The Overton Window
A Shifting Discourse
Things are moving fast in the digital asset market. As we estimated in our How Crypto Impacts Politics in 2024? article, crypto will have a significant effect on the upcoming US election.
22 percent of US citizens own digital assets. During the previous presidential election of 2020, approximately 240 million people were eligible to vote and roughly 66.1% of them submitted ballots, totaling 158.43 million votes.
If we assume the turnout to remain same in 2024, the United States could have 34.9 million active crypto-related voters, forming a significant voter segment. Those candidates who can most effectively profile themselves as crypto-friendly will reap the benefits of this new segment.
MicroStrategy's Michael Saylor recently wrapped up these themes, while significantly changing his previous discourse:
"Two weeks before, the world looked like bitcoin was the only asset to be securitized and offered as a spot ETF by the Wall Street establishment, and it was going to spread as the one legitimate crypto asset.
I think right now the best expectation is that crypto asset class will be legitimized and supported by both parties. There's an industry, crypto is an asset class, there's an entire range of use cases: 24/7 digital trading, digital art, NFTs, tokens, DeFi... There are a lot of things that will be considered in a more open light.
...
I think we're politically much more powerful, supported by the crypto industry. They obviously have a lot of political power, users, and they serve as another line of defense for bitcoin."
As signaled by Michael Saylor, the crypto industry has now reached its Overton window, widening the range of politically acceptable mainstream subjects. The Overton window for bitcoin has been shifting over time, with the cryptocurrency moving from being seen as a fringe or unacceptable idea to becoming more mainstream.
Source: What Bitcoin Did
As bitcoin has grown in adoption and acceptance, the Overton window for it has shifted, making it more politically viable for politicians and governments to support and embrace the digital asset.
Politicians like Ted Cruz and others are now openly embracing pro-bitcoin policies, showing how the Overton window has changed. In contrast, countries like China have tried to keep bitcoin outside the Overton window by cracking down on it, but this is seen as a mistake that will backfire as bitcoin continues to gain mainstream acceptance.
Source: Quicksilver
As mentioned in our previous article, the following list portrays US presidential candidates and their approach on cryptocurrencies:
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Democrats:
Joseph Robinette Biden Jr. (negative)
Jason Michael Palmer (neutral)
Marianne Deborah Williamson (neutral)
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Republicans:
Donald John Trump (positive)
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Independent and third-party:
Robert F. Kennedy Jr. (positive)
Jill Stein (neutral)
Cornel Ronald West (neutral)
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Donald John Trump has profiled himself as a crypto-friendly presidential candidate, and seriously aims towards the November United States presidential election, occurring in 161 days.
Source: Steno Research
Last week, Trump promised to free Ross Ulbricht, the founder of the Silk Road dark web marketplace, during his speech at the Libertarian Party convention in Washington DC. Trump pledged to commute the prison sentence of Ross Ulbricht if he is re-elected, stating, "If you vote for me, on Day One I will commute the sentence of Ross Ulbricht."
Bitcoin Resembles the Late 2020 Structure
"When the next bull run really happens, all the action will be in 30 days or less. My gut feel, we double these levels inside of a month once the kraken is awake." - Fred Krueger
From a purely technical perspective, bitcoin is now showcasing new momentum, after falling to $57,000 in May's deep technical correction. Last week bitcoin momentarily reached $71K, approaching the all-time high level of $73K.
In a bigger picture, the current market structure resembles late 2020 and its technical wedge, as bitcoin consolidated before the parabolic advance. If bitcoin mimics the last cycle, $100,000 is a reasonable and a rather modest price projection.
The $100K target in 2024 is also supported by bitcoin's power law model. Additionally, power law forecasts a $142K level by the end of 2025. Stock to flow (S2F) model expects even higher valuation levels.
Sources: Timo Oinonen, CryptoQuant
We expect the quarters two (Q2) and three (Q3) to be an epoch of elevated spot prices, eventually leading to a double top structure in 2024. From a shorter term perspective, the escalating bid liquidity at $72,000 acts as a magnet to bitcoin's spot price, indicating a potential pursuit towards a new all-time high.
Cumulative volume delta (CVD) shows the retail segment remaining relatively inactive, while the whale level buyers are in accumulation mode. Large $1M - $10M category orders have been in an elevated role during the past weeks.
Source: Material Indicators
Google Trends data supports the CVD's retail inactivity. The market is currently in accumulation phase, and institutional demand could easily uplift bitcoin to $100K, that acts as a critical psychological level for retail attention.
Source: Google
Is Ethereum's spot ETF Triggering an Altseason?
Within the past seven days, multiple altcoins have showcased good performance, with Uniswap (43.7%), Ondo (34.2%), and Ethena (31.9%) being prime examples. These altcoins might be uplifted by spot Ethereum ETF news, boosting ether by 26.9%. In Ethena's case and in contrast to the efficient market hypothesis (EMH), some retail investors might even confuse between Ethereum (ETH) and Ethena (ENA), although the latter has a compelling investment narrative as well.
Source: Blockchaincenter
Blockchaincenter's altseason indicator shows a value of 35, not indicating a proper altseason yet. However, as mentioned in previous articles, there might be a "selective altseason" in play.
In our earlier articles we took a closer look at newer high beta tokens like Ethena. For Ethena's ENA token, the current float (supply available to the public to trade) is only 0.09, meaning that 91% of the supply is at the hands of the founders or locked in by VC investors. In general, the float of newer high beta tokens remains extremely low.
