Why Bitcoin fell below $100K: Delphi Digital on the October liquidation cascade

Transcript

If you do see stocks, you know, start to like settle out and then just start grinding back up again, then you should probably just see liquidity come back into crypto. What's up everybody? It's LG Ducet here and welcome to the Milk Road Show, the daily crypto show that makes sense of the market so you don't have to scroll through 200 charts on a Saturday. Today is November 14th, [music] 2025. Bitcoin is currently hovering around $96,000, which would have been fantastic a couple years ago, but today feels like hell. It hit 94K this morning and it closed below 100K yesterday which a lot of people are pointing to as a terrible sign.

Everyone's wondering what is going on except for our guests today who are from Deli Digital. We've got Sataris for the head of research and Jason the head of markets. These are people that institutions look to when they want to understand the market from Bitcoin cycle all the way to you know onchain dynamics, meme coins, what's going on in the trenches. These guys look at all of it. They have released a new chart book that breaks down the short-term risk of Bitcoin in the aftermath of October 10th and where the opportunities may be even in a gloomy market like this. So, that's what we're going to look at today.

Before we start, we have a brand new podcast. The Milkro AI show has kicked off this week. Episode one is with Mike Novagrats breaking down Galaxy's data center empire. And episode two is actually out today. Uh should be out by the time you're listening to this. It covers the full AI stack uh and where the real investment opportunities are. Hit subscribe on Milk Road AI. Uh it'll be linked in the description and also sign up early for the newsletter as is coming very very soon. Today's episode is brought to you by Gemini credit card. Turn your everyday spending into Bitcoin stacks without even thinking about it. Block trust. Let AI outsmart the market and grow your crypto while you sleep and figure markets. Earn solid returns on your cash be because sitting idle is not a strategy. Let's get the boys in here.

Uh Jason Cedus, what is going on guys? Uh before we start, honestly, let's just look at the sentiment today and share this meme that Jason shared on X the other day. Perfectly summarizes it. Uh boom. It's and I'll read out the tweet for people that are listening. Uh it's uh this is from a couple days. This from yesterday. How I practice for the New York Open every morning. Uh and it's a it's a gift of of two, I guess, kung fu masters where one of them is just being kicked in the groin by the other one repeatedly. Definitely feels that way these days. Jason, is this is this how you wake up and feel every morning these days?

>> Yeah. Yeah. The last pretty much since 1010, it's just like I've I've aged like three years in the last month. Uh [laughter] >> right. >> Are you not have you not been in crypto for a while? Is this part of the game for this kind of stuff to happen? >> Yeah, it is. It is uh it is part of the game. I I do think um the the severity and violence of of 1010 was just like I've been in the I've been in crypto since like 2017, like pretty early 2017, and like there's been some violent liquidation cascades and and ADLs um in the past, but this one was like it kind of came out of nowhere too, right? Like it just like happened on a Friday after the markets closed because of a a Trump tweet. it didn't really spill over into equities because like you know Trump did

the taco thing over the weekend so like equities didn't even really react to it you know that Friday was kind of bad for them and then he tweeted like it was just like a very odd event that happened and caught a ton of people off guard and and and hurt a lot of different types of of traders that normally aren't affected much in a in a typical liquidation event. Would you argue that that today is worse because we've gone lower? >> Worse relative to Oh, like today like today relative >> I mean like today like will November 14th not be the new October 10th. >> No, >> I know it's not as it's not as violent but I mean we're the price of Bitcoin suck lower. Yeah, >> it sucks without a doubt, right? Like but we have like 1010 was like 1010 is what has led to this price action,

right? like you evaporated and maybe this is like a good segue to a later part of the chart book as well, but like 1010 evaporated 20 30 plus billion dollars of of open interest, right? And that's a huge wealth destruction event into a market that already was like kind of shaky, right? We we had some like short-term liquidity issues going on, government shutdown, liquidity stresses there. Um, so like you just had like a and already DATCO is not buying as much as they were, ETF flows tapering off. So you just had like a relatively like thinly supported market and then you just had a culmination of everything into like a little bit of a a black swan liquidation event that was siloed to crypto, right? Like 20 to30 billion of

OI is a huge wealth destruction event. And a lot of that is people that who would go bid all of the coins that are no longer, >> you know, no longer sustaining any bids because a lot of people's appetite has been, you know, wrecked. um market makers who typically wouldn't be that hurt in a liquidation event got more hurt than usual because of ADL, right? They got their for they had their like, you know, different legs of their trades that would hedge them closed out at different prices. So, they get hurt. You had people buying the dip getting ADL and getting hurt. You had shorts getting their positions force closed as well during ADL, so they didn't even make as much money as they should have. So, there's just like it's just like a huge like of crappy.

