BTC: ~$80,000 ETH: ~$2,400 6.9%–7.1% - 30-year fixed mortgage rate I have written this update more times than I'd like to admit because every time I thought I had everything, something else happened this week. The Clarity Act failed, the fed raised interest rates by 0.25% and then the SEC and CFTC released their own crypto regulations anyway pumping the markets and now bitcoin is at $80,000! Wow.... Color me speechless. Lots to cover so let's jump straight into it. _____________________________ #1 - The Clarity Act Failed but why did markets go up anyway? We followed the Clarity Act for months because I believe crypto needed clearer rules before larger financial institutions would feel comfortable fully entering the space, increasing the amount of money (liquidity) in this new sector and basically stabilizing it over time. The bill failed, which don't get me wrong is an absolute setback, but crypto regulation actually got better without it. Almost immediately, the SEC and CFTC began moving forward using the authority they already have. The SEC created a framework for certain tokenized stocks to operate on blockchain rails. The CFTC gave additional guidance around crypto software and is now working on a broader framework for crypto markets. None of that is as permanent as Congress passing an actual law, but it does something very important: it makes the industry a little easier to understand, a little safer to build in, and a little more accessible to traditional finance. And I think that is the bigger reason Bitcoin handled this week so well. ____________________________ #2 Fed Interest Rate Hike instead of remaining unchanged - shouldn't this be bad for Bitcoin? The short answer is Yes and here's where I was wrong. For months I thought the Fed would hold rates because so much of our inflation problem was tied to oil and the Iran War. Raising rates cannot create more oil or reopen the Strait of Hormuz, so I thought they would wait. The Fed raised rates and made it clear that inflation is still their priority. But what surprised me was that markets did not fall apart afterward. The economy has actually proven much more resilient than I expected too. August for example added 162,000 jobs, working hours increased, wages increased, and labor force participation improved. Consumers are still under real pressure....credit card balances remain extremely high and borrowing is expensive, but people have continued working, earning and spending instead of the economy simply breaking under the pressure.

- BTC: ~$77,000–$80,000 - ETH: ~$1,600–$1,700 - 30 year fixed mortgage: ~6.6%–6.7% We haven't done a full crypto market update in a while but it was for good reason, we simply needed to hold and wait. We laid out our stage by stage expectations of what we thought was coming so we just needed to give it time to show us if we were right or not..… Well, Bitcoin is now pushing 80k... but the question now is, will this move last? To understand what’s going now, we have to revisit what we were talking about since before July. The sequence looked a little like this: Iran war not over → oil pressure high → inflation risk from oil prices → Fed stuck can't cut, can't raise → dollar strong → Bitcoin stuck → AI booming → Labor cracks (this was the chain) Bitcoin was stuck in that boring, uncomfortable $59k to $65k range. Oil was keeping inflation messy. The Fed had no clean room to cut. Mortgage rates were still painful. Regular people were getting squeezed. And crypto was feeling the pain first because crypto usually reacts before the rest of the market admits what is happening. We were waiting for the labor market to continue to show cracks and inflation to cool so that we could see potential rate cut news. So what changed? Why is bitcoin pushing up now without rate cut news? Well, the dollar got worse but lets expand on that because it's not the only thing.. because markets as a whole saw the U.S. government blink. They saw them step in and act to prevent the free market from pushing bond yields higher. But what does it mean? It means the dollar debasement trade is back. *(Debasement trade: If people think the dollar is being weakened, they move money into things that are harder to create like gold, bitcoin, silver.)* Bitcoin caught a bid that pushed it to 80k because they can smell potential money printing again and this recent move at the very least tells the market that this government will act if needed to rescue the markets. That is bullish for asset prices like stocks, gold and bitcoin. But it's not all sunshine and rainbows. We're going to see more pain before we get there because at the end of the day... something has to break before it can be fixed. This "something" is already starting to show.. the labor force participation rate is continuing to tank down to levels not seen since 1975!!! This is the percentage of civilians who are working or actively looking for work. See the chart below. This number also doesn't account for the people that never found work, they're called "discouraged workers"... they just drop off the list and never get counted again so it could be much worse.