# Crypto Bottoming Signals and Institutional Adoption Shifts

**Podcast:** The Milk Road Show
**Published:** 2026-02-10

## Transcript

If you're taking emotion out of it and you ignore what the price action has done as a short term, if you liked Ethereum based on what you believed Ethereum could be, or like Telana based on what you believed it could be three years ago, this case for those is 10 times stronger now, right?
And the price might be the same.
So it's the same for Bitcoin, right?
I mean, look at all the incredible tailwinds for Bitcoin and ETFs and maybe strategic reserves.
Well, you love those narratives at 125.
You should be buying the hell out of it at 60 if you still believe in the same narrative.
So listen, price and value are not the same thing, right?
And people get very tied up in the price, but your fundamental belief in your research tells you what the value of an asset is.
And if the price is below your perceived value, you should be buying it.
And I think that Bitcoin, Ethereum, and Solana are all undervalued right now.
Bitcoin is finally showing signs of life, but has failed to recover from the sharp selling of last week.
Is it going to build a base here and move higher?
Or are we about to settle into a long bear market?
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And today we are joined by longtime friend of the show, Scott Melker.
Scott is better known as the Wolf of All Streets and is a prominent cryptocurrency trader, investor, and analyst who hosts the Wolf of All Streets podcast and authors the Wolf Den newsletter.
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Scott Melker, how are you, sir?
Thanks, John.
I'm doing great.
I'm excited for this conversation.
I think there's a lot of people who are worried about Bitcoin right now.
Scott, have we bottomed on Bitcoin or are we going lower?
Is your crystal ball better than mine?
I don't know.
Uh it could be a bottom.
It feels like a bottom.
There are a lot of reasons to believe that it could be a bottom, but I also see the bear case for lower.
And it's very, very difficult to nail a bottom on any asset when uh it's trending clearly in one direction.
So for the technical analysts out there, I think there's been a lot of eyes on the weekly chart because historically, if we break the 50 moving average on the weekly chart, which we have done this time, uh, you tend to get a trip to the 200 MA.
It's happened every single time in the past, but I'd like to remind people that three or four times is not statistically relevant.
So uh I don't know that it's particularly meaningful, but uh we also usually get a retest of the 50 MA as resistance, which we slightly missed this time.
It's about 101.
Bitcoin went up to about 98.
Well, that line's about 57 right now, and we got down to the 59.
So maybe that's close enough as well.
And that line has been front run.
But uh that would be a target of about 57.
Uh, the monthly 50 MA is right in the same area, about 55, 56.
So I think that there's strong support below if we do go down again.
But we all know that in markets, if everybody's watching a line, either that line does not exist on the way down or it gets front run by smart money.
Who knows everybody is waiting for that line?
So I'm more inclined uh to believe the latter that we are bottoming and basing here.
From a fun, I mean, from the same technical perspective on the weekly chart, we have oversold RSI, which means that RSI is below 30.
That's about as old school of an indicator as you can get, just showing that the asset is oversold.
That's only happened a few times in history.
Every one of those times has been at the beginning of the basing.
So you expect 150 to 250 days of boring chop, but with the lows basically in or close, and then the ascent to the to the upside.
So I think if you were making a case based on history, you would say that we have bottomed or are bottoming, but that process could take a lot longer than people would like.
And we start to go up, you know, in six months, seven months.
I have no idea what will happen.
I think that sentiment is in the dumpster.
That's usually a pretty good sign that things are on their way up.
We had, I think the crypto feared read index at five, which is historically low, lower than the levels of all of the previous bottoms that we've had before.
So, you know, if you like to take a look at sentiment and charts, we're either at a bottom or close.
Scott, this is one of the reasons I loved interviewing you.
You covered all the things I wanted to bring up and touch in that one answer.
So great, great answer there.
Uh, but yeah, I agree.
I was watching a lot of these moving averages as well, and we got close, but we didn't touch them.
And now I'm like, well, does that count?
Are we going to go back?
So we'll see.
But yeah, I agree with, yeah, it counts, right?
Like it feels like a bottom, it looks like a bottom, call it a bottom.
Uh, are you accumulating here?
I think is a question a lot of people are wondering.
Are you waiting for it to go low?
Are you just getting in heavy here?
What's your what's your strategy around this?
So the majority of my strategy is blindly buy Bitcoin using an algorithm that I have on dips and not think about it.
