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Altseason Predictions, Crypto Cycle Breakdown & VirtualBacon’s Top 4 Tokens for the Next Big Run

Milk Road36:01

Transcription

GM, good morning. Welcome to the Milk Road Show, the daily crypto show for people trying to turn internet tokens into beachfront property. I'm your host, Jay Hamilton. It's Wednesday, August the 6th, and today we're joined by the one and only Virtual Bacon, a crypto angel, investor, educator, developer, and fellow YouTuber.

We're going to talk about where he sees us in the cycle right now. Look at Bitcoin dominance. Look at altcoins. We just had a great mini altcoin season. Is this it? Is this the top, or have we still got a lot longer to go? We're going to dive into that. We're also going to get his takes on his highest conviction tokens right now, where he sees edge, where he sees alpha that you could take advantage of in your portfolio.

And finally, we're going to touch on the SEC's Project Crypto. We talked about this in yesterday's episode, but I just feel like no one is grasping the magnitude of this announcement and of where this Project Crypto is going to go. So, we're going to dive into why we believe this is such a big milestone and where the impact will be short-term, medium-term, and long-term.

Before we jump in, if you guys are making swaps, which I know you are, highly recommend you check out Milk Road Swap. Not only because it's our own product, which I believe is a great product, but more so because it's got some of the lowest fees you can find. Only 15 bips. That's 0.15% fees on trades on Ethereum, Arbitrum, and Base. And you can also trade on Solana. So go to swap.milkroad.com today.

Today's episode is brought to you by Nexo, the platform that grows your crypto without locking it away. It's also brought to you by Figure Markets. Grow your cash like a bank. No lockups, just real returns.

Without further ado, Virtual Bacon, welcome to the Milk Road Show.

Thanks for having me, man. It's been a long time coming.

Yeah. Oh, I love to hear that. Love to hear that. Hopefully, this is the first of many. Uh, okay. Let's start with, you know, you are super active in the markets. So, probably nobody better to ask this question to. Where, where are we right now in this cycle? And how are you looking at this? Because what I'm seeing, and I'm sure you're seeing this too, is we've got this little, we had a great rip through July, right? Everything was green and now we got this little pause and things are, you know, down. Some things are down some. We're we're just kind of a bit range-bound right now. But you get that instant freakout, right? You have a day where it's like your token's down 5%, 10%, maybe 15%. And I'm not saying we're not in a massive pullback or anything like that, but you start to get a lot of talk of, you know, is this a top? Where, where are we? What's next? Right? So, how do you frame it? What's your view right now?

So, the way I see it, um, this cycle is especially different when it comes to separation between Bitcoin and altcoins. When you look at Bitcoin, it's totally clear. It's just trending up. Every few months we have a chop, but it doesn't get into sustained bull, uh, sustained bear. It's just slow bull. But for alts, it's especially different compared to the last two cycles since alts have been a thing that it's just very delayed. I'm in the camp that I believe we still have this altcoin season coming up. Um, more so like an altcoin year, which lasts multiple months, unlike the few blips that we've had. But it just hasn't happened and people are feeling this now. As we look back at the four-year cycle, we are very late in the altcoin cycle. Uh, typically, you know, that first year past the halving event, altcoins should already be running faster than Bitcoin, but we haven't been there yet and it's already been almost a year and a half since the last halving. So, yeah, I think, um, Bitcoin definitely still has more upside. Altcoins, you just have to be patient. You wait for the signals to actually fire for Bitcoin dominance and then you take a more meaningful size of your chunk of your portfolio into alts.

Okay. So, let's look at, you, Bitcoin dominance. Let's take a look at that. Uh, because you brought that up and that is a key signal. Where are we at? What are you seeing here?

