The article below accuses BlackRock of pushing the price of Bitcoin lower in a process of accumulation shares prior to a Bitcoin ETF approval. We find the claim credible and even normal process of large players when accumulating shares of an illiquid investment. There is nothing illegal in this. It is even normal procedure in the markets. Lets say I a Big Investor and want to accumulate a position in illiquid stock. I would call my broker/ market maker and place the order. The broker/market maker would check the street for other bids and offers. This is a pretty close group who is talking and dealing with each other frequently. One or more of these market makers might pull their normal bid from the group. This removes some support from the position. This pulling of the bid allows a vacuum to form in which the share price falls allowing the price to drift or fall lower. In the old days a well-known market journalist would write a negative article for pay to “help” the share price fall. This is called “Yellow Journalism”. This journalist was fined for such writing and though not often enforced, is illegal.
How The Big Players Manipulate The Stock Market – Seeking Alpha 2012
As stated earlier, some of this activity is legal and even normal.
We are currently in a slow volume, wait and see period in the market. There is expectation that BlackRock and eight other companies will get approval for a Bitcoin ETF. This would open the flood gates of new money to flow into Bitcoin. More buyers than seller equals a higher price. It would be normal for any of these nine companies to want to buy Bitcoin ahead of any Spot ETF approval. This is, as I said normal and not illegal. It is working with probabilities as opposed to wait and see- then act.
BlackRock deliberately driving down Bitcoin price
in anticipation for Spot BTC ETF approval, analyst says
Cryptos | 09/05/2023
- Analyst Crypto Rover attributes the current lull market to BlackRock, accusing the asset manager of deliberately driving down Bitcoin price.
- In his opinion, the firm is trying to achieve a better buying position so that the ETF earns them more upon approval.
- While this is mere speculation, it is a reminder for retail investors to be more analytical in a market swayed by big players.
Full Story Linked here
In accounts related to LOTM, we hold positions in a number of companies related to Bitcoin/Crypto. Galaxy Digital (BRPHF*) and Soluna (SLNH*) are two such companies.
Soluna: Recently some on who has owned or trade Mechanical Tech and now Soluna as far back as 2008, bought 8% of Soluna common stock. That is 2.9 Million shares. Two million share bought in August of this year have an average cost of $0.25 per share. This person is a CPA and is an owner od f a CPA practice. Obviously, his motive is to buy the probability of Soluna’s revenue increasing (see recent company press releases), that the company will survive (a question for many) and anticipating potential good news and high prices for Bitcoin on an Spot ETF approval – Soluna end product from mining.
The building blocks are in place for Soluna however the biggest questions are Can Soluna management execute its strategy, and will a Spot Bitcoin ETF get approved? Link to 13D filings for Soluna at NASDAQ site.
Galaxy Digital (BRPHF*) is in a better position but similar position. “If” a spot bitcoin ETF is approved, it would drive interest into stocks related to the Blockchain eco-system. Current, the price of Galaxy is drifting lower, few buyers but a few more sellers than buyers. Volume is lower than average. The price will likely drift lower until news come of a Spot Bitcoin ETF approval or negative news concerning the Spot Bitcoin ETF.
Galaxy has more on the line as they have applied for listing in the United States. With a Spot Bitcoin ETF approval, it is probable Galaxy would get such an approval. The shares are cheap in our opinion, and we have high expectations for the share price.
Speculation on approval of a Spot Bitcoin ETF is as soon as late October or by sometime in the second quarter of 2024.
SEC Delays Spot Bitcoin ETF Decision for All Applicants Including BlackRock, Fidelity.
In practical terms, what does this mean for you?
If you believe the probability that Soluna will survive and grow, then you might hold (or buy) through any further price weakness, anticipating a turn around and better pricing for the stock.
If you are more of a trader with shorter timeline goals, then you might wait until the price breaks above its most recent highs around $0.36 on a closing price basis. Then consider buying for a further run higher.
Galaxy Digital is on solid footing financially at this time – different from Soluna. We are dollar cost averaging into Galaxy Digital at this time to lower our cost and work the probabilities of an approval of a Spot Bitcoin ETF.
Invesco (IVZ) and Galaxy have partnered and are one of the nine pending applications for a Spot Bitcoin ETF.
We have assumed that Blockchain and a small number of crypto currencies are one of the fastest growth industries of the next decade of two. We want to be along for the ride!
#galaxydigital #bitcoin #solunacomputing # crypto
For Actionable Stock Ideas, consider a subscription to Tom’s LOTM Blog.
LOTM Style – We are more a controlled speculator, than diversified investor or short-term trader. We allow 100% loss/risk on some purchases. Often, we dollar-cost-average into losing positions. Volatility is our friend, not something to be feared. We let our winners win, as much as possible. We do not like paying taxes. We love value, yet watch charts. Our goal is to find value stocks that might double in one to three-years.
See our website for our doubling to a Million$ game. We were playing this game of doubles before Patrick Ben-David talked about it. Ideas in this blog are highly volatile and only for use by those who are comfortable with high-risk, high-reward investments.
Written September 7, 2023 by Tom Linzmeier, for Tom’s LOTM Blog at https://lotm.substack.com/.
Accounts related to LOTM and Tom Linzmeier can & will, buy or sell securities at any time.
LOTM Research & Consulting Service
* An account related to LOTM holds a position in this security.
Neither LOTM nor Tom Linzmeier is a Registered Investment Advisor.
Consult your investment advisor for investment advice appropriate for your situation.
To Unsubscribe, please select “return” and type Unsubscribe in the subject line.
Tom’s LOTM Blog page https://lotm.substack.com/
