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Dear AbNormals,
This will be the last post of 2021, what a year it has been. We’ve been through a lot together, the ebbs and flows of the market and all the emotions. I hope you are all doing well and let’s make 2022 our best year!
I started creating YouTube video’s (In Dutch) mainly focused on the usage of crypto’s such as BTC, ETH, Stablecoins. To give you a glimpse of what’s possible out there. It’s not much yet, but there’s a lot more to come.
If you have any idea’s or suggestions for me to talk about, send me a DM on twitter @pawiromitchel
Metrics
Let’s take a look at some metrics, I love to take a step back and zoom out to look at the bigger picture. Focusing on the fundamentals and on-chain data has always been my cup of tea, because it filters out a lot of noise
Data Sources
- CryptoQuant, on-chain metrics for ETH and BTC
- CBBI, a Bitcoin index that utilizes 11 metrics
- Bitcoin Fear and Greed Index, understanding the sentiment of the crypto market
- L2Beat, ETH layer 2 network growth
- DeFiLlama, tracking the DeFi Total Locked Value (TVL)
Bullish
ETH Exchange Reserve
There has been a LOT of withdrawals this year, the exchange reserve is drying up. I think it’s because all the farming opportunities, staking, lending and borrowing that are possible on the Ethereum chain. People are also bridging into EVM compatible chains such as BSC, Polygon, xDai, etc.
ETH Staking rate
The Staking rate is not slowing down at all 👀
Ethereum Layer 2 Deposits
The Layer 2 ecosystem received a lot of attention this year. With Arbitrum, Optimism, ZK Tech launching this year.
DeFi Total locked value
This handy tool is created by the DeFiLlama team to understand how much money is locked in the DeFi ecosystem.
We went from $630m to $249b, that’s a 40000% growth!
Ethereum is still dominating the space, but you can clearly see a downtrend. Money is flowing into different chains, could be people speculating on potential ETH killers.
BTC Exchange Reserves
BTC didn’t see a withdrawal rate as ETH, but still a downtrend. Thing is, we can’t do much with our BTC. We can bridge our BTC to wBTC on the ETH chain to farm yield with it, but then you’ve lost your native BTC coins. It’s up to you if you want to do it or not 😉
Bitcoin Miner Position Index
The Bitcoin miners are still hodling since the March crash and has been flat ever since. It’s even negative right now, that means that the miners are a little underwater. Do they know something? 👀
CBBI – Bitcoin Bullrun Index
The CBBI score is at 50🔻, lower than the previous recaps that we did. A score of 80 would be a level to start being cautious.
The score never went above 80 this year, so based on this data we could say that this cycle isn’t over yet.
Fear and Green Index
Again, lost of fear and doubt. This gives us the opportunity to buy cheap 😬
Bearish
Nothing to say here❌
Conclusion
2021 has been an amazing year for the crypto ecosystem, we’ve seen
- DeFi Flourish
- Layer 2 tech gaining traction (ZK, Optimism, Arbitrum, Plasma)
- Dapps going MultiChain so they’re not only on 1 single chain. Sushiswap, Paraswap, 1Inch are a couple of examples to check out.
- NFT mania with all the celebs, TikTok influencers 🙄
- DAO (Decentralized Autonomous Organizations) taking shape
What am I doing right now?
Chilling with my fam, watching Horror movies on Netflix (funded by my crypto income btw 😂).
My biggest income sources are
Tip Jar ☕
If you appreciate the work I’m doing, consider supporting the website 😊
ETH or ERC20: mitchel.eth
BTC Segwit: bc1qqfnfkrnhv903v9v38n98vvk35hgrp77ay7kwqr
BTC legacy: 1DhGZ1kvEF1wamq3oRb4f7pPz3cMBaxKz
Reminders
I’ll list some reminders for you guys and useful articles to help you understand certain topics better.
- Crypto money flow, always keep in mind that money flows from asset to asset. BTC ~> Mid Caps ~> Low Caps ~> BTC
- Fear is the mind killer, take control of your emotion and remember that you are the one pulling the trigger. It’s a lot harder than it sounds. This is the reason why you can’t rely on demo account or play accounts, because you’re taking away the biggest hurdle of an investor, EMOTIONS.