I view Bitcoin personally as a savings account.
So I don't really even view it as buying Bitcoin.
I just view it as the same way people have classically looked at savings, which is take a percentage of what you've earned that you don't need that you can put into savings that you're not going to touch for a while.
I'd rather put that into Bitcoin than a low-yielding savings account in dollars right now.
So I'm always buying Bitcoin, but I did add tremendously manually uh around 60,000, 61, 62,000.
That was an area I was very keen to buy.
I've had bids sitting there for a long time just in case.
And once again, I also have some around 57 and 58, but I anticipated that maybe those lines would get front run.
And so the bulk of my buying was done.
I mean, from a dollar value, I've bought more Bitcoin now than almost any time in the past.
Uh so I uh, but I don't care if it's the bottom.
Like if it goes to 30, I would be super excited to buy more at 30 or 50 or 40.
So the, you know, I I'm actually one of those euphoric bulls who likes when price goes down because if I'm really trying to add to my savings account, would I rather be buying 60 or 150?
Obviously, 60.
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Right.
Yeah.
And I think that this is kind of a weird place you get mentally where you get excited when it drops.
And I don't know, my stomach would drop a lot if it went to the 30s, but I would also be accumulating aggressively.
Um, Scott, I want to get your thoughts on this.
There's been this huge divergence in crypto.
You know, you touched on a little bit in your prior answer, but the fundamentals, the adoption, the institutional investment keeps getting stronger, keeps getting bigger and building, but the sentiment has never been worse.
And and uh this this divergence seems to continue to widen.
What do you think needs to happen to bring back some of the investor attention and to revive some of the sentiment that we've seen?
What are you looking for as a catalyst to sort of shift the narrative here?
Higher prices.
I know it sounds like a joke, but there's no better art advertising for Bitcoin or any other asset than higher prices.
The minute it starts to go up, well, uh put it this way if you see a $10,000 candle to the upside or a $15,000 week or a $20,000 week, which we know is totally in the cards, totally possible.
All of a sudden, all of these bullish headlines that we've seen will matter.
And people will start talking about all the incredible things that are happening and the institutional adoption and the regulatory uh tailwinds and all these things that we get on a daily basis as news stories that don't move the price.
And then you'll get FOMO kicking in and then retail that said they would buy at 75, but then wanted to buy lower, but then wanted to buy lower and never bought.
They'll buy at 125 on the way up, and then they'll put it in the top at 150 and we'll come right back down to a sensible level.
But yeah, I don't think it's gonna be the Clarity Act.
I don't think it's gonna be an announcement at this point from the government.
We've seen every single institution basically announce some sort of plan for Bitcoin.
Those would have been the kind of headlines that would have absolutely sent the market flying three or four years ago.
Now we don't even read them, right?
They're just another part of the story.
So I think that uh there will be an inevitable time when there's just seller exhaustion and buying kicks in and we start to get up to a certain level where FOMO once again returns and everybody will start buying.
Tell as old as time.
Yeah.
So I want to ask a question about this.
You've described sort of two different scenarios here, right?
One is this idea, this thesis that we're gonna have six, seven months left on this bear market before we see some real action to the upside.
And then there's this other thesis that a lot of people have put forward that this is still just a mid-cycle correction.
We're going to get this recovery, we're going to see new all-time highs here somewhere in 2026.
Which camp are you in on that?
And do you think it like, yeah, what are your thoughts around those?
That the competing thesis there.
You know that meme with the little Asian girl, why not both?
That's kind of how I feel, right?
So why not just consolidate for six months and then you know, at the tail end of the year, we're making new all-time highs and everybody can be right and happy and smile together.
So I don't necessarily see them as a competing thesis.
But the reality is we've gotten retraces this large that people would look back on and view as bull markets.
Right.
So it's it's all a matter of definition and time frame.
So, like if the price of an asset drops 55%, most people would say that's a bear bear market, right?
I think we went down 52%, 53% here.
By the way, silver uh went down 48% in six days.
So I don't hear anyone screaming about the silver bull market, uh, bear market, excuse me.
Um, but either way, when you take a look at 2021, which was when you look back, people view as one of the most bullish years ever for crypto, not only because Bitcoin moved, but obviously that was when we had a massive alt season, which we haven't had this time.
But you basically had this massive market boom from January to call it April or May.