So, basically, you know, just to put the time frames on the charts, we have, um, I believe at the Bitcoin halving. Yeah, these are Bitcoin halving events. Usually, you see that for my sake, I usually look at, uh, trends. So to confirm a trend on Bitcoin dominance of a downtrend, that's altcoin season. So a downtrend will be lower highs and lower lows. So then you look at, okay, 2017, Bitcoin dominance technically confirmed the downtrend right around here when you had the first low and then first high, but it didn't bounce back all the way up. So that was around like 350 days past the halving. And then you have like '27, uh, 2021 again, pretty similar. So you have this like COVID blip and then by around this period, this was clearly altcoin season already. That was around 350 days again, 335 days. But then this cycle, it just hasn't happened. So we are already, what is this, 450, 460 days past the halving and we haven't had a weekly lower high and lower low. So this is so far just macro uptrend. That's why I think it will happen, but we need to wait, right? We need to wait for this kind of a thing to happen. We need to have a confirmed downtrend and at least take out this like 50-week SMA that we bounced from here when Trump won the election, and then we can talk seriously. Okay, are we going to have a six to 12 month long altcoin season? So, just a bit more patience. Altcoins are cheap, but if you are trying to front-run this a little bit too aggressively, it has not been good, uh, because this thing keeps running up until we get a confirmed downtrend. So patience is the key, which is never easy for investors, particularly crypto investors, uh, all of us who, uh, lack patience and just desire 10, 100x constantly. And crypto Twitter doesn't help when everyone only talks about their wins and doesn't talk about their losses enough. Uh, when, when you, will we get an altcoin season? Let, let me ask you that. Will we get an altcoin season, and will it be like past altcoin seasons?

So, okay, um, I'll answer the second question first, which is, will it be like the past altcoin seasons? That I'm not sure because the, there's a big difference depending on who you ask. Some altcoin season indicators actually take it literally and say, do we have one season where altcoins outperform Bitcoin? In other words, three months. And that's pretty doable. Let's say, you know, Bitcoin runs from here to 150k, markets are going to be pretty euphoric, and we can have like one quarter. But if we talk about seriously, 2017 or 2021 altcoin performance, those lasted about a year where altcoins did well. And that timeline, I don't know if we can get that long anymore. Let's say even if we start today, we're looking at 2026, you know, Q4 2026. If we get that, I mean, that truly will be a super cycle and super rally. And we need Bitcoin to have sustained euphoria for over a year. And I'm not sure if we can get that long. Um, I'm leaning more in the camp of three to six months of a very fast, um, relatively shorter altcoin half-year, so to speak. Uh, but technically, yeah, that's still altcoin season. Doesn't have the same ring. Altcoin half doesn't have the same ring as altcoin year. Just feels good.

But, but I think the, the overall point that you're making, and I completely agree with this. I don't think we have the, the, the timeline to run a full year anymore. Uh, but also the main point I always want to make sure that our listeners understand is like, when altcoins run, they run fast. Look at what just happened in the past month. We had a mini altcoin season, right? Like, and I, I get that like your definition of season might, we had an altcoin month, let's call it that, right? Where yeah, there was altcoins massively outperforming Bitcoin, many of them, right? From, from the biggest in in terms of Ethereum all the way down the stack. The only thing that I can't figure out is, will we, as, as the crypto market matures, as we have more institutions present, as we have different buyers than we had in the past, will we get the same altcoin season where you throw a dart at the board, any altcoin is going to rip, or will it only be certain sectors of crypto? Because the thing we all have to remember is we have millions upon millions of tokens now. We did not have that in past cycles.

So I think there are, um, two differences between this cycle versus last. First being what you said, it's so easy to make tokens now. Even from 2020, 2021, there were only like less than 10,000 total coins and mostly it had to be like centralized exchange. But since, you know, ICOs and since IDOs and DEXs have become so popular, it's very hard. And especially for the newer coins, like if you don't catch the right timing to launch your coin right into altcoin season and let's say altcoin months phase for one month away, your new coins already be replaced by the new meme coins. So that's just how the current market is different. Uh, so yeah, I agree. Especially for newer things, low caps, um, it would be hard to throw a dart randomly and just say, "Okay, everything's going up the same percentage." I think the large caps, the ones that have established themselves not only in time, in persistence, in market cap, but also in kind of regulatory how they're how they've been treated. The ones that have institutional ETFs, like those take much longer, and I think they will really start to separate themselves from the rest of things that can just be easily created.

