While we hope you enjoyed downtime during the holiday season and a lazy warm January, markets were buzzing with news and excitement. Crypto markets experienced multiple significant waves as massive players entered the market. We bring you another packed Rake Review to fill you in on the important and interesting developments.

Inflation numbers out of Australia showed official inflation (CPI) at a relatively low 4.1% down from over 5% last quarter. The quarterly increase was the smallest in almost 2 years. 

Why is this important? Well, everyone is closely following inflation numbers to see if the RBA will be likely to end its record breaking tightening policy and start lowering interest rates. Home owners (Variable Mortgage holders) are hurting from the quick rise in rates over the last year especially and this is starting to bite in the real economy.

If the loosening begins, we may see very bullish conditions for asset prices. Property could rise for the first time since rates started to bite and equities are already on a bullish path. However, Bitcoin and the wider crypto market could be the biggest winners. There are many reasons for this view. Firstly, Bitcoin's higher volatility pays dividends in a bullish and low interest rate environment (not literally). Secondly, Bitcoin could be a winner because this will coincide with the bullish part of the Bitcoin cycle. Bitcoin is already on a winning path with the halving approaching and the US Spot ETF's approved. Adding in to the mix improved homeowner cashflow and we could see a Bull Run for the ages!

In terms of Market Cycles, we are heading to the juicy part of the cycle where the biggest profits are made. If history is a guide, Bitcoin is heading towards the Hope & Optimism stage this year and possibly complete Thrill and Euphoria in 2025. Now History is just a guide and this time could be different but the exact same conditions exist. A whole new wave of Buying (Demand) is here with ETF's buying in bulk against the backdrop of Bitcoins fixed supply. There will only be 21 Million!

On the first day of trading Bitcoin ETF's saw $4.6 Billion in inflows with Blackrock doing over $1Billion alone.  The below graph shows the ETF inflows by fund. As the ETF's swallow more and more Bitcoin it will become evident that there is not enough to go around and the price will reflect that monumental demand shift.

Everyone has probably heard about the disaster that was FTX in 2022. The exchange went down in metaphorical flames and took with it the whole market leading to sub $17,000 Bitcoin and the absolute panic of November 22. 

It was all caused by FTX's subsidiary trading company Alameda Research losing Billions on the biggest trade of the last Bull market cycle. The GBTC premium trade brought down some huge names that are no longer here. We won't go into it too deeply here but its really the central issue that brought the last bull run to a premature halt. We thought that SBF (Sam Bankman-Fried's) Trial would be the last we heard of that sorry saga however that hope was a tad premature. The great news of the ETF approvals was dampened by the fact that the FTX bankruptcy estate is now finally able to get rid of its GBTC shares and in turn the sale of BTC which pushed the market lower for the biggest DIP we've seen for months.

After a stellar run for Bitcoin and the Alts, Bitcoin dipped in the post ETF approval "Sell the Rumour" phase spurred on by FTX related BTC sales. BTC fell from over $47K to under $39K USD in a fall described by one crypto OG as "What is this a crash for Ants?"

The old heads know that a 15-20% correction on the way up is a healthy consolidation. It was however interesting to see that many were panicking and expecting BTC to fall below $38K USD. It got us thinking about the fear that investors experience being an even more powerful motivator than greed at times.

In the field of behavioural economics there is a concept called "Loss Aversion". This concept states that the emotional and psychological impact of a fall is perceived by investors as more impactful than a gain of the same exact magnitude.

In other words people are irrationally affected by falls more than they should be. It's an interesting concept and we think it played out nicely in January. Here is an asset that is up over 100% even at the very worst of the DIP since November 22. Every investor on this ride should be happy but yet many were fearful. Here is an asset that is heading to a supply shock (The halving) at the exact time of a demand shock (ETF approval) and yet a small fall sees some want to sell.

Well a week on from the worst and BTC has already recovered 10% and Alts are also bouncing. The constant buy pressure from the ETF's is eating up all the cheap BTC from any panicked weak hands.

• Short term pain vs long term gain. FTX/GBTC drawdowns weigh on BTC price in January as ETF demand starts in perpetuity 140,000 BTC was bought in the first 11 days of the ETF's operation.
• In signs that the US economy is over the Banking crisis on 2023 and moving towards a new expansionary cycle of interest rates the Fed Board announced it will be ending the BTFP program propping up the banking system.
  