Then Bitcoin topped and in a matter of weeks went from 65,000 to 28, 55% retrace, consolidated down there and then skyrocketed back up to 69.
All coins went crazy, and people look back at 2021 as the magic fourth year of that cycle when everybody made money.
But there was a 55% multi-month retrace in the middle of that.
In the moment, with recency bias, people don't view things the same way, right?
So, yeah, there are other technical parts of it that may or may not have happened, but we've been here before.
So it's a matter of, I guess, your uh half class empty, half class full perspective on the exact same event.
Yeah, I think that would be really interesting and a very hilarious outcome if both theses turned out to be correct this year.
Um, we talked about your position on Bitcoin.
You're stacking heavily.
Is there anything else in crypto that you're stacking right now?
I'm buying Solana and Ethereum now, just not nearly as much as I'm buying Bitcoin.
Okay.
Explain the thesis on that.
Why Solana and Ethereum only and why so much less than Bitcoin?
Okay.
Well, I view Bitcoin once I said as a savings account.
Ethereum and Solana I view as slightly more speculative.
I would like to believe that I can hold them for 50 years, but I'm not sold yet, right?
Um, but I still think that we're entering a world now of have and have nots in the crypto market.
And the haves are going to be those that have direct pipeline to institutional adoption, have ETFs so that people can buy them in their stock portfolios.
The have nots are going to be anything that's left without an institutional product, and you have to rely on crypto retail to send the price up, right?
And so I think that those are just the big three that you would want to have in your portfolio at this point.
I'm not trying to overthink it.
So, you know, if I'm 15% ETH, 15% Solana, and you know, the remainder is Bitcoin.
That's kind of uh, you know, generally depending on how they move, that's that's where I'm at.
Gotcha.
Yeah, I think that's a pretty common thesis at this point.
But I do think, you know, not to weigh too deep into the weeds here.
There have been a lot of other altcoin projects that have held up much better than I expected, I think, during this dip.
I think hyperliquid is one that got a lot of attention, benefited from some of the liquidations, maybe.
But um, there's still some strength in the alts there.
So I'm glad to hear you're you're still still taking some nibbles there.
I want to ask you about something happening in Ethereum.
Uh recently, Vitalik caught a lot of flack for this post he made about pivoting away from this L2 centric roadmap for Ethereum in favor of specializing the L2s and scaling the L1, which seems to be the direction of travel.
And he just sort of finally acknowledged this.
Um, what are your thoughts on this?
Is this bullish or bearish?
Is this a nothing burger?
What are your thoughts on this for Ethereum here?
I can't really define whether it's bullish or bearish.
It depends on for what.
It's bullish for ETH, who really bearish for L2s, and probably a nothing burger for the market because that's not the things that people necessarily trade on, right?
They just trade on momentum and price moving and speculation.
So I think it's interesting that he is at a point where he believes that the L1 can scale to the point of mainstream adoption when obviously L2s were a fundamental part of that question or solution in the past.
I think that there's a place for L2s, but he's probably right in how he defines them.
Why not have a gaming L2 or an NFT L2 or a DeFi L2 or a Metaverse L2?
I don't know.
I'm just throwing out things that I heard four or five years ago.
Um, and each one kind of finds a specialty.
I think that's how you can maybe look at ETH versus other L1 blockchains as well, by the way.
I don't think that every blockchain needs to do everything.
So specialized is not necessarily bad.
Uh, I just do find it interesting how somewhat all over the place the uh Ethereum narratives are, right?
Uh, but if you use Ethereum now, I believe transaction volume is exceptionally high, maybe near all-time highs, and it's it's you know, 20, 30 cents instead of 200 or 300 at the same amount of usage in the NFT and DeFi boom.
So they've obviously made massive improvements to the L1 and its scale, and maybe they can uh make it the everything chain.
Yeah, I remember the days when Uniswap was just unusably expensive because of the gas fees alone.
Um, and we've come a long way since then.
And you know, I think it's an interesting thing.
At the time, the L2 centric roadmap seemed like it might have made sense.
Maybe it was the right move then, but now that that circumstance has changed and it seems like they're pivoting with that.
So that kind of makes me a little bit optimistic uh for the future of ETH here.
Uh, and I do agree with you, it is good for the L1.
Um, I think that there's been an enormous amount of conversation around just this thing, right?