>> So, what's so what's happening? So what's happening this week? >> We're just digesting all of that. I think equities have also been weak. So right, you're seeing like equity weakness spill over to Bitcoin still. I think people are like waiting for um you know TGA spending to commence post shut down >> $1 trillion, right? That's in the TGA. >> I think you know money like there's just like a lot of things that I think people are waiting for and equity is being weak. Why would you go bid the most like liquidity like correlated asset at the time? You could might as well just wait. And so people who are just like buying these, you know, dips on leverage or like, you know, buying per to make these trades, right? Every every pump is kind of getting sold into, you know, bottoms aren't being bid as much. So I think

it's just like the market is digesting what happened after 1010. And a good anal like a good analogy I like to use for liquidation cascades, and this is something I talk about at the top of the chart book, which we could probably get into, is um there's a couple charts on on on slides >> here. Let's pull it up. Let's pull it up. Let's talk about your your chart like or we could start at the top and kind of like walk through the stresses here. Um >> definitely like I'd love I'd love to if you know and I think what's great about this chart book is it seems like you're telling me that it's going to help kind of explain everything that's happening right now. And I think you guys don't put these out all the time. So this I consider this a special edition chart

book uh exclusive to kind of the events of of what's happening right now. Um so definitely please like like show us what's the most important chart in here. I'm assuming it's probably the first one. So so please walk us through it. Yeah, we Yeah, let's just start at the top, right? So, like typically you always look at Bitcoin performance relative to equities, right? And and and see like is is is Bitcoin leading? Is Bitcoin lagging? And and potentially why? And and clearly Bitcoin has has lagged um the S&P as everybody has noticed over most of the last like uh year for the most part. And what we're seeing here is we're starting to see obviously like S&P 500 breath wobble, which means effectively like the percent of companies in the S& SP 500 trading above long-term moving averages is

decreasing day over day. And so what this means is like you get narrower and narrower equar and narrower equity leadership. Um, and it just kind of puts stress on the overall market because we can see the bid isn't really being extended to names beyond say the core few like the the mag seven or the AI names or the tech, you know, the tech names driving a lot of the AI capex, you know, boom or bubble or whatever you want to call it right now. Consumer sentiment on the next slide, clear divergence between consumer sentiment over the last um, you know, year or so and equity performance.

>> Why is that why is why is the consumer sentiment so so different? Because you've got you've got a shift here. Where's this where's where does this line cross where it's this sentiment is higher than >> that's like closer to 2020. You want to focus right at the end, right? Like right at the end like pretty much from that last dip in the in the equity market. >> Incredible divergence, >> right? It's it's a very big and it's just it's it's kind of part of a bigger trend and like >> I mean like this really started in like you know 2020 and I think everybody knows what happened in 2020, right? COVID inflation, everybody's [ __ ] got way more expensive. equity markets just pumped out of the lows because of all the stimulus and so you just get a big divergence in like what everyday

consumers feel and what the stock market shows. I think it I think it is pretty simple um like a pretty simple easy explanation to kind of generally account for the highlevel sentiment divergence between consumers and what the equity market is printing in terms of valuations and and earnings. >> Would you expect this to reverse? >> No. >> [laughter] >> stock higher, sentiment lower from here is what you're saying. >> I mean, like sentiment can probably just go sideways. It could definitely go lower, but like I I don't think we're going to see it recorrelate and and recon converge is probably better thing >> until you're in a significantly different >> Yeah. Yeah. Which will take a long long

time. It won't be these things are not one two year things. These are longer >> these are decades. Yeah. These are this is a 30-year chart. Yeah. >> Longer term cycles. Exactly. Uh next slide just shows funding market liquidity, right? So like funding markets are really important um just in terms of you know uh >> overnight plumbing, Fed liquidity, right? Just in keep the keep the money churning through the pipes and and and make sure people can borrow and and meet obligations overnight at at you know at at reasonable rates and we can clearly see rates for the overnight secured uh financing rate spiking, right? So it's right like these are just like all like small things but like you kind of want to just like see all different data points and like kind of fit the puzzle

together into like what what is happening. So like another sign of stress. Next next slide is you know bond market volatility with with US Treasury bonds like the the most important collateral asset in the world and typically when you see uh bond market volatility you see stresses in equity markets and people tend to tend to go risk off in in scenarios when you start to see these things spike right bond market volatility another thing that you just want to keep an eye on. The next slide is just a couple core macro risk ratios that right like SM like top left chart is the S&P 500 over uh Bank of America high yield spreads right so S&P grinds higher while high yield spreads grind higher right high yield bond spreads typically sign of like stress again right the the theme is like you're