Interesting. Uh, I want to get into your, your high conviction tokens and I'll be curious whether you're going low cap or high cap based upon that comment. Uh, but first, let's just take a look at, you had a couple other charts that you wanted to show around signals for altcoin season. Let's take a look at those.

Yeah. So, just to maybe hammer on the point of how quick things can run. So you see this like green, uh, part. This is actually based on the, the Bitcoin cycles. So usually compared to last, um, four-year halvings, so to speak, the last bit of run-up for Bitcoin is the most explosive, where you have Bitcoin essentially exploding from, you know, these euphoria periods towards the blow-off top, and that's really when altcoins start to run. So I think a couple scenarios, either we have a, just by the end of this year, by the four-year cycle standard, that Bitcoin just straight up rips to like 200k. If we go by the power law that has a Bitcoin has followed for the last four cycles, then this kind of a scenario would bring us like immediate altcoin season, where just think of the euphoria, right? But if it doesn't happen that way, then it could be that Bitcoin continues to chop slowly. And then that's when we need more patience for altcoins. So, yeah, so that's something I, I've been really contemplating a lot about. Do I think we will top by the end of this year in a very sharp euphoria, or are we looking at next year? And if we are looking at next year, then we got to look at other indicators. For example, like global liquidity is slowly trending up, but it hasn't been there yet. Uh, and global liquidity really has been dominating, um, in terms of how Bitcoin dominance performs. So we need global liquidity to sustainably trend up, like jump in quickly and say that, uh, we had Michael Howell on the podcast yesterday. So if anybody wants an update on global liquidity, go back and listen to that episode because he did an incredible job breaking down where we are and where we're going.

For sure. Yeah. I, I, I honestly Google his, his stuff and I, um, I follow his Substack every single week for the updates. Yeah, it's the best. Yeah, but I think it's way more about a liquidity cycle. So, I lean on the camp of this. Okay. So, so yeah. So, where I, I'm, I'm leaning into the camp that we go into next year. I don't think it's just this year.

That's what you're saying, too. You think we...

Exactly. So for the people that are already starting to feel like they're going to miss the immediate gain, there's a chance for that to happen, but the main catalyst there would be Bitcoin going up way faster than it has for the past couple years and actually giving us a blow-off top in this like four-year cycle style. And look at this green part. It's, we're talking about like by Q end of this year, Bitcoin needs to go to 200k. If that happens, then yeah, global liquidity doesn't matter as much anymore. The liquidity doesn't move that quickly. Um, instead, people just have so much more money from Bitcoin and they just ape alts like last cycles. But if Bitcoin runs more slowly into next year, then the four-year cycle theory is kind of over, and then we need to look at liquidity.

Okay. So, as we prep for the coming altcoin season, we don't know when it's going to come, guys. Pay attention to the, to Bitcoin dominance, to some of these stats and signals that, uh, Dennis has been taking us through today. But big question here is, where is the edge? Where's the alpha? When we get there, where's the opportunity? What tokens, what narratives do you like?

So I think this is again the institution cycle, the US regulator cycle, the Wall Street cycle. So what do they like? They like tokenization. They like stablecoins. Look at the bills that they have passed, right? Look at what the SEC is saying that they favor. I think also look at what Trump is doing with his family, with his, um, family office, with the deals that he's been making. I really like stablecoins, stablecoin issuers. I like the, uh, clarity around DeFi this year and DeFi super apps, especially from Project Crypto, we'll talk about in a bit. So I think all that will surround a couple things. Um, World Liberty, what the Trump family office is directly launching. Um, I think so in that umbrella brand, they have their stablecoin issuer. They have, um, DeFi super app allowing people to lend, borrow, swap, bridge across chains all in one. I think that's, these are super slept on right now. So yeah, I think that's going to be the, the next big narrative.

