Ten31 Timestamp 877,808
Bitcoin celebrated the 16th anniversary of its genesis block on Friday just after having closed out another year of elite risk-adjusted returns, edged out by only the world’s most important AI infrastructure company and the world’s largest bitcoin accumulation vehicle. Even with dollar strength at multi-year highs, the 10-year US Treasury yield pushing back toward its 15-year high watermark, and soft ETF flows to close out the year, bitcoin still finished the week just under $100,000 as network hashrate touched 800 EH/s for the first time. The steady cadence of strategic bitcoin reserve headlines from around the world continued all week, a topic we would expect to gain even more traction this month as the inauguration of President-elect Trump – who reportedly views the bitcoin price as a major KPI for his administration – is now just two weeks away. As bitcoin becomes more geopolitically relevant, the credit backdrop in major economies looks progressively more tenuous, and global central banks appear poised to become more accommodative on the margin, we continue to expect 2025 to be a banner year for bitcoin and the leading companies in the bitcoin ecosystem.
Portfolio Company Spotlight
Unchained is a bitcoin financial services platform offering a suite of products to consumers and enterprises for securing and managing bitcoin holdings through a multi-signature, collaborative custody model. Unchained’s infrastructure allows users and institutions to hold 2 of 3 keys in a multi-sig quorum, offering customizable custody experiences to meet a variety of personal, family, and business needs while enhancing security and mitigating custody risk. Unchained offers many additional financial services on top of its custody platform, including integrated trading services, bitcoin-backed lending, IRA and inheritance products, a mobile app for easy access to the platform, and much more to come.
As the world’s largest investor focused entirely on bitcoin, Ten31 has deployed nearly $150 million across two funds into more than 30 of the most promising and innovative companies in the ecosystem, and we expect 2025 to be the best year yet for both bitcoin and our portfolio. Ten31 is raising multiple new funds and has already built out a strong initial portfolio for each. Visit ten31.vc/funds to learn more and get in touch to discuss participating.
Selected Portfolio News
Fold announced a $30 million bitcoin-collateralized capital raise from ATW Partners to help accelerate growth and product development:
Unchained Co-Founder and CEO Joe Kelly published an overview of the company’s 2025 roadmap:
Media
Ten31 Managing Partner Matt Odell joined ARK’s Bitcoin Brainstorm show to discuss how quantum computing might impact bitcoin over time.
Matt also appeared on the latest episode of Money Matters with Strike Founder Jack Mallers.
Jack joined a discussion with the Bitcoin Policy Institute on how bitcoin can benefit the United States.
Unchained Senior Software Engineer Buck Perley joined Citadel Dispatch with Matt Odell to discuss Unchained’s approach to open source software and its open source coordinator Caravan.
Buck also published a piece delving into the same topic on Unchained’s blog.
Unchained’s Joe Burnett joined Nik Bhatia’s podcast to discuss bitcoin’s key role in preserving wealth over time.
Debifi published a new report with results from a recent survey indicating strong interest in bitcoin-collateralized lending and user preference for non-custodial options.
Market Updates
The dollar continued its recent strengthening this week, as the DXY index touched the 109 level for the first time in over two years. The dollar index is up ~9% over the past 3 months, an ongoing headwind to risk-on assets.
Meanwhile, the yield on 10-year US Treasury bonds continued to hover around the 4.6% level, keeping the benchmark rate close to its multi-decade peak.
As rates remain elevated relative to the past decade, pockets of the commercial real estate landscape continue to look very challenged, and the delinquency rate on office mortgage-backed securities has now risen above levels last seen in the wake of the 2008 financial crisis.
The credit backdrop for lower-end consumers also continues to look tenuous, as US credit card lenders wrote off $46 billion in seriously delinquent loans through the first nine months of 2024, up 50% Y/Y and the highest level since 2010 (though delinquency rates have, for now, arrested their upward momentum, as total outstanding credit card debt hit a record $1.2 trillion in Q3).
US Manufacturing PMI was up M/M for December to the highest level since March, though the metric remained below the critical 50 level, extending an unprecedented multiyear run in contraction territory.
Overseas, the PBOC publicly commented that it plans to cut interest rates sometime in 2025 as it seeks to transition to more “orthodox” monetary policy focused on broad rates rather than targeted stimulus of bank credit to specific favored industries.
China’s 10-year Treasury yield has continued to drop precipitously, ending the week at an all-time low of less than 1.6%.
Following a record-shattering year, spot bitcoin ETFs closed out 2024 on a skid, and IBIT posted its worst day since launch to kick off 2025 (though Friday saw a nice rebound for the whole complex).
Against the various short-term headwinds that have cropped up in the past month, bitcoin still closed out this week at just under $100,000. Total network hashrate, meanwhile, touched 800 EH/s for the first time, finishing the year up more than 50%.
Regulatory Update
Bitcoin advocates in Switzerland submitted a formal proposal for the Swiss National Bank to build a bitcoin strategic reserve. The initiative will have 18 months to gather the 100,000 signatures necessary to move forward with a public referendum on the proposal.
Elsewhere, a Hong Kong lawmaker publicly advocated for adding bitcoin to the region’s government reserves.
Amid the growing wave of legislative bodies around the world paying more attention to bitcoin’s geopolitical relevance, $1.5 trillion asset manager Franklin Templeton said it expects to see “several nations” adopt strategic bitcoin reserves this year.
Following an injunction delaying the implementation of the Corporate Transparency Act and then a court ruling overturning that injunction, yet another court ruling reinstated the injunction this week. The court will hear arguments on the issue in March of this year.
Various industry groups sued the IRS over its new, overly broad broker rules for non-custodial services set to take effect in 2027.
Meanwhile, the IRS agreed to postpone the implementation of its cumbersome new bitcoin cost basis reporting rules until 2026.
As part of the EU’s long-running quest to become the least hospitable place in the world to do business, the region’s controversial new “Travel Rule” officially took effect at the start of this year, forcing financial service providers to collect and verify detailed personal information for transfers of digital assets to self-custody wallets.
Noteworthy
The US Treasury Department reported a major cyberattack by state-sponsored Chinese actors which compromised unclassified documents, the latest such incident that should make all US citizens feel uneasy about government safeguarding of sensitive personal information.
Twitter CEO Elon Musk stirred up his latest round of controversy this week by retaliating against users critical of his immigration stance. The substance of that debate aside, the incident highlights once again the value of neutral, permissionless communications protocols like Nostr.
Barbara Goodstein, Managing Partner at centimillionaire community R360, returned to CNBC this week to discuss (without direct prompting) the group’s growing conviction around bitcoin heading into 2025.
A new report from CoinMetrics estimated that the bitcoin network transferred nearly $7 trillion of value in 2024, adjusted for change outputs.
OpenSats published its 2024 Year in Review, highlighting over $20 million in total grants paid out for the year.
MicroStrategy Founder and Executive Chairman Michael Saylor, who has been deploying his $42 billion bitcoin accumulation plan far more aggressively than expected, tweeted about a visit to Mar-a-Lago with Eric Trump, who recently called for a $1 million bitcoin price at the BitcoinMENA conference in December. As usual, we would guess this is probably nothing.
Travel
Austin BitDevs, Jan 16
Nashville BitDevs, Jan 28