Ten31 Timestamp 851,986
The market saw its first negative monthly CPI print in over four years this week, boosting investor conviction (for whatever it’s worth) in rate cuts starting this fall. Fed Chairman Jerome Powell poured fuel on that fire with dovish commentary at his Congressional testimony this week despite a higher than expected PPI reading, and equity indices closed at (you guessed it) another all-time high to wrap up the week. As investors salivated for the long-awaited 25 basis points of rates relief from our monetary politburo, bitcoin continued to become a political issue this week; governments around the world are increasingly sorting themselves into the camps of HODL and HFSP, with Republican Presidential candidate Donald Trump making his pro-bitcoin stance official in his policy platform just as Germany was completing a firesale of its 50,000 bitcoin. Jurisdictional arbitrage opportunities appear to be playing out slowly but surely, and we expect those diverging decision paths to have meaningful consequences for every country over the coming decades.
Portfolio Company Spotlight
Ten31 announced an investment in Vida, an innovative provider of AI voice agent tools geared toward telecom service providers catering to SMBs. Founded by telecom industry veterans, Vida’s carrier-grade platform and API allow businesses and telecom providers to leverage the company’s AI voice agent technology to boost productivity and efficiency. Vida’s agents can integrate with over 7,000 apps to handle a wide variety of customer interactions from troubleshooting to call handoffs, as well as facilitating payments on both traditional fiat rails and via bitcoin’s Lightning Network.
Selected Portfolio News
Vida announced the launch of its AI voice agent product geared toward telecom service providers:
Mempool.spaced opened up its transaction accelerator product for broad-based use:
Unchained enabled sending to Taproot addresses:
Media
Ten31 Co-Founder Grant Gilliam published an essay on the power of compounding network effects within Ten31’s comprehensive, bitcoin-focused portfolio.
Ten31 Co-Founder Jonathan Kirkwood wrote a piece on a new way to conceptualize bitcoin’s role in the emerging digital economy.
Coinkite Co-Founder and CEO NVK joined the What Bitcoin Did podcast for a conversation on the future of artificial intelligence.
AJ Scalia and Drew Armstrong of Cathedra joined Tom Masiero of Kungsleden to discuss the proposed merger of the two companies.
Managing Partner Matt Odell appeared in a feature on using bitcoin natively in Lugano, home of the Plan ₿ initiative.
Market Updates
The cornerstone of the financial news cycle this week was the latest CPI print, which came in at -0.1% M/M for June, representing the metric’s first sequential decline in over four years.
This reading further ramped up market bets on near-term rate cuts, a trade that – despite having been famously premature for the past year – was also supported this week by relatively dovish commentary from Federal Reserve Chairman Jerome Powell at Congressional testimony this week.
In particular, Powell suggested that the central bank would prefer to start cutting rates before reported inflation reaches the Fed’s ostensible 2% target.
All that said, the Producer Price Index – which measures wholesale inflation at the producer level – came in higher than expected to close out this week, with the +0.2% M/M / +2.6% Y/Y reading reflecting the highest print in over a year.
Amid the market’s increasingly monomaniacal focus on benchmark rates and a few megacap stocks, the rolling three-year correlation between stocks and bonds has now reached its highest level in nearly 50 years.
The closely watched USDJPY exchange rate – which has been knocking on the door of 40-year lows for the past several months – rose sharply after this week’s CPI print, potentially due to US rate cut bets but more likely on the back of yet another BOJ intervention.
Bitcoin continued to range in ~$58,000 territory for much of the week as the German government wrapped up the historic own-goal of dumping its 50,000 bitcoin on the market. Despite the recent downside move, ETF inflows have remained very strong, taking in nearly $1 billion this past week.
Regulatory Update
Republican Presidential candidate Donald Trump announced his official policy platform this week, a proposal that includes explicit protections for self-custody, mining, and the freedom to transact with bitcoin.
President Trump also announced a keynote slot at the Bitcoin Conference in Nashville at the end of this month.
Outspoken pro-bitcoin Senator Cynthia Lummis made public comments this week suggesting that the US government should acquire bitcoin as a strategic reserve asset.
Much less encouragingly, new Congressional testimony from the head of the CFTC pointed to a plan for the agency to have regulatory oversight of spot bitcoin markets (rather than the derivatives markets the agency has traditionally regulated). While there is no specific legislation to this effect on the table yet, this expansion of scope could have significant compliance and surveillance implications for all companies and individuals interacting with spot bitcoin.
Noteworthy
Core Scientific announced a partnership with Block to develop a new bitcoin miner based on Block’s ASIC mining chip, making Core the first company to procure the new chip. Block will supply Core with 15 EH/s of chips as part of the arrangement.
AT&T announced that call and text records from 2022 for “nearly all” of the carrier’s customers had been compromised by hackers, the latest illustration of the vulnerabilities of centralized repositories of personal user information.
Travel
Ten31 Tribe Event @ Bitcoin Park, July 24
Bitcoin 2024, July 25-27
BitcoinMENA, Dec 9-10