New York morning trade.
We are seeing Bitcoin back above the 63,000 level.
Last week we saw the major sliding to its lowest level since 2024 and also falling below its 200 week moving average.
Well joining us as we kick off in the trading week is Sam Callahan, Director of Bitcoin Strategy & Research at OranjeBTC.
Good morning.
Sam, great to have you here.
So we are keeping a close eye on Bitcoin prices, but what do you make of the bounce that we're seeing this morning and ahead of that SpaceX IPO on Friday, we've been hearing about rotation away from crypto.
So tell us what you make of the price action this morning.
Yeah, I think a bounce was expected.
I mean, obviously we saw some heavy sale pressure last week and into the weekend.
So a relief bounce was, I think, necessary for the asset.
And so it's not really surprising to me to see it bounce today.
Um, I think there is a, a capital rotation that occurred, um, with these AI companies, a lot of outperformance from these stocks, as well as anticipated IPOs that have investors excited about it.
You know, capital is scarce, and so, We saw recently over the last couple of years, the investor base of Bitcoin change, you know, 20% of coins are now held with institutional investors, and they rebalance.
They answer to clients on quarterly performance, and so you expect to see some of these rotations occur.
I think you saw over $4 billion lead the ETFs, and we know these institutions prefer to gain exposure to Bitcoin through ETFs.
And so I think that's a sign that we did see capital rotation.
And I think on top of that, we still have a lot of uncertainty on the geopolitical front, how it's going to impact oil prices, how that impacts inflation, which impacts monetary policy.
You see yields rising on the long end in sovereign markets across the world, which puts pressure on risk assets, including Bitcoin.
And so it's, it's really a confluence of factors where we see Bitcoin selling off, but pretty par for the course in terms of Bitcoin short-term volatility.
The fundamentals remain strong for why you'd want to hold it.
Yeah, and of course I do have to get your take on some of the recent headlines out there regarding sailors selling Bitcoin, but also in terms of a price prediction out from Tom Lee regarding ET out there.
So when it comes to the Treasury trade, in addition to everything we're seeing on the macro front, how are you separating signal from all the noise out there?
Well, I think, to put it simply, you're seeing some treasury companies have to sell from a period of stress, and others are selling some Bitcoin for strategic reasons, and many are still buying.
And so you're seeing really a separation for management teams that execute with discipline versus those that potentially took on two leverage at the wrong time of the cycle that are now selling from a period of a position of weakness.
But when it comes to strategy, I think people vastly underestimate the resilience of its capital structure, the strength and size of its Bitcoin balance sheet, as well as the optionality of its treasury operations.
You know, we saw this morning, they raised $100 million in cash to add to their USD reserves, as well as purchased another about $100 million worth of Bitcoin during these challenging market conditions, and they did that through issuing MSTR, which was trading at a premium.
Um, and so you, you see people really underestimate their ability to raise capital, as well as to service the dividend.
Um, as well as just the amount of Bitcoin they have, you know, this isn't 2022 anymore.
They have 845,000 Bitcoin.
They acquired almost 90,000 Bitcoin in Q1 alone.
And so people were really freaking out about a 32 Bitcoin sale, but they communicated to the market that they were willing to do that to increase Bitcoin per share for their shareholders, for uh tax benefits.
And so I think it was an overreaction from the.
Market on the sell and and really you have to look at their, their net buying.
I mean, even if they sold Bitcoin to service the entire monthly dividend obligation, we're looking at about 1500 Bitcoin they would need to sell at current prices again, they bought almost 90,000.
We are fast approaching the end of the show right now, so we will have to leave it there.
Hopefully we can have you live here at the New York Stock Exchange.
Thank you so much for joining us.