So are you, what's the, what tokens are, are the opportunities within that? Uh, first of all, even right now, I think World Liberty pre-market, you know, trading at, right, because it hasn't TGE'd yet, right? It hasn't yet, but, um, from their official, you know, governance proposal things, they did say it's going to be six to eight weeks away from about two weeks ago. Okay. So, it would be like one and a half months to go, pretty soon. And I think this is a hundred billion dollar coin FTV. Just look at the Trump meme. Yeah, I think so. Um, yeah, I guess you're right. The Trump meme's a good point. Trump meme was 73 billion and this is, and it was like one, one tweet from the president and again, this is before he came into office. Like imagine, um, now and also they have this real utility coin, they have actual ways to bring liquidity, to bring, they have a reason to do this because it's backed by US treasuries. It's the biggest reason, biggest problem for the US government. So there's no reason for them to not do this. Yeah. Uh, it's just another vehicle for them to make deals to help fund their, fund their treasuries. So yeah, I think it's 100 billion, barely bigger than the Trump meme peak.

So, for, for our listeners, is the, is the, what's the opportunity for them? Is there a pre-TGE opportunity or is it wait for TGE and buy early?

So, I, I covered this a little bit. If you want to take part in pre-market, the best place is probably Wales Market. It's a self-custodial DeFi platform. People trade against each other, you know, put down their collateral. The thing is, um, on there, this coin is trading at around 20 billion FTV right now. And the way it works is, you, let's say you put $100 of collateral, you buy someone else's TGE tokens, they can choose to not send you the tokens and instead just give up their collateral. So you might end up only making 2x if the coin goes up higher than 2x from current PTGE price. Yeah, there's something there. Um, I'm looking at some of the projects that are confirmed to be working with World Liberty, powering some of their things, founded by World Liberty Advisors, for example.

Okay. Yeah. Tell us more about those.

Yeah. So I've, um, I have a couple. So there's one called Block Street. This is one that's founded by a, um, core advisor to World Liberty. Um, they are basically the main launchpad for USD1, so bringing USD1 across all the EVM chains and launching projects to pair their LP with USD1. And yeah, they have a lot of deal flow, access to World Liberty because of that advisory relationship.

Do they have a token?

Yeah, they have a, it's just called Block Street. Block is the token. Okay. Yeah, a lot of people have been talking about this, especially like every time World Liberty has a governance proposal thing, people, you know, use this as kind of the main beta. Okay. Um, there's 100, 100 million, uh, market, small token. Yeah. 220 FTV. Not, not too bad, like not, um, not super cap. Yeah. Not, yeah. Yeah. And then there is Dolomite. This is a lending borrowing platform that, um, the creator of Dolomite, Corey Kaplan, he's actually the CTO of World Liberty. So yeah, you don't have to, you know, connect the dots anymore. It basically just, yeah. So, um, it's pretty clear. Uh, and the World Liberty, the multisig has interacted with Dolomite doing, um, on-chain like protocol just lending borrowing, even though they haven't announced anything. So, um, those are all public things you can directly find. So yeah, um, I have these two coins as the main, as the main betas, and they're roughly both around 100 million market cap, so not, not too bad.

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Okay. Uh, I want to go back to stablecoins. Everybody likes stablecoins. Everybody gets it, right? And everybody knows it's early. You know, we've got, we got a long way to do. We're going to have trillions in stablecoins. I don't think there's any debate there. The timeline you can debate, right? How quickly that'll happen. Obviously, with all the regulation coming, I think we could see an expedite of that process. Which tokens do you like for stablecoins, or do you like Circle on the public equity side?

Um, so barring WFI, which is basically based on the potential of their USD1 market cap, I think, uh, you got to look at the, what Tether is doing. So Tether is still going to have huge dominance. Tether, 160 billion, Circle, USDC is 65, right? You have Ethereum, etc. So there's the gap between Tether, USDC, and the rest are huge. It's very hard for these DeFi native ones to close. I think the only exception will be World Liberty because they do deals directly with the government. Um, but Tether has a couple chains that they're launching that they are like semi-backing. There's Plasma, you probably have heard of their ICO. There's Stable, stable.xyz. Uh, both of these specifically work for Tether in the sense that you don't need gas. You use Tether as gas, and they are apparently like super fast, meant for Tether trading. Um, and you can look at Tron.

So after the Genesis Act?

