Wall Street retreat threatens crypto proxy stocks
The guest argued that Wall Street's launch of Bitcoin ETFs has effectively killed the asset's narrative, leading to a rapid retreat that puts proxy stocks at risk.
The argument
The guest noted that major financial firms like BlackRock have turned into sellers and stopped promoting crypto, leaving highly leveraged crypto-holding companies vulnerable.
The thesis, stress-tested
✓ What validates it
- ✓Continued selling of Bitcoin ETFs by major institutions like BlackRock
- ✓Further downward pressure on MicroStrategy's stock price relative to its Bitcoin holdings
▸ Risks discussed
- ▸A sudden resurgence in retail Bitcoin demand could squeeze short positions in proxy stocks
Hear it yourself
"Those loans specifically will be underwater because the house will be worth less than the loan. This is something we haven't had to talk about since 2008. Right? It's been a long time. For a long time, houses were way undervalued and people slowly came back in. But it took seven years. It was really 2015, 2016 when the market cleared. But since then, prices have gone straight up. So when people get into trouble today, the servicer will contact the borrower and say, look, I know you're having problems. You're three months behind on your loan. Let's sell the house, pay off the loan, and I'm gonna give you the residue."
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