seeing little signs of this short-term stress that have been developing over the last several weeks or a little bit longer which can maybe account for some of the equity weakness that we've been seeing over the last week or slide on or the top right is over TLT, right? Uh >> yeah, there's a couple on here. >> I'm just I'm eager for the Bitcoin, the Bitcoin ones. I want I want the crypto. Give me the crypto charts, man. >> Did you know you can earn Bitcoin without ever buying it? That's where the Gemini credit card comes in. Here's how it works. Earn up to 4% back in Bitcoin on gas, transit, and ride share, 3% on dining, 2% on groceries, and 1% on everything else. Use it just like any other credit card. [music] and you're building a crypto portfolio at the same

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250%. Visit milkroad.com/blockrustirra today to get up to 2500 in bonus crypto and transform [music] your investment strategy. >> Okay, go down to volatility. Right. So the next slide verse VIX, right? So this effectively shows you when VIX when VIX spikes um beyond a certain threshold that we have in our our little model here just highlights where it is on the Bitcoin chart. And typically if again if you want to go to the next slide, we kind of normalize >> and VIX just to remind our audience what is Vicity index. >> V volatility volatility index measures just like the the full fluctuation that the price can move.

It effectively yeah measures um >> expectations though it's expectations of future volatility right >> yeah it's yeah it's expectations of of future volatility in in this case we're using VIX for the equity market but you could use like a like a BVIV like a Bitcoin volatility index or or other things right uh >> right so these these big purple >> bars are when VIX spikes right >> when it spikes and it's spiking because the expectations are high or happened in the market which has skewed expectations around how much price will move in the future. So for example, Trump tweets 1,00% tariffs on China. Everybody now has to recalibrate what that means.

Expectations for what future price will do is going to spike. Volatility spikes. Equities tend to drop as people recalibrate, right? Or or they could pump, right? It it it just depends on what what's happening. But yes, it's just like expectations of how much this instrument is expected to move in the future. >> Um, >> okay. So, we've got, so I just want to stay on this for one second. So, we've got we've got obviously huge purple lines, you know, early 2020, right? Pro I'm assuming that's probably March 2020 when we had we had, you know, $90 ETH for a day or two. Yeah. >> And and then we've got a few over the years. We've got one big one that I'm assuming is is the tariffs in April.

>> The most recent one is a tariff tantrum in April. Yeah. And then the one before that is the yen carry trade unwind in that's right August. >> Will there be one for this for October eventually in this chart. >> So interestingly you don't see it on here because this happened after the market closed remember >> right. >> So if you scroll down to the next chart >> it has to be it has to be while the market's open for oh >> for normal VIX. So if you normalize it for zcores, right, as opposed to just a cuz you can't really just like look at VIX from 5 years ago and look at VIX from today and compare the absolute numbers because the what makes up the VIX are different options contracts and the option contracts that existed a year ago are not the same as the ones that

exist today. So a 70 VIX then is not equivalent to a 70 VIX today. So you have to kind of normalize, right? And so that's what this does. It normalizes for for standard deviation moves, right? And that's what this highlights. It's just an evolution of the previous chart. And you can see it it highlighted the October 10th sell-off. >> Got it. Okay. So, >> we did have a pretty big equity, you know, volat volatile day that day. >> Do you think we'll have another one? I don't know why I'm obviously hyperfixated on this week. Will we have another one for for for today or yesterday?

>> I don't think so. I don't I just I may I could rerun. >> Maybe the expect maybe the expectations are low already. The thing is, yeah, may maybe maybe they're already baked in. Um, you could you you very well could. I'm I'm not sure. I'll rerun it and I'll send it to you and you can share it with the audience to see if if it's there. It could. Um, and it it's not like a it's not a silver bullet. It's not like, oh, you see these bars and you just full port. Like, it's like you see these and then you try to take the greater puzzle picture that you put together that we just talked about with all those other shorter term risk signals and you're like, "Okay, we had a huge blowout, huge liquidation event. there's still some stressors overhead and we're still kind

of seeing how the market is digesting the liquidation event and and wealth destruction event of 1010. So, you know, it's an area to pay attention to for sure. It's just like how when do you like get into the market and that's where you start looking for potential strength relative to other things and stuff like that, which is what the chart kind of gets into. So, you're telling me then that these large like VIX bars are usually indicate that we're close to some local bottom? >> They have in the past. Historically, they've been decent decently good to >> good notifiers to get your attention ready, >> right? Because we have one here in what's this large one in 2024? Would that be a year ago or would that be