Institutional adoption of Ethereum, increased wallets, increased transactions, um, and just a lot more value settling on ETH here.
Uh, as different from Bitcoin, different from Solana, what's your outlook on ETH?
Do you have a specific like thesis around that asset?
Or like what is your outlook for Ethereum here with all this institutional activity we've seen on ETH?
Thank goodness for Tom Lee, because I was saying that ETH looked irrationally bottomed and that it should go up for many months, if not years before it actually did.
And then he came in and sailored ETH for us and uh made it go up.
Although obviously it's uh come home a bit since then.
Uh I think that uh all those narratives are accurate, right?
I mean, you have BlackRock and other institutions obviously favoring Ethereum when they choose where to build.
It historically has the most TVL and value on chain, which obviously is compelling.
If somebody's going to build something new, they want to go where the money is.
And so I don't think the fundamental narrative for Ethereum has changed much at all.
It's only strengthened.
Obviously, the price hasn't necessarily tracked that entirely.
It's underperformed a lot of the market.
Uh, if you don't count the Tom Lee boom that happened, uh, but yeah, I I don't see any reason to be particularly bearish on ETH.
I think it's only going to continue to find more adoption and growth.
Gotcha.
I want to ask you a little bit more about some of these um theses, meta-narratives uh around tokenization, real world assets.
ARC put out a report recently calling for $11 trillion dollars of tokenized real world assets um by 2030.
Um BlackRock published a report recently as well saying that 65% of RWAs are right now on Ethereum.
Um they're poised to continue growing that market share.
How big of a deal is this tokenization push?
How fast is this going to happen?
And do you expect Ethereum to continue to capture the lion's share of that market?
I do.
Uh although I think there'll be plenty for everyone if we get to the multi-trillion numbers that they're discussing.
And ETH probably can't handle all that in and of itself.
I believe that this week tokenized treasuries reached 10 billion.
And it wasn't that long ago that that was one, two billion dollar nascent small market.
You know, BlackRock was participating, Franklin Templeton.
Now I think it's Ondo and Securitize and Circle are actually kind of leading uh in that area.
So $10 billion is a drop in the bucket when you look at the addressable market for tokenized assets, but still a meaningful number.
It's a lot of money.
Um, and I think that that's a trend that just continues.
And we talk about tokenization, you have Paul Atkins at the SEC talking about project crypto and tokenizing everything, like all markets by 2026.
They had the DTCC, which settled four quadrillion in volume a year, saying that they got no action letter from the SEC and making an announcement with Canton Network of all things, and then moving forward with plans to tokenize everything by the end of 2026, right?
So uh that would obviously be superior to T plus two or T plus one or T plus zero settlement when you can settle everything in a matter of moments.
So I think that that trend is unstoppable.
I definitely think that blockchain rails are better technology for settlement, faster, cheaper, and uh obviously secure.
The question is whether any of that'll be able to be captured by retail, right?
Like if all that happens in walled gardens on private blockchains with their own tokens from JP Morgan coin to BlackRock coin, then it's gonna be great to see our favorite technology adopted, but we're all going to be left in the cold as to making money on it.
So I think that remains to be seen.
You can see the technological adoption without actually the investment upside.
Yeah, that's sort of the nightmare scenario, but it seems like that's a scenario that some people are pushing towards.
We'll see.
I think this is all still prototypes and uh sort of a messy middle while people try to figure out what product market fit looks like here.
Um, but it's something I'm watching closely.
Uh, I want to ask a little bit about your thoughts on Solana here, because I'm I'm encouraged to hear that you're still a bull on Solana.
I think that Solana of most of the majors has seen a lot of just gotten really beat down on price recently.
It's around 84 at the time of recording.
Um, what's your thesis on Solana as differentiated from Ethereum, Bitcoin, and the rest of the altcoin space?
And particularly what I want to know is that, like, you know, uh things like hyperliquid, other chains, SWE uh have come up and sort of competed with Solana.
How do you see Solana's thesis here strengthening?
Are they going to pivot towards institutions in a way from retail?
Are they going to make a recovery in other ways?
Like, what do you see as the path for Solana here?
I think it's interesting.
I think the reason that Vitalik is saying what he is about the L1 versus L2s is probably because of the success of Solana and other chains that have not needed L2s and have not been fragmented.
So I think that A, Ethereum was early and had a plan, and then better, faster, cheaper chains came along.
