1500 Answers To Why Crypto Cares About Corona

Plus Caitlin Long on starting a crypto bank

What’s up Breakers?

The last two days were spectacularly normal in a way that highlighted how spectacularly weird things have been.

For a month, we’ve watch stocks continue to soar, ignoring entirely the fact that people are being quarantined by the millions and the supply chain epicenter of the world has been effectively shut down. As the Coronavirus makes it into Europe and South Korea, and US health organizations started sending a very different message than the administration, the “nothing matters” market is being put to the test.

Jeffrey S. Stein @JStein_WaPo

NEW: President Trump is privately furious about the slide of the stock market due to coronavirus. He is expected to meet with aides tomorrow to discuss. WH is struggling to contain the economic panic over the virus' spread -- w/ @jdawsey1

washingtonpost.comWhite House struggles to contain public alarm over coronavirusTop White House economic adviser Larry Kudlow told The Washington Post late Monday that investors should consider “buying these dips” in the stock market amid the coronavirus panic. The message was to take advantage of one-day slumps and “buy low.”

Michael Batnick @michaelbatnick

This drop wasn't caused by excessive leverage, the fed, interest rates, or valuations. It was a virus. Good reminder that risk is what you never see coming.

---

On The Podcast

Monday: Caitlin Long on Coronavirus, Crypto Custody and Building a Bank

An incredible amount of work has gone into convincing institutional investors that bitcoin and crypto should be on their radar. Now that many are convinced, however, they face some significant limitations in the infrastructure. 

A new crypto bank out of Wyoming is designed to address those problems. Founded by Caitlin Long, Avanti is apply for a special purpose depository institution (SPDI) charter and already has 8 products in its pipeline not currently available to US investors. 

In this interview, Caitlin and I discuss:

• Why Avanti is needed

• Why Avanti will have 100% of assets in reserve at all times

• Why the right model for crypto custody is more akin to valeting a car than current financial market models 

• Why building a crypto bank is important in the context of macro market turmoil

• How Coronavirus is exposing pre-existing problems in the global economy

Tuesday: 6 Explanations for Crypto’s Coronavirus Focus

The spread of Coronavirus has dominated the news cycle across industries, but the discussion has been particularly fierce in both the finance and tech worlds, with crypto right in the lead. 

For a month or more, prominent crypto voices have been discussing the event in terms of skepticism of reported government cases, questions of market impact, and plans for personal preparation. 

I surveyed more than 1500 people on Crypto Twitter to ask why crypto was so interested in the Coronavirus. 

These were their top answers. 

This episode of The Breakdown also features an excerpt from Hidden Forces Ep 123: Market Nihilism: Price Discovery in a World Where Nothing Matters | Ben Hunt & Grant Williams 

---

The Best Tweets You Missed

Matt Dibb summarizing JPMorgan’s weekend-released blockchain report:

Matt Dibb @mjdibb

The team a @jpmorgan released a monster 74-page cryptocurrency report a few days ago. Too long? Here's a thread summarizing the best parts 👇e

Alex Gladstein responding to Noah Smith’s Bloomberg column on bitcoin.

Alex Gladstein @gladstein

1/ Thread on Noah's Bitcoin article. Even though it misses the mark, it was written in an engaged, interested, and curious way, something that is sorely lacking in the mainstream media. This is great and suggests he may be Bayesian and willing to change his mind.

Noah Smith 🐇 @Noahpinion

Today's @bopinion post is about cryptocurrency. The best way to make Bitcoin (or some other crypto) a widely adopted means of payment might be...a low and steady inflation target. Digital gold will probably never be money. https://t.co/pIkOspK7Ze