>> in mid 20? That's that's around the yen carry trade. >> That's the yen carry. Okay. Yeah. And then we've got two big ones for the tariffs this year and then we have one for October as well. Yeah. >> Right. Okay. And there's only one on this chart where the price of Bitcoin then went lower and that >> market which I believe that may have been the Luna collapse in >> that may have been I don't know if that timing looks right to you. I think it does. >> Okay. Okay. >> Maybe not. >> That looks that looks like it's late 2021 that this >> Yeah. No, you're right. It was some other It was just some other big >> 2021 liquidation cascade.

>> Yeah. >> I mean late 2021 is uh when they did the big pivot. >> Who pivoted? >> Oh yeah. Yeah. Yeah. That's when they start Yeah. Yes. Yes. That's when they started hiking. >> They had that meeting and it like killed the Santa rally and uh >> Right. >> Yeah. Yeah. Yeah. Yeah. Yeah. >> And again, so these these bars are the the like change the the opposite price or the opposite of the consumer expectation. So it's when something different happens than what people are expecting.

>> Yeah. Right. The best way that I can explain like a volatility increase is like if if it means if if it effectively reflects your current expectations for how price should fluctuate and then something big happens in the market, right? Obviously, your expectations need to adjust to reflect this new event such as the Fed raising interest rates for the first time in whatever and hiking them a shitload, right? Like causing that or Trump tweeting that and seeing 20 to30 billion dollars of of wealth evaporated, right? These have to reflect future expectations of how price should move because they are market they're significant market events. So that is effectively why you see the VIX spike it comes back down and then it just kind of

re you know finds its new equilibrium after the fact, >> right? Yeah. Okay, great. Okay, thank you for explaining that. >> That's like the way it's the way best way I can I I can think of articulating it. There's probably better ways but like it's good enough. >> Yeah. What else you got for us? Um, so yeah, the next couple charts, right, just kind of go through the mechanics of a liquidation cascade. We kind of talked about this a bunch. If you go to the next chart, it's probably a better one. Um, right. So, typically what happens is everybody gets nuked, which is what happened on 1010, >> right? And then price just kind of goes sideways and develops a new range because the majority of the time the market is is ranging. like 80% of the time it's just oscillating between two

price points determining you know developing an area of value and then occasionally it will impulse move up or impulse move down and then find a new level of value and that's what happens after liquidation cascades right so you get a nuke you go sideways for a couple days a couple weeks right typically consolidation is a function of how much money was liquidated so you know the bigger the more violent the liquidation the longer the consolidation after the Um and then ultimately the market will determine like okay like is are we going to return back to what value used to be or has this event actually moved the overall fair value of the market lower and then you just start to see the market bleed out which is kind of what started to happen over the last few

days. As you can see with this chart that I made over the weekend we were at like 106 as I I I like wrote here. If you go to the next slide, the title is the more time that BTC spends below value, the more likely further downside tests occur. So like we developed a nice period of value after the liquidation event from 106 to like 112 113. We stayed in that area for a couple weeks. um the a the anchored VWOP or the average um volume weighted average price of everybody who has bought since then since 10:10 is is that yellowish line that you can see which is about 108. And so you can see price has kind of like lost the low point of the range came back up tried to come back into the

value area it you know developed after 1010 and failed and now we're kind of bleeding out. So, it seems like the market is is still looking for a a price level that participants deem to actually be what fair value should be after 1010 because 1010 nuked most of the positions that that were live beforehand. So, now you want to focus on the positions that have happened after the fact to kind of gauge what these shorter term or medium-term fluctuations could look like. Uh Jason or even Satis because we haven't heard from you much. But would what how would we know that that has is occurring that the market is like like bidding on that bottom and holding it?

>> Well, you wouldn't have lost that 105 level, right? We we developed that range low for like two to three weeks, right? Like the x-axis is October 10th to November 5th or so. So, so from here would we are are you expecting us to range to in a similar time frame of like a we range for 3 four weeks and maybe we find this like 94K as a bottom or what would you expect from here? >> Yeah, I think like now you're firmly trading in an area that like the market spent a lot of time in for the last eight months, right? the market spent the m like the majority of 2025 and the end of 2024 from like 90 to 110.