And so of course now he's saying Ethereum needs to be primarily the L1, right?
So I think that there's a fear that Solana or the others collectively could eat their lunch, and that's why he's saying those things.
So just to kind of go back to the previous question.
When you take a look at Solana, it's an agnostic technology, right?
It's fast and it's cheap.
And so I don't know that the Solana Foundation will be the ultimate decider of what is built on Solana.
I think it's just gonna be a matter of individual entities deciding where they want to deploy and where that value is captured.
And I think Solana has as good of a chance as anyone else, certainly uh a close second to Ethereum and everyone else you mentioned far in the distance.
I mean, hyperliquid is really compelling, but I think it's more about the perpetual exchange than it is about capturing outside value on their blockchain.
But I don't know that BlackRock would go tokenize treasuries on hyperliquid, right?
Uh that could happen on Solana.
That could even happen on a SUE.
I'm not saying any of those would.
Uh, but we're in this interesting sort of paradigm shift right now.
If you had this conversation in 2021, we thought that there was gonna be so much adoption and not enough block space.
We used to have these conversations all the time.
Oh my God, we can't scale to a billion people.
There's no way.
Like we don't have the block space, we don't have the speed.
Now we can scale to the population of every planet in the you know, solar system and beyond or the universe, and there's nothing to fill that block space because it just hasn't been adopted, right?
People just keep building L1s.
There will always be enough block space speed for a billion people to come online.
Now we just need a reason for a billion people to come online.
So I don't think that we're there yet.
So I don't see enough uh food for all of these L1s to eat at the moment, but it's good that we have them there in case we actually find some uh meaningful use case.
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Gotcha.
Well, in terms of meaningful use cases, I did want to ask you about this, so I'll pivot in this direction.
Um, but stablecoins did 10 trillion dollars of volume in January, which is competitive with Visa's annual numbers for transactions settled, um, which is I think around 15, 16 trillion.
But that's a huge number, a huge growth in adoption of this uh this uh application of blockchain technology.
You recently did an interview on your channel, uh, the Wolf Wall Street's channel with Bo Hines and Paolo Odorino from Tether, talking about their company, how it's moving from um being uh a stable coin company to a stable company.
Um, I I really was interested in hearing your thoughts on takeaways from that conversation and and how stable coins are developing here and what this adoption means for for the asset class overall.
It's interesting once again, because I think there's an irony for Bitcoiners that arguably the killer app for crypto was tokenized fiat, right?
Because Bitcoin was obviously created as a hedge against money printing and as an answer or a placement for fiat to become the global reserve currency, but beyond Bitcoin, the next killer use case has been, you know, tokenized dollars.
And that's what we're talking about here.
So first I'd just like to point out that irony because uh it's definitely taken some of the shine off the peer-to-peer cash narrative that Bitcoin was originally created with.
That said, uh stable coins are unstoppable.
It's the same conversation as tokenization.
Table coins are unstoppable, but how are we gonna make money on that?
Right.
I think that people are going to definitely use them because once again, they're faster, cheaper.
I can send five or ten bucks or fifty cents or five million dollars to someone across the planet instantaneously without a third party in between to settle it, no bank to block my transaction or call me for a fraud alert for pennies.
So people are gonna do that, and institutions are gonna do that.
So I think that this is the future once again of payment technology.
I mean, you pointed out some of the transaction volumes.
It's absolutely insanity when you take a look at it uh and only growing.
There's a metrics that's found the full hockey stick of parabolic adoption.
Whether we'll be able to make money on it, I don't know, but everybody's going to be using stable coins.
And to be honest, I think the moment when we know that stable coins have really won is when we stop talking about stable coins.
And when it's just the underlying technology of how people send money, right?
So, like it could be integrated into PayPal or your bank or wherever, but you just know that you're sending a dollar from yourself to someone else somewhere in the world and it's fast and cheap, and you don't care if it was USDC, USDT, Swift, ACH, if it was on Avax or Ethereum or Solana, you just sent money and it worked.
And it's as familiar as any way that you've learned to send money now.
Yeah.
So I think that that's uh the big question that everybody has about a lot of these things, which is when is all of this fundamental adoption and growth uh going to translate into increased investment in digital assets?
One of the hangups for that, and one of the catalysts for the recent sell-off we've seen, at least in some people's opinion, has been the clarity being delayed again.
