Bitcoin in the Danger Zone
Bitcoin has entered what can fairly be described as a danger zone. The market has officially put in a lower low under the 200-week exponential moving average — the first time it has closed below that level since 2023. Historically, the 200-week moving average has tended to mark something close to fair value and has repeatedly proven to be a great buying opportunity. The open question, however, is whether that pattern holds this time, today.
The case for caution comes from relative performance. Over the last two years, nearly every other major asset has dramatically outpaced crypto. The S&P 500 is up 34% over two years. Gold is up 75% over two years. Nvidia is up 69% over two years. Yet Bitcoin has returned essentially 0% since 2024. Everything is outperforming Bitcoin and crypto over the last two-ish years. Bitcoin had a strong run through 2023, into 2024, and into the beginning of 2025 — and now it has become a laggard.
The Logic of Buying Out of Favor
Why should anyone buy Bitcoin to push it back to $100,000? The argument rests on a core principle of investing: you want to buy things before they are in favor. The goal is to be non-consensus first, then hold the asset as it becomes consensus. The best time to get involved in an asset is precisely when everybody has forgotten about it.
Did people buy Bitcoin at $100,000 on a recommendation, only to watch it fall? The clarification offered is that there was never a specific "recommendation" to buy at a single price. The long-standing message has instead been to dollar-cost average into Bitcoin — to point toward averaging in over time rather than timing a single entry. After the $100,000 level, Bitcoin did rise another 25% from there, before subsequently falling. The blunt counterpoint acknowledged is that it is now near half that value, down to around $58,000.
The Role of Volatility
A central argument in defense of crypto is a reframing of volatility. Over the last 10 years, Bitcoin has compounded at roughly 60% every single year. Achieving that kind of return requires volatility. One of the biggest misunderstandings in investing is that most people are scared of volatility — they run away from it and hide in bonds. But bonds are characterized here as losers: you hold something that doesn't move at all, and it simply loses value over time.
The best investors in the world, by contrast, actively seek out volatility, because that is ultimately where returns come from. At the moment, AI represents volatility to the upside, while Bitcoin represents volatility to the downside. Looking out over the next couple of years, both of these assets are expected to remain very volatile — and that volatility is exactly where the returns are projected to be.
The Real Reason Crypto Keeps Bleeding: Global Bond Markets
If so much underlying news is bullish, why does crypto continue to bleed out? The answer offered is that global bond markets are imploding, and this is stealing liquidity away from risk assets.
Yields are rising across the board: Japan's bond yields are climbing, German bond yields are climbing, and U.S. 20-year and 30-year bond yields are climbing. The mechanism is straightforward. When money can earn a higher yield by parking itself in a "safe" instrument backed by governments, big money reasons that it can stay safe and earn a better return — which incentivizes it to keep its capital there. The result is less money, at least in the short term, flowing into riskier assets like crypto. The expectation, however, is that this dynamic will eventually change.
Micro-Catalysts Beneath the Headlines
A distinction is drawn between the dramatic, headline-grabbing "grand gesture" events that outside observers wait for, and the quieter "micro-catalysts" visible to those working inside the industry. From the vantage point of Coinbase's head of institutional strategy, these smaller developments occur almost every day without making the front page:
- The first stablecoin-based payment for independent journalists was completed, condensing the time they take to receive advertising revenue from 90 days down to one day.
- Blockchain and cryptocurrency are being used to solve the problem of AI-driven deep fakes (a project associated with Scott Sornetta).
- More than 40 countries have committed, in some fashion, to buying Bitcoin for their national balance sheets or other purposes.
The overarching observation is a daily deluge of new institutional investors interested in the asset class. For those on the inside, the picture is one of steady growth — even when the headlines do not match that reality.
OpenUSD: Big Institutions Build the Rails
A major piece of news is the launch of OpenUSD, a new stablecoin, and the simultaneous collapse of Circle's stock — the company behind the USDC stablecoin — which fell over 16% on the announcement. Circle entered freefall after Visa, Google, BlackRock, Coinbase, and more than 100 other institutions announced plans to launch OpenUSD, described as "a stablecoin built for the internet economy, designed by the businesses growing it."