And that's kind of where we're trading now, right? That was that was the range we broke down from during the tariff tantrums. It was the range we reclaimed after all of those trade deals were announced. And it's the range we've broken back down into. So, it just seems like we're just like oscillating at fair value, which could be anywhere from 95, 96, 97, 98. It could be as low as 94. It's probably somewhere in this range unless the macro environment completely just shits the bed and and deteriorates. So, I think like this area is probably where you'll start to see value build out more more so now. Yeah.

>> Okay. Got it. One big question I've seen um and again you have you have so much fantastic material here that that we kind of have to I think we kind of start to skip through it because we're only on slide 15 of 45. Um, one big question I I'd love to discuss. Um, and we had Fong Lee on from the from from uh, strategy. I thought it was still called Micro Strategy. I didn't know that until yesterday. Uh, from strategy on the show yesterday with John Gillan. a great interview, but one thing I've seen on the timeline people pointing at is that um and maybe you guys can help clarify this for us is that the strategy MNAV is now trading below the average price of their Bitcoin, which now means that they are no longer able to pay the interest on the loan that they got to buy the

Bitcoin. Is that relatively correct? Did I explain that properly >> or [clears throat] is that right? >> Um >> is that wrong? Maybe you can explain this. >> I mean the with the MNAV being below one, it means that they can't issue basically strategies strategy has been to sell has been to buy Bitcoin um for a dollar and sell it for $2 and then buy it for a dollar basically, right? And so this their their MNAB being above one basically gave them a the ability to issue shares to buy more Bitcoin than it was like netive, right?

Now they can't really do this. They can't really like do new equity raises and so they are doing a lot of these weird new like preferreds and these dividend paying things. A lot of a lot of strategies Bitcoin though is funded with equity. So like the actual price that Bitcoin would need to get to to like actually liquidate them is something super low. Uh it's like in the 10K range or something like that. I haven't done I haven't done the math recently on it, but a lot of it is equity, right? I think what is a bigger story here is just the dats overall.

>> You know, I think like strategy worked for a long time because it was the only one doing this >> and then everybody else saw what they were doing and this you you see this in crypto all the time. It's like you have DeFi summer early early days are good everybody's making money then it gets saturated the game gets figured out it's over, right? NFTs same thing. Memecoins same thing. most recently like I guess per farming and stuff, right? You always have this game that starts off well and then it kind of gets figured out and then it's over. And I think that all these other DATs coming to market kind of really kind of messed up Micro Strategy. And their continued bid to kind of run this trade because now there

were so many more instruments out there that people could start all these funds that were doing this volatility harvesting or whatever they were doing this all for. And then just the retail speculative capital, you know, all that money was now just not all going to strategy and it was kind of getting spread out with all these other ones. And all these new debts uh have been kind of a disaster at this point. I think Tom Le is maybe like okay relatively compared to the rest of them. It's still not good, but >> that's BMR right on this chart.

>> BMR, >> it's the blue line. >> This chart, what is this? Sorry. What is this? What are we looking at in this chart? This is their fully diluted M now. So what does that what does that mean? >> That is the value of all their their their shares outstanding plus like the warrants and everything they can issue divided by the value that they hold um of the treasury asset. Now the thing with fully diluted MNAV versus like uh circulating MNAV is that if you do if you think about this game just simply if you have a 1.5 MNAV fully diluted and circulating right and then when you issue shares you're buying

you're making that like 50 cents on the dollar right with these a lot of these new DAC codes that have come out a lot of this fully diluted number is like warrants that are going to be issued to people in the future that don't actually go towards like buying more treasury tokens. And so it's pretty bad in that respect that it doesn't this MNAV is not realizable versus like the circulating MNAV which is what they can actually issue shares at to the market. Um, so yeah, I I don't know. You kind of need to look at like both of them. Uh, because if the circulating is above one, then they can run this issuing you equity. But then if the circulating is below one and the fully diluted is over

one, then you're in this weird scenario where if they issue equity on the market they're actually losing uh tokens per share. But then in the future if some of these like investors or people with incentives on the board get these options and warrants then then the holders get diluted even further. So it's kind of like a double whammy of it being bad. I don't know where these are going to go from here. I think you're going to see massive consolidation. So you'll see I think you'll see both. You'll see within ecosystem. So you'll see ETH ones consolidate. Maybe BMR is the chosen one Tom Le and it starts acquiring these other ones. You also might see like vampire tax where one DAT will maybe go

buy the DAT of a different token and liquidate that token and use the money to then buy its DAT's token, right? Like you don't really know what's going on here. I think you could see some crazy stuff. I think these have been pretty disappointing overall compared to what people thought. I also think it's not surprising. It kind of feels like every cycle we get these things, but when it's happening, you're like, "This probably shouldn't work for too long." And everyone's like, "No, it's fine. This is that's like a mid IQ take and all this." And I think when a lot of people are saying something's midiq, like maybe it's not, right? Um, >> what do you mean midiq? What is mid IQ?