Coinbase withdrew their support uh and you know, have been coming back to the table.
The president has now hosted two summits, actually, one today is happening again in the White House with representatives from the banking industry from crypto.
Are we going to get a Clarity Act passed?
Are they going to resolve this fight over stablecoin yield?
What do you think happens here?
What's the outcome you're expecting?
So I think I was totally wrong.
Uh, I was one of those guys who said Clarity Act definitely passes.
Genius Act passed.
We have, you know, a favorable administration, favorable regulators.
There's no anti-crypto army anymore.
They all died.
Uh then they came out again.
Right.
So I think the anti-crypto army was in hiding, and Trump's involvement in the industry itself, for better or for worse, has probably empowered them to or emboldened them to come back out of hiding because it's not so unpopular once again to be anti-crypto.
So I think that that's a problem.
I thought the Clarity Act was going to pass.
When I saw Coinbase pull support, and then I started really digging into the issues.
It wasn't just about stable coin yield, it's about a lot more things.
But the biggest thing that it's about is the ethics clause and Trump's family involvement in crypto.
And Democrats are certainly not going to vote for a Clarity Act that allows him and his family to benefit or profit from the industry.
By the way, I think that if they're going to do that, they should also uh you know eliminate trading by Congress and uh Nancy Pelosi's God tier hedge fund skills.
But uh you know, uh shifting from that, he's never gonna sign one that has that clause, right?
So we can talk about the yield issues, unstable coins, which I think are big issues, or the attack on DeFi or the bans on tokenization, all the things that are listed as the reasons we haven't come together yet.
But I think that's the biggest one.
So yeah, I just don't see it happening.
And I think if it was going to happen, or if it is, it has to be really, really soon before midterms kick in and it just becomes a side issue, right?
Like crypto is not going to be an important issue once everybody's raising money and campaigning for the midterms.
And by the way, we don't want the Clarity Act that comes uh if it's the other party in power.
Yeah, I think that we will get some version of this bill signed, but I agree with you that whatever version does come through will be uh, let's say greatly compromised, watered down, and and maybe not even as effective as as what we hoped for in the first place.
So um I'm I'm paying close attention to this as well because I do think it is important, much more so than maybe some uh retail investors realize.
Um, and you know, like like Brian Armstark said, no bill is better than a bad bill, and that might be what we have to settle for, but we'll see.
I'm I'm watching that closely.
Uh Scott, I wanted to ask you some questions about the the macro landscape uh that we're in right now, because I think a lot of retail and crypto investors have had to learn a lot about macro.
I host the Milk Road Macro channel.
I know you have your milk uh your macro Mondays uh episode, your shows on the the Wolf of Wall Streets podcast.
Um Kevin Walsh has been named by Trump to be the next Fed chairman.
There's been a lot of hand wringing about him being hawkish.
Um I think that's overdone.
I think he's gonna be very dovish and very like supportive of the the president's agenda to run it hot.
What are you expecting from Kevin Warsh as chairman of the Federal Reserve?
How do you see this chairmanship impacting the crypto markets?
I don't say think that Trump floated Warsh uh to be a hawk, right?
And I and listen, first of all, like I remember the good old days of when we cheered Gary Gensler being appointed the uh chair of the SEC because he taught blockchain at MIT and he's one of us.
And you saw how that went when the politics kicked in and he actually got into office.
So someone's opinions of the past I mean, Donald Trump himself used to be a Democrat, right?
So it's not like people don't switch their opinions or uh their their views on how things should be run.
And so I'm assuming that Warsh will get in line with Donald Trump's wishes because Donald Trump wouldn't float somebody that won't.
So yes, I think that Warsh is going to be supportive of running it very hot.
They actually, you know, I think him and Vicent will be working together, which is something we haven't seen for a very long time.
They've talked about literally like coming together as an organization to to uh push policy.
That was an announcement this weekend.
I don't remember the exact terminology they used for it, but it was pretty uh eye-opening.
So yeah, I think Warsh is going to uh cut rates and help them to run it hot, at least into the midterms.
That should be supportive for crypto, but I still believe that the Fed itself has kind of been neutered and it's not nearly as relevant as it once was in a fiscally dominated world.
That said Bissent also wants to do all the things that would probably be supportive of asset prices.
So uh the environment should be good as long as nothing crashes.
