenization, ETFs, stablecoins and everything moving onchain, but none of this works at scale if people don’t trust the infrastructure holding and moving the assets.
Then we get to something I think is genuinely fascinating.
The Ethereum Foundation and the Open Anonymity Project launched zkAPI.
The basic idea is that users and software agents can pay for AI models and other APIs without connecting those payments directly to their identities.
You deposit credits into an Ethereum-based system and then use zero-knowledge proofs to prove that you have enough money to pay for a service without revealing unnecessary information about who you are or which deposit funded the request.
This is why I’ve been talking about zero-knowledge proofs for years.
The concept is incredibly powerful.
You’re proving that something is true without revealing the underlying information.
And one application I keep thinking about is election verification.
I’m not saying, “Put every election on Ethereum tomorrow.”
That’s not what I’m saying.
I’m talking about the underlying cryptographic concept.
Could you design systems that allow someone to verify that a valid ballot was recorded and included without publicly exposing how that person voted?
Could election administrators prove certain properties about a count without exposing private ballot information?
Could multiple independent authorities participate in verification without any single authority controlling the entire system?
Those are interesting questions.
I’ve thought about models where states, counties or boards of elections operate independent pieces of a distributed verification system rather than having one centralized entity control everything.
But the architecture matters enormously.
A blockchain doesn’t magically make an election system infallible.
You still have voter authentication, ballot secrecy, physical security, software security, audits, key management, accessibility and the problem of explaining the entire thing to normal people who don’t spend their lives reading about cryptography.
And that’s probably one of the biggest obstacles.
If people don’t understand how a system works, convincing them to trust it can be difficult even if the underlying cryptography is extremely strong.
Still, zero-knowledge proofs are one of those technologies where I think we’re only beginning to understand the applications.
Privacy-preserving AI payments are one.
Financial transactions are another.
Identity is another.
Election verification could be another.
There’s a lot here.
Crypto Prices
Bitcoin is sitting around $86,456, up approximately 3.2% over 24 hours.
Ethereum is around $2,750, up roughly 1.9%.
USDT remains number three.
BNB is around $777, up approximately 1%.
XRP is approximately $1.54, up around 3.4%.
USDC remains number six.
Solana is around $122, up approximately 3.8%.
TRON is around $0.334, basically flat.
Zcash is approximately $1,390, also basically flat.
Hyperliquid is around $91.26, up approximately 2%.
We’re not seeing enormous moves across the entire market. Bitcoin itself is actually one of the stronger performers among the larger assets today.
Quant is getting crushed after its enormous recent run, down approximately 15%.
SKY is moving in the opposite direction, up around 13.7%.
Total Crypto Market Cap: approximately $2.94 trillion, up around 2.5%.
Fear & Greed: 71, Greed.
My Take
The most important number for me today isn’t $86,000.
It’s $85,000.
Can Bitcoin actually stay above it?
We’ve been talking about the $80K to $82K floor for weeks. Then we started talking about $83K to $85K. We’ve had these pumps before where everybody gets excited and then two hours later we’re right back where we started.
I want to see Bitcoin establish a higher floor.
If $85K becomes that floor, now we’re getting somewhere.
The macro environment also gave us a little relief today.
Oil is back below $100.
Treasury yields pulled back.
Bitcoin is up.
Great.
But one day doesn’t change everything.
The 10-year is still around 5.25%. That’s an enormous yield. We still have inflation concerns. We still have geopolitical risk. We still have an enormous amount of debt being issued.
So let’s see whether this holds.
The other thing I’m watching is how quickly the stablecoin and tokenization stories are becoming normal financial infrastructure stories.
Lloyds and Visa settling payments with USDC isn’t some guy buying a JPEG.
The SEC writing specific custody rules for advisers and investment funds isn’t some weird crypto experiment.
Robinhood arguing that its tokenized-stock business could already run into SEC volume limits isn’t theoretical.
This stuff is becoming part of conventional finance.
And zero-knowledge technology is moving in the same direction.
We’re getting to the point where blockchain isn’t necessarily the product.
It’s the infrastructure underneath the product.
That’s much more interesting to me than another meme coin.
For Bitcoin, though, give me a couple of days above $85K.
Then I’ll start getting more excited.
Until then, number go up.
Maybe.