Like like mid as in >> midi? You're mid. Is that what you mean? They're like an average intelligence and so you're not smart enough to understand why this is actually >> uh a great trade or a great thing happening >> and you think it's it's there's like a meme the bell curve meme where you have like the left side the mid the mid curve and then the right side >> the crying guy >> and it's like the right and the left are kind of in agreement on stuff but they come to it from different areas >> but >> okay >> yeah this thing is like a kind of an overhang because you also have a lot of lawsuits that might be coming out with these two, right?

>> Um there's a lot of factors with these dats. I >> I'm just very You've seen some of these dats like Ezilla started selling some of their ETH to try and buy back their shares below and I don't think that really helped at all. And so it's like what do you what do these things do now, right? I think it'll be interesting. >> Okay. So you're you're you're painting a picture that the the the DAT situation is not great currently in the market. And that's and I think that's fair. I think it's it's good to kind of have that that honest take. Um I don't want to take up too much more time looking at these charts. I'd rather kind of maybe look ahead, guys. Um and we can kind of use the last bit of the episode to do that. And I think that's what a lot of

us are kind of looking for at a point like this. Um Sataras, you know, you're talking about left curve and right and right curve takes and mid-curve takes. What what is something right now that the left curves and right curves might be agreeing on for the future for the next 6 months of crypto uh that the mids are in denial of? >> Oo, it's a great question. >> This is so hard because my answer is like could honestly be midcurve, [laughter] but like maybe privacy, you know, like this thing might have legs. I >> you can go look at those privacy charts at the end. I think they're like the last three or four charts. It's like it's >> you're talking like the privacy meta of like Zcash.

>> There are a lot of smart I mean speaking of Zcash specifically like I listen I had a tweet on October 1st where I was like I'm not buying Zcash and I knew when I tweeted that I was probably going to regret that tweet and like it privacy has always made sense. It's never really got a bid. There's always been this bad regulatory kind of overhang over it. Zcash, you know, went through this very long bare market with just minor rewards, you know, 20% of the supply going to uh development team and everything and then just totally coming out of favor, right? But you do have a lot of smart people behind it. Um, you have a lot of new faces there, right?

And it's just a very and the tech is legitimately very good. It is like pioneering privacy. It originally was supposed to be in Bitcoin. Bitcoin core rejected it. So that's why they made the separate coin after um and it's it's so you have a lot of smart people that are working on it. a lot of the gigab brains in crypto and then it's very simple from a narrative perspective for the left curve where it's like you know private private money right like it's very simple it's a very simple thesis and I think a lot of the critiques against Zcash over the years were that privacy is not a product it's a feature right so a privacy coin in itself is not going to work uh because people would rather just like be

able to have their Salana address totally private right I think that's that's always been a pretty good argument But there's also a case to be made that like people like simple people are passive holders by nature. They like easy things to get behind. They like clean plays on certain sectors or like narratives. And the thing is when if Zcash actually keeps going up, it's already the largest shielded pool in the world now. It's bigger than tornado cash. And so you kind of start to get these economies of scale there where if everybody does actually start to use this as their preferred privacy pool in a sense, then it kind of can like accelerate because now it just keeps getting bigger and bigger and it becomes harder and harder for other, you know, privacy to catch up. So I I like I'm not

going to make any hard predictions about Zcash. I just think that there's upside risk, right? I mean >> um it's like it's in a very interesting spot. I don't think it's like I don't think it this is not like a cabal thing and just like some [ __ ] narrative that came around. Um there is like stuff real here where will it actually hit some of these targets people are coming up with like I don't know but there is there is a scenario where it does actually work from here. >> But why is it why is it counter trading to the market and this that like that's a rosy that's a you know that's a great bullcase for it. Why did this start almost exactly at the time all the couple weeks before these these cascades on October 10th and and the chops since then? Why is this why is this had been

the best trade you could have made in crypto in the last 6 weeks? >> Timing might just be a bit of a coincidence and also when it's coming off such a low price it is pretty easy to move it. >> Yeah, it's not a super liquid token. It doesn't like trade on many of the main venues. It doesn't really have per liquid places, right? So, um, Cedus and I have talked about this quite a bit on like our internal calls. It trades more or like maybe it'll change now as it's getting bigger and relisted places. Um, but at least like for most of the last month, it trades a lot like um like a pure onchain coin would trade one that doesn't have tons of per shorts, right?