Yeah, that's always the nice little asterisk setter's pair of things.
Yeah, that happens a lot.
But I agree with you on this.
I think that there's going to be a sort of renegotiation of this relationship between the Fed and the Treasury.
But, you know, regardless of how they draw those lines or what the outcome of that is, it seems to be constructive for markets.
Um, another thing that analysts have been paying attention to, um, specifically here at Milcode Macro, we've been talking about this a lot.
We seem to be in an environment where we've got low inflation, the dollar's weakening, weakening, it's dropping on the DXY, and the ISM now has reaccelerated above 50.
Historically, this has been a recipe for a Bitcoin bull run.
And, you know, these words are kind of taboo right now, but an alt season.
Um, the economy's heating up.
What do you think this means for crypto?
What's your outlook here on the macro picture that we've got?
So I ascribe to the views of Raoul Powell and Tom Lee, you know, the the gigabulls who have been, I think, beating the drum on the ISM business cycle narrative.
It's not something that I had dug deeply into or that I still am wildly on top of.
Once again, we have good historical correlation, but causation correlation, not sure, right?
We have like two data points, maybe three.
So uh I think that uh it's a very compelling narrative.
That said, the business cycle should have already pumped in years past and it's just remained flat longer than ever.
So the expectation that it has to end up happening now, I find a bit dubious because maybe it just stays flat for another year.
I don't know.
You know, past performance, not indicative of future results.
So uh if it does ramp up, I would anticipate, just from following the views of others that we could see, you know, some bullish narratives emerging.
Do you see some of this movement we've seen in precious metals having splash damage on the crypto markets?
Because there's like you said, you mentioned silver having this huge correction.
There's try I think it was a one day um where the the market capitalization of gold and silver swung by over 10 trillion dollars in a single day.
What's your view of the fallout from that and this wild speculation we've seen in precious metals?
It was so stupid.
Um, I mean, you know, there's no way that silver should go up six X in a matter of months.
And I've heard all the cope, I've had guests, we've discussed and debated it.
I hear them talking about lithium ion batteries and silver's industrial usage.
Well, that was the same at 20 bucks as it is at 120 bucks.
That's not what drove price higher.
Now, maybe on the way up, people who actually needed silver for industrial purposes bought a lot more because they were afraid that the price would be higher and that they wouldn't be able to afford to run their businesses.
That's part of it.
But this was retail FOMO, and it actually kind of reminded me very much of previous alt seasons where Bitcoin being gold, those are the corollary, right?
Bitcoin would go up, and then all that money would get bored when it kind of started to trade sideways and try to find a home and it would go to ETH.
So let's call that silver, right?
And all the money pours into silver, and then grandma and cab driver and you know your barber start telling you about how silver, and that's how it was.
It went all the way up.
And then what happens at the end of alt season?
It crashes and the money goes back into Bitcoin.
So money might flow back into gold.
And silver, I think, is probably put in a peak for quite a while.
And uh, you know, the world keeps spinning.
So I think that a lot of that money is the same speculative money that would have been pumping crypto for an alt season in this quote unquote cycle.
So I do think that took the shine off.
I think the other thing that I've think I was pretty early on saying, although we don't really have the definitive proof, I think prediction markets have taken a big shine off uh crypto because we can talk, we can say that people were buying L1s and utility-based tokens for their deep belief in the fundamentals or whatever, but we all know that people are just speculating, hoping to sell them higher, right?
And if you were using crypto to gamble because you couldn't gamble anywhere else, now we're in a world where you can gamble literally everywhere else.
Sorry, I just yeah, that's it.
Seems like uh financial entertainment has really taken a lot of the capital and the attention out of the markets here.
Um, and I think that that's a valid uh you know, valid uh observation to make.
We'll see how that rotates and where that moves, right?
But like I think people are I there was one analyst I heard uh said that she was taking a cab ribe in New York, and one of her cab drivers literally turned to her and was like, central banks are buying gold, so I'm buying silver.
And she was like, We're done.
All right.
So let's let's bring this back to crypto.
Um, you know, digital assets have gone through these bear markets before, these these periods of extreme fear before.
You've been through this a lot of times before.
What is the biggest opportunity you see for investors in a in a market environment like this?
Is it just being patient?
Is it doing research?
What what do you see as the opportunity here?
Patience.