OpenUSD is built around three key design principles:
1. Built for scale — businesses can mint and redeem OpenUSD at no cost and with no artificial limits on volume.
2. Yield by default — partners receive all of the earnings from OpenUSD's reserves, less a small management fee to cover operational costs.
3. Collaborative governance — all the institutional partners (BlackRock, Google, Coinbase, Visa, and others) jointly control the protocol as a conglomerate, rather than control resting with a single entity.
The roster of partners is striking. In payments: Visa, Stripe, Mastercard, American Express, MoneyGram, Western Union, and more. In banking and finance: BlackRock, BNY, Standard Chartered, and smaller banks. Beyond finance: Google, Samsung, and DoorDash. DoorDash's involvement makes sense given the enormous daily transaction volume it processes — it wants something faster, cheaper, and settled more instantly.
Is This Even Crypto?
An obvious objection is anticipated: this is not decentralized, not permissionless — it is permissioned, and looks like a system of control by large corporations. The response is that stablecoins are by definition permissioned and by definition controlled by a centralized entity. That is simply their nature. Bitcoin and Ethereum remain the decentralized, permissionless protocols, and the expectation is that both kinds of systems will grow in tandem — there is room for everything as the space blossoms.
Crucially, the argument turns the objection on its head: the bigger and more powerful permissioned systems become — Visa canceling a transaction, Coinbase going down at the top of the market so you cannot sell, DoorDash or Google harvesting and using your data, transactions being canceled at a whim — the greater the need for decentralized, permissionless alternatives. In that sense, the rise of corporate stablecoins is itself bullish for genuine crypto. The deeper signal is that if BlackRock, Google, and Visa are integrating blockchain rails into their businesses, crypto is not going away — it is being baked into the plumbing of the financial system.
Which Chains Win the Infrastructure Race
A recurring question is which cryptocurrencies will serve as the underlying infrastructure for all of this activity.
OpenUSD appears to be multi-chain. Solana is backing it (described as good for Solana). Ripple is backing it (potentially via Ripple's RLUSD). It also touches Ethereum, Polygon (an Ethereum Layer 2), Stellar, Aptos, Plasma, and Rain — a new network.
Other signals point in similar directions:
- SoFi, a major financial company, has seen its SoFiUSD stablecoin supply grow from 100 million to 300 million in just five weeks. The best place to find liquidity and user growth for stablecoins is identified as Solana, and SoFi chose Solana. While this growth has not yet affected price, it represents real, growing transactions and users on the network.
- Binance announced it is the first crypto exchange to partner with Anchorage Digital to bring tri-party banking to institutional crypto trading. Both are described as reputable companies. The partnership gives institutional clients a trusted option for tri-party banking, letting them maintain independent, segregated custody of their assets while still accessing Binance's liquidity for trading — separating custody and execution the way institutions expect.
Ethereum's Network Effect
When examining tokenized real-world assets (RWAs) by asset class — U.S. Treasury debt, commodities, asset-backed credit, corporate credit, stocks, U.S. government debt, and more — a notable fact emerges: more than half of all tokenized RWAs are live on Ethereum's mainnet. This demonstrates Ethereum's powerful network effect. It may not be the fastest or the newest chain, but institutions like the network and join it to connect to its liquidity.
The Survival Problem and the Long View
A sobering caveat is acknowledged: most cryptocurrencies do not survive more than a few years. Of 2021's top 100 coins, 89 of them are worth less today, while Bitcoin is up 81% over that span. The practical question this raises is which altcoins are still showing genuine potential — the rationale for staying continuously up to date on the news in order to maintain an investing edge.
Taken together, these institutional signals suggest that the 200-week moving average may indeed represent a significant buying opportunity for what could be a payoff three to five years from now. The thesis is that crypto as a space is only growing, even as short-term price action remains weak under the pressure of rising global bond yields.
A Note on Catalysts
On the question of what catalyst could push Bitcoin back above $100,000, the answer explicitly set aside is the Clarity Act. Congress has scheduled a hearing on the Clarity Act for July 17th, but rather than pinning hopes on that single legislative event, the more durable case rests on the steady, structural integration of crypto rails into the global financial system described throughout — the institutional adoption, stablecoin launches, exchange-bank partnerships, and tokenization that continue to build beneath a bleeding price.