It doesn't have a lot of leverage built up in it, right? like it kind of trades purely from like pure in that sense versus a lot of like the majors which have you know which are dominated by per markets relative to spot markets right so like to set's point like it's off a low price it's been distributed like supply for years and years right like you know it you just have a couple big players start taking positions and then you know in a market that doesn't have a lot of things running everybody's like oh [ __ ] this coin's up bunch of good Kos shilling it there's actually, you know, a decent narrative. Like it it it makes it like in a market that's as [ __ ] as it has been, pardon my French for the last month, right? Like it kind of makes the

decision for you. It's like, okay, like I can keep trying to buy the range low retest for the seventh time on my favorite altcoin or ETH or whatever. Or I could just buy the coin that's going up every day, right? like it kind of makes the decision for you in that respect for a lot of other people who are momentum traders, which is a big part of crypto. So, it's got like it's a it's a perfect little storm for Zcash to for the last month. Why do people invest in real estate? Because it spits off cash flow. But I'm not here to manage rental properties. That's why I'm looking at Figure Markets. Their new democratized prime product backs your money with real cash flowing assets and

returns up to 9% APY. It's the first real world asset borrow lend pool built for everyone, not just institutions. Ready to lend like a bank and get more than the 5% A is offering you. Download the Figure Markets app today and get 9% on your idol funds. Go to milkroad.com/figuremarkets. >> Thanks for explaining that. Yeah, that makes sense. I think a lot of us have may may have been a little blind to this trade uh as our as our main portfolios bled. Uh which is which is okay. Can't make every trade club. Don't worry about it.

>> What is um okay let's to wrap this out. Let's let's look back to the majors guys. What um what is the midcurve take for the next six months? I mean, the more and more market absolutely uh bleeds, right? Like every like it seems like everybody was super bullish Q4 and we've just gotten slaughtered Q4, at least in crypto, right? Equities are pretty flat for the most part. I mean, outside of the I guess the majors in equities, a lot of them have kind of gotten smoked, too. Um, >> so it turns out bullish Q4 was the midtake that we all had. >> Seems to be, right? Like it seemed like liquidity conditions were lining up and then they just hit us with a month-long shutdown or whatever, delayed everything, right? And then Powell hit us.

>> And just just to clarify, when we're saying midtake, just to kind of summarize our little pop culture reference here, midtake is something that the majority of people are saying >> and it's not going to happen. >> It's such a popular take and it's and it's silly. Whereas the um lowest IQ people in the room and the highest IQ people in the room, which are the minority, have an opposite take typically. So, I'm asking you guys now, what is the, you know, obviously we all, we're all mid-curve being saying Q4 is going to be the most bullish ever.

>> Clearly, we're halfway through Q4. We've been wrong. Uh, so it turns out we're the mids. What from here is the mid-curve take at this point in time now that that mid-curve take is done? I think if you're expect I'm curious what Cedus thinks. It could be like a crypto thing for me. Like I think I think if you're betting on like a lot more downside now, right? like we're down from 125 or 6 to 95 or whatever we are um at the at the time of recording. Like I think if you're betting on like a full breakdown now, like you're probably the mid the midcurve, right? Like I think the smart people who who weren't mid-curving and were quick to the the change with the

shutdown and liquidity, right, and shorting Bitcoin and and hedging or whatever, right? Like I don't think they're opening more shorts now. I think they're probably thinking about closing a lot of their hedges or closing a lot of their shorts uh into the mid and low 90s, right? Like I think this is probably like the best case scenario if you were shorting over the last month or two. Like you just pretty much got straight down. No bounce, just straight down, right? Like that's perfect. It's like it it couldn't have worked any better for you, right? So like if you're a somebody who was smart enough to be ahead of the curve or fast enough to switch your bias and and catch it, right? like and you haven't already closed like what could you possibly be expecting that would send this back down into the like 80s or something right

like what you going to risk retracing the whole move to capture another 2 3k downside on Bitcoin seems seems you know mid to be getting bearish now >> I um I here's my take is that I don't know if there is a mid-curve take right now because there are there we've probably never had such a diverse set of opinions than right now of where things are going to go. And I don't know, it's it's I think the like the worst answer, which is my like everybody hates like the oh short, medium-term, I don't know, but long term, I'm bullish, right? Everybody hates that answer.