Yeah. Yeah. After the Genesis Act was passed, technically the offshore parts of Tether are no longer allowed, like regulated. But Tron themselves have, uh, worked even more with Tether. They they've been minting a lot more, and Tether have said that they want to bring a lot more of the offshore parts onshore into the US again and issue like another version, another like subsidiary, something. So, I think there's something there. Either it's one of these Tether-backed chains that's close relationship with Tron that they're going to migrate some of that TRC20 stuff over, or maybe it's like a joint venture or something. But something will come out of this in a kind of DeFi format. Whatever Tether has the biggest push in, because Tether doesn't plan to go IPO. That's what they've said. Um, so I, I think there's opportunity there. Circle. Yeah, pretty safe bet, but it's pretty big already. So, um, yeah, I, I'm not a big fan of the other ones, MakerDAO or Athena.

Yeah, interesting. Why not?

It's just, um, it's very hard for them to move up in supply in market cap, like going from Athena's 10 billion USD to 60. You got to look at their core business model. Like they're DeFi driven, they're yield driven. And yeah, their yield arbitrage is high, but there's only a certain appetite for how many billions are willing to pour into like arbitrage strategy for basis for funding trade on Ethena. And for Maker's case, it's, I mean, it's half decentralized USDC. So yeah, you might as well just be in Circle. Um, yeah, so I, I will look big and look at what Tether is bringing up next.

Okay. Okay. So you like World Liberty and the, the ecosystem around that, the partners within that, and then Tether and the beta plays for Tether would be Tron, maybe some of the new projects that Tether is partnering with, uh, that you mentioned. Uh, okay. Any other, I want to talk about Project Crypto and the impact of that, but is there any other high conviction tokens before we move on to Project Crypto?

Yeah, I like this coin called DeFi App. It's very closely related to Project Crypto just because they're really introducing just friendly regulation for all-in-one custody solutions that handles trading, handles lending, borrowing, on-off ramping, you know, no gas, but in a DeFi sense, not in a centralized exchange sense. This is one of the, the main ones I've been using and tracking.

So, okay, just something to highlight. What's the token for DeFi App? What's the, uh...

It's called HOME. H O M E. Yeah.

Okay. Okay. And what's it trading at right now?

About 100 million. Very consistent in your market cap. Not too low, not too high, just in that, in that range.

Okay. Okay. Uh, let's use that as a, as a jumping off point into Project Crypto.

Yeah. So, let me ask, let me ask the question here, which is, why is Project Crypto such a big deal?

I think it's a, just total shift and what made the SEC take this complete 180. It's a real 180. And this has been like eight years in the making. Ever since ICOs were a thing, they never were positive ICOs. I've been in crypto since 2017, like ICO days. It has always been kind of an uphill battle. Even when it was gray area, they never technically said, "Oh, you can just, um, issue some, use this funding mechanism, and then you can, we, we want to support you in your innovation in an official sense." But now they do. So, Project Crypto, uh, for those that haven't caught up, is, uh, this recent speech and industry agency-wide initiative that they want to pass multiple bills to help crypto in the SEC. So, a few different, I, I want to say three different areas that it helps. First of all, we talked about ICOs. So they said, um, you can do ICOs, basically you can do airdrops, you can do token distribution, and they don't want to cut out, uh, both participants in the US and projects in the US. So if you're a participant in the US, you don't have to KYC, do I VPN, IP blocking, none of that anymore. And for projects, you can totally have a US entity and issue ICOs, issue airdrops. There will be clear guidelines for you to do so, and there is no longer like these like weird regulationd, you know, one-year cliff type of things you have to go through and potentially fear that, um, the SEC is going to come after you. So that's the first major one for ICOs, like we're all going to have public sale opportunities that we can just, uh, easily participate in.

Thank the Lord. About time, right? Yeah. Okay. Okay. What's the second one?