• Coinbase appeared in court defending itself against the SEC. The SEC has come off significant defeats against its crypto over regulation recently with the largest of those defeats to GBTC. Coinbase is also likely to win with the giant exchange trying to work with regulators without any luck so far.
  
• Dr. Arthur Leffer says “You can have a system that uses #bitcoin as the monetary base”, seemingly endorsing the possibility of major economies being based on BTC. An incredible statement from the "Father of supply-side economics".

In case you wanted to know what the worlds leaders were discussing at Davos January 2024. I guess Covid-19 is no longer an issue.

If you enjoyed this Rake Review, feel free to open an account and gain access to more proprietary research and work with your very own dedicated crypto broker.

The Arbitrum Airdrop has finally been confirmed and with it a whole flurry of expectations and speculation as to what will happen next. We here at Stormrake have been anticipating this for some time now and had informed our clients as early as mid October 2022 to prepare for this incredible opportunity. Read on to get prepared for one of the biggest airdrops of 2023.

The information contained here is for general information only. It should not be taken as constituting financial advice. Stormrake is not a financial adviser. You should consider seeking independent financial advice prior to making any personal investments.

Having looked at the distribution and qualification metrics, we can tell that a lot of thought and effort has gone into this airdrop to ensure it's rewarding the most genuine users of the Arbitrum ecosystem. The ARB token itself will be supported by most major exchanges on the day of the airdrop and will enter price discovery almost immediately. 

Please read our previous article on Arbitrum HERE to understand learn about our airdrop expectations and how the initial price discovery period can potentially play out.

We're pleased to announce that we will be supporting Arbitrum from day one with full brokerage services. So if you have managed to qualify for the airdrop and wish to sell or swap your ARB tokens or wish to put in a purchase order with your Stormrake broker, please do not hesitate to reach out. We will also support wholesale OTC trades prior to the airdrop launch.

If you enjoyed this Thunder Trading, feel free to open an account and gain access to more proprietary research and work with your very own dedicated crypto broker.

Here is the fast five of what you need to know about the crypto market in October 2022:

1. Bitcoin finally broke out of an incredibly tight range and gained 5.73% for the month and has eyes set on testing the $22,000 USD level.
   
2. Ethereum has had a superb month having added 19.20% for the month as it looks to have shaken off the "post merge" sell off.
3. The total crypto market cap grew by 7.05% having added $65 billion USD in October. 
4. The best performing coin for the month was DOGE having moved up in value approx. 93% for the month. Elon Musk completing his purchase of Twitter provided the speculative catalyst for the move higher.
5. The worst performing token was ETHW as it proceeded to slump by 64% for the month of October. This is simply due to the forked token having a dead chain with close to no meaningful activity.

• OPEC cuts oil production to drive up prices creating a potential rift between the  once strong US - Saudi relationship.
  
• Elon Musk completes Twitter takeover worth over $44B USD
• BNB Chain was halted after $570 Million USD was hacked 
  
• Visa partners with FTX to provide the exchange with their own debit card
  
• Grayscale Investments files lawsuit against the U.S. Securities and Exchange Commission
• Aptos debuts its blockchain to a near $1 Billion USD valuation 
• Sam Bankman-Fried, founder and CEO of FTX releases draft proposal of a controversial industry regulation standards
• Bitcoin begins to break its correlation with US tech stocks
• Australian government confirms Bitcoin and other digital assets will be subject to capital gains tax laws
• Liz Truss ends reign as Britain's shortest serving Prime Minister

Monday morning in Asia has created a 'max bidding' environment where everything from equity futures, commodities and of course crypto has made a substantial run higher. 

The information contained here is for general information only. It should not be taken as constituting financial advice. Stormrake is not a financial adviser. You should consider seeking independent financial advice prior to making any personal investments.

Ethereum is currently trading above its key level of $1,333 USD and is likely on a path to retest $1,400 and make a push towards $1,472. To the downside, if we track back below $1,333 then a sharp move back down to $1,241 can't be ruled out. Worth noting is that Ethereum is nearly deflationary post merge, with supply growth up only 0.08% over the last 38 days. The reduction in supply should not be discounted too heavily, this can cause a quick acceleration in price once the impact is felt.