Dear Bitcoiners,
What an absolutely crazy week, with everything going on around the Coldcard incident and the upcoming BIP-110 chain-split risk this Saturday.
Joe Burnett, VP of Bitcoin Strategy at Strive and host of The Mustard Seed Podcast, had me on to discuss the ongoing events. We covered the Coldcard incident, BIP-110, Bitcoin’s bottom formation, and the current price action, using a full set of key on-chain charts!
A tragedy for self-custody
CDD, transfer volume, and fees, showing a visible but not FTX-style on-chain impact
Entropy and seed generation
Coldcard’s development process was below industry standard
New AI era: security breaches and faster code review
Protecting yourself: multisig vs. a single seed
Self-custody will come out of this stronger
Increased momentum for future upgrades, such as CTV for vaults and timelocks
BIP-110’s likely chain split on Saturday, August 8
On-chain fees: spam is not pricing out monetary use
Storing spam on-chain: outputs, witness data, and OP_RETURN
Pushing spam into worse places
Pushing a low-consensus soft fork
Bitcoin Spiral: where we are in the 4-year cycle
STH Momentum: ongoing capitulation, but higher lows
The bottom formation: Price and time capitulation
How recent events fit into the bear market bottom formation
STRC and SATA drawdowns during the Digital Credit stress test
Early signs of recovery back toward par
IBIT outflows and how ETF selling added pressure
Treasury companies, Digital Credit, and their role in dampening downside pressure
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Bitcoin around $64k, with the STH Cost Basis near $69k
Realized Price around $53k and CVDD around $46k
Key resistance levels: the STH Cost Basis, 200-day moving average, and 21-week moving average
Why Bitcoin likely needs time before a stronger recovery can begin
Bitcoin following the 4-year cycle
ISM PMI rising and the S&P 500 at ATHs
Midterm elections
As a paid subscriber, you get access to the live charts and indicators used throughout the episode, so you can keep tracking these developments yourself.
I hope this podcast provides you with useful insights and answers most of the questions around the Coldcard incident, BIP-110, and the ongoing bottom formation. If you have more doubts, feel free to share them in the comments. Your thoughts and feedback are always welcome! 🧡 👊
Until next week, 🫡
-Root
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