Second would be the, uh, super app. So they have this, what is this called, facilitating super apps horizontal integration product offerings. So this benefits both exchanges and something like the DeFi App that I talked about, which is just all-in-one apps. Um, so if you're a trader in the US, it's super complicated, right? You have to look at all the different exchanges. Okay, you want to do some spot, you can use Coinbase, Crypto.com. But if you want to do PERPS, you then have to transfer those to somewhere else. And then maybe those will block you in six months, and then you have to use another one. And then if you want to do IDO, you have to transfer to another exchange because the SEC historically has had one license for each exchange in every state. And then if you want to do lending borrowing, it's another license. For ICOs, it's not allowed. For perps, not allowed. It's like 100 different licenses. So now they want to do this all-in-one license for super apps where like Binance, for example, they want to come in, you can offer perps, you can offer spot, you can offer ICOs, you can offer lending borrowing, all allowed, uh, all-in-one streamlined, so everyone can just actually use the best platform with the most liquidity and make it very easy. So super good.

Okay. And what's the third?

Uh, the third would be DeFi. Yeah, DeFi custody. Just really doing things on-chain. Unleashing US markets on-chain in here. It's pretty crazy. They actually mentioned automated market makers specifically. So this is Uniswap. This is, uh, the swaps. This is Jupiter, Radium, you know, anything that has to do with AMMs. You swap tokens on-chain. They want to make these things fully self-custodial and they want to classify as not a money broker. So all of this, these, um, three paragraphs is to say that they recognize a smart contract-based exchange as not an intermediary, and they don't want to force them to have to register as a money broker when literally it's all just decentralized. It's people trading against each other. There's no middleman. So they want to fully allow that, and they want to change the rules in the upcoming bills to make it that, uh, all these systems can fully function in the US and, uh, if they want to have some sort of governance, some fee sharing, whatever, that will be able to be introduced as well.

When do you think, uh, the impact of something like Project Crypto, which as you said, really right now, it's a speech and a, a report, you know, a document that explains what they want to do, what they want to try to do, when is the impact of something like this get felt in the market?

That's interesting. So I think the exchanges side, the super apps, is already getting felt. We have some exchanges moving back into the US, right? On the day of this, um, Gate, I believe, has reopened their Gate US. So they, they were pre-planning this. I think all the US subsidiaries will open up soon. Uh, Coinbase has their perps soon in the US, uh, very soon. You can trade Bitcoin, ETH on leverage on Coinbase for US, which this has been banned since forever. So the exchange side is opening up very soon, like even this month. The DeFi side, it's technically pretty okay. I think this is pretty easy as well. Uh, it's just a matter of them saying, "Okay, we're not going to go after you." And then the DeFi stuff can just, they can turn on the featuring and they can have their tokens, uh, whatever they want to do. Um, when it comes to the, the ICO stuff, I haven't seen it yet. Uh, that one I'm not so sure. I'm still monitoring. I think it'll take some big scale raises first. If we see, you know, crypto Twitter, all of a sudden we see like a few different projects opt to do ICOs instead of like $20 million seed rounds from VCs, then we can all have a very good time. I haven't seen that yet. I think that's, it's probably the most, um, iffy one if we're going to get that immediately or not. That's what I'm looking for for all of us to have a very good time. And I know you guys listen in are looking for that, too. So, uh, you know, it's coming. It's coming. And it's coming with a little bit of sizzled bacon on top because everybody loves the, the good bacon. That's for sure.

Uh, before we let you go, Virtual Bacon, I want to, uh, make sure that we give our audience a chance to go follow you. So, if you're not following Virtual Bacon on X, make sure you do so. Virtual Bacon0eroX. And he's got tons of great content and lots of great alpha. So check them out. Thanks so much for joining us today. I think we got to get you back when World Liberty does TGE. That feels like a good time to get you back to maybe either just before to talk about if you think it's a good TGE, or just after to talk about expectations and how it goes. What do you think?

Of course. Yeah, I'm super excited and my bags are packed. Let's see how it plays out. Very curious.

All right, I love it. Thanks again for joining us today.

Thank you for having me.

Thanks for listening, y'all. I got to remind you as always that none of today's episode is financial advice. I'm not your financial advisor. Virtual Bacon is not your financial advisor. If you need help with your investments, you should speak to a professional. This episode is for education and informational purposes only. And if you are making swaps, as I said at the beginning, check out Milk Road Swap at swap.milkroad.com for some of the cheapest fees in the space. Have a great day, y'all. We'll see you back again tomorrow.

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