>> Good answer. >> But I mean, realistically, I think there's a lot of maturity the industry has gone through. What I think is here to stay is this consolidation for sure. I think tokens that give you like actual ownership in the underlying business, actually have revenues, actually make money will continue to do well, and you'll have the these like narrative very specific narrative specific stuff that are like strong long-term narratives. And everything else I don't think is really going to it's going to stay in like this weird zone, right, of probably just grinds down.

It's just going to probably like just keep grinding down. I mean, there are so many tokens now. And a lot of these are not even into like their unlocks yet. And I mean, I don't want to pick on specific projects, but there's a lot of like chains that have launched in the last year or two that are barely even like unlocked and they don't really have a lot of users, right? So, you're really going to see these power laws. I don't think we're going to get, you know, one of these 2022 type things because I don't think the macro is going to be that bad. What is the one factor that could reverse the negative sentiment that is coming? I think for a long time we were like government shutdown ends. We're back and we were back for like two days and then we were

not from here. And it can be tomorrow, it can be in a month, it can be whenever you guys think. What is the one thing that would reverse us to the to the upside at least sentiment-wise and maybe price-wise? >> How likely does this thing have to be? >> It can Hey, listen. We've seen things send us to the downside that came out of nowhere, like the China tariff. So, it it can be anything. >> Sure. Yeah. Trump announces some delta neutral buying of Bitcoin for the SBR would send Bitcoin to 130 in a candle at this point given how how bad sentiment is, how much positioning has been wiped out, how many people are bearish, right? Like an announcement like right like the market is clearly not even pricing an SPR at

this point ever, right? It's just like all right, whatever. That that was obviously just like a a show thing. But if they do come out with something, you know, maybe as part of like a I don't know, some scheme to juice the markets into the midterms to, you know, get a better turnout of voters for for those, you know, a year from today or whatever. It's about a year from today, right? So like I don't know. I've seen crazier stuff happen happen but like yeah the one thing that would send back to the highs something of that magnitude because very clearly these smaller smaller things aren't um right it's kind of that old adage of or cliche of like when the market's not reacting to to

news and the like good or bad news to the way in which you would expect it to it's like not a good sign usually >> also like sometimes in bull markets. Speaking equity specifically, you just get pretty bad sell-offs that last like a month or two and then things just kind of like go back and sometimes there's not a pure right like reason besides there was just too much kind of exuberance for a bit and everything needed to reset. And crypto it's always a lot more painful because it is the furthest out on that risk curve and that's the first place that kind of gets hit. But if you do see stocks, you know, start to like settle out and then just start grinding back up again, then you should probably just see liquidity come back into crypto and then people can it's reflexive, right? Like people can

start getting all bulled up on like rates are still coming down, TGA, all this stuff pretty quickly again, right? Yeah. Like for for a single shock event, it would have to be something Trump does with like stmmies and uh some like helicopter money stuff and >> talk about the stimmies. We didn't even talk about the stimmies, boys. I think we'll save that for the next episode. >> Maybe they're What are you What are you buying with your STEMI? >> I I I can't I don't I don't get a STEMI. I don't have a STEM, man. I'm in the wrong country. >> Oh, true. We talked about >> Mark Carney is not sending me 2,000 Canadian dollars anytime soon. He's building new pipelines. So, we we got to completely >> He's asking you for $2,000.

>> He's asking Yeah, he's asking me for $2,000 and promises he'll he'll he'll build new pipelines with it. So, uh I don't I don't know how I feel about that, but it's too late now. >> Pip bank account. [laughter] >> All right, gentlemen. Jason Saras from Deli. Guys, thank you for your time. I think we'll have you guys back hopefully sometime very soon to talk uh maybe 2026 outlook, which we're going to be doing a lot of next month. Um, thank you for joining and for anybody still listening, uh, if you like this kind of stuff, um, keep listening to Milk Road. We've got Milk Road AI going. We have a Milk Road Pro as well, uh, for anybody who wants access to all our our analysts who are breaking this down, telling you that why things are still looking pretty rosy for next year, putting out fantastic pro

reports. So, make sure you guys check that out. Jason Sataras, thank you for coming on the show, and we'll see you guys next time on Milk Road. >> If y'all are making swaps or trades right now, highly recommend you check out Milkroad Swap. This is a deck that we built in partnership with Cow Protocol. Why did we build it? Not to make money, just honestly so we could have a place to do our swaps for the lowest fees that we could find. This is the fees on Ethereum, Arbitum, and BAS are only.15% fees. Uh this is a huge difference from uh other centralized exchanges that charge half a percent or even up to 1.2% fees on their swaps. Also, you can swap on Salana all at swap.mmilkroad.com.

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