Nothing has fundamentally changed about the narrative for the select few solid assets in this market.
A lot still, you know, would need some serious tailwinds or development to catch up to the narratives that they've had.
But the the assets we've named before that have real adoption and have you know institutional products like Bitcoin, Ethereum Solana, those narratives have only strengthened while price has gone down, right?
So, like if you're taking the emotion out of it and you ignore what the price action has done as a short term.
If you liked Ethereum based on what you believed Ethereum could be, or like Solana based on what you believed it could be three years ago, this case for those is 10 times stronger now, right?
And the price might be the same.
So it's the same for Bitcoin, right?
I mean, look at all the incredible tailwinds for Bitcoin and ETFs and maybe strategic reserves.
Well, you love those narratives at 125.
You should be buying the hell out of it at 60 if you still believe in the same narrative.
So listen, price and value are not the same thing, right?
And people get very tied up in the price, but your fundamental belief in your research tells you what the value of an asset is.
And if the price is below your perceived value, you should be buying it.
And I think that Bitcoin, Ethereum, and Solana are all undervalued right now.
That is a fantastic answer, Scott.
We can leave it there.
I know you're coming to New York for Pompliano's Bitcoin Investor Week.
I'm gonna be there tomorrow, so I'll see you there.
Uh, what is your hopes for takeaways from this bear market Bitcoin conference?
Yeah.
So I've never been to this conference before.
I'm going uh with my friends Andrew and Tillman from Arch Public.
I think they're sponsoring the whole VIP area.
And we got together in Vegas at the Bitcoin conference, and we set up a little recording booth kind of in the VIP area, and I ran through a bunch of interviews and it was a lot of fun.
So I agreed all of like two days ago to come do that.
I again just on Thursday, I'll be there for a day uh in New York.
And so, you know, I'm gonna sit down.
I I know I've already scheduled uh Matt Hogan, Anthony Scaramucci, some of the bigger, you know, Grant Cardone, some of the bigger names will be on stage that day.
It's just a really fun opportunity for me to like knock out a bunch of conversations in one day back to back to back.
So I would love to say that I'm going for the conference or that I'll hear what's going on on stage, but I rarely do.
Uh, but uh, I think it's incredible that Pomp uh, you know, he sits down with all these people back to back and throws this incredible event.
I think that uh once again, you go to a conference like this, and it gives you a real idea of where the sentiment actually is, not just what you read the sentiment to be on Twitter.
Like I can remember going to consensus years ago, depths of the bear market.
I think it was in Austin, and you looked around.
And a year before, you know, it was like Coachella at a crypto conference.
It must have been 2022.
And then in 2022, I went to Consensus and it was like every other booth was a lawyer or like a bankruptcy attorney or a tax specialist, right?
I was like, wow, we've really like we're in the depths of the bear market.
But then I flew over to Singapore for token 2049 soon after, and it was still Coachella over there because in Asia, they weren't worried about Sam Bakeman free.
They weren't talking about regulation, legislation, they didn't care.
They were just having a good time building stuff in web three, right?
And now I feel like you probably get the same bipolarity between something that's retail and institutional focus.
So if you go to something retail, everybody's probably depressed because nobody participated or made money in this cycle.
But if you go to a conference that's Bitcoin, you know, institutions like this is, I think you're gonna just hear about all this incredible adoption and plans that they have for the asset in the industry, and you're gonna be bullish again.
So I'm just looking forward to, I guess, a little uh, you know, a little uh adrenaline shot of bullishness from other people besides myself.
Yeah, well, I'll see you there.
And uh I've I was at the the Bitcoin um and the consensus conferences in 21 and 2022, and you're right, it was is a much different vibe.
Um so I'm excited for this too.
It'll kind of uh bolster my spirits as well.
Scott, thanks so much for the conversation.
Always love having you on the Milk Road show.
Where can we send people to find more of you and your work online?
Just go to X uh at Scott Melker and you'll find everything else branched off from there, the YouTube channels and other socials and all the things I do.
Thank you, man.
I really appreciate it.
Absolutely.
I'll talk to you again soon.
Probably tomorrow.
Yeah.
Uh well, thanks, Scott, for being here.
Thanks everyone for joining us.
I hope you all learned something today.
So until next time, stay safe, stay educated, stay bullish, and we will see you on the next episode of the Milk Road show.
Thanks for being here, everyone.
Bye.
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