Ten31 Timestamp 887,919
It was another rough week for dip-buyers everywhere, as the S&P 500 joined the Nasdaq in correction territory on the back of ever more aggressive tariff commentary from the new administration. If the plan is to drive uncertainty and declining consumer sentiment, that seems to be working, but Treasury buyers still haven’t gotten the memo, as the 10-year yield is only down ~15bps since the 10%+ slides in major indices began a few weeks ago. With the US deficit continuing to blow out despite much sound and fury from DOGE, Treasury facing a $3 trillion refinancing wall this year, and declining wealth effects from a sputtering stock market potentially denting tax receipts, we’d expect the near term to remain rocky for all assets including bitcoin. That said, those same factors may make regulators increasingly receptive to less conventional policy paths like those outlined at this week’s Bitcoin for America conference in DC, including Senator Lummis’s reintroduced BITCOIN Act and the Bit Bonds concept proposed by Battery Finance Founder Andrew Hohns. Whatever the ultimate event path, the confluence of factors we’ve seen over the past few weeks has only increased our conviction that we’re living through one of those years when decades happen.
Portfolio Company Spotlight
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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. Visit ten31.vc/funds to learn more and get in touch to discuss participating.
Media
Strike Founder Jack Mallers and Battery Finance Founder Andrew Hohns both gave presentations at the Bitcoin for America summit in Washington.
Jack was also featured in a talk at the Bitcoin Investor Week conference in New York.
Debifi Founder and CEO Max Keidun was featured in a Bitcoin Magazine profile highlighting Debifi’s launch and plans to scale.
Market Updates
This week was another bloodbath for stocks, as the Trump administration continued to pour gasoline on the policy uncertainty fire. The S&P 500 officially entered a correction, and US stocks have now lost $5 trillion of equity value (or 2.5x bitcoin’s all-time high market cap) in just three weeks.
The S&P hit the -10% correction level in only 16 days, good for the seventh-fastest correction since 1929.
President Trump and his cabinet maintained the talk track of the past few weeks, as Trump wouldn’t rule out a near-term recession and counseled the country to stop looking at the stock market.
Meanwhile, Treasury Secretary Scott Bessent reiterated that the administration is focusing on the “real economy” and isn’t disturbed by “a little bit of volatility.”
Amid the uncertainty and selloff, Fed Governor Adriana Kugler indicated she’s most concerned about persistent inflation and that it could be appropriate for the central bank to hold rates at current levels for an extended period.
Trump – who said he’s “not going to bend at all” on his trade policy – ramped up threats against trading partners once again this week, proposing 50% tariffs on Canadian steel and aluminum (before later softening that message) and 200% tariffs on European alcohol imports.
Despite the trade turmoil, National Economic Council Director Kevin Hassett suggested this week that trade policy will be sorted out by April, at which point markets should calm and the economy should hum.
For all the carnage in equities, the yield on the US 10-year Treasury is only down ~15bps since the selloff began, suggesting that Trump and Bessent may need a bigger boat if they want to scare the market into longer duration bonds.
The playbook seems to be working on Main Street, though, as the latest University of Michigan consumer sentiment survey went south for March while one-year inflation expectations climbed to nearly 5%, the highest level since 1993.
In a similar vein, the Wall Street Journal ran a feature on consumers and business owners broadly pulling back from new spending, and Delta Airlines cited plunging flight demand in disappointing earnings guidance this week.
The US federal deficit hit nearly $1.2 trillion for the first five months of this fiscal year, setting a record for the period and more than doubling from February despite aggressive DOGE cuts. The deficit is on pace to reach ~$2.8 trillion this year, a figure that may be exacerbated in the case of a recession and / or sustained high refinancing rates for this year’s Treasury maturity wall.
On a potentially more encouraging note, the inflation backdrop softened somewhat, as CPI came in slightly below expectations in February (though is still hovering near 3%). So-called “supercore” inflation maintained its recent pace of declines, and producer prices were in line with expectations.
It’s also worth noting that the recent Atlanta Fed estimates for very weak Q1 GDP may be seeing artificial downward bias from massive gold imports into the US over the past few months; adjusted for this impact, the figure is tracking to be slightly positive rather than down 2%+.
In overseas markets, interest rates on long-dated Japanese government bonds continued to hover around highs not seen in 15+ years, but BOJ Governor Kazuo Ueda suggested he’s not concerned for now and will maintain an upward bias on benchmark rates.
Meanwhile, Germany’s incoming Chancellor indicated he had secured support for a massive increase in government borrowing to support continental rearmament and infrastructure spending, even as yields on German government bonds sit at post-2011 highs.
Regulatory Update
Senator Cythia Lummis reintroduced her BITCOIN Act with five new Republican co-sponsors, commenting that she’s “for real this time.”
Congressman Nick Begich introduced a companion strategic bitcoin reserve bill in the House with its own set of six co-sponsors.
At the Bitcoin Policy Institute’s Bitcoin for America conference this week, Democratic Congressman Ro Khanna suggested bitcoin should be a bipartisan issue.
The Texas House of Representatives introduced another bitcoin reserve bill that would allocate up to $250 million to bitcoin and other digital assets.
However, the Utah legislature – which previously had the most advanced state bill for a bitcoin reserve – scrapped the idea of the state accumulating bitcoin in the latest version of the law. That said, the bill still contains some valuable provisions to protect bitcoin mining and self-custody.
The US House of Representatives followed the Senate’s lead and voted to overturn the IRS’s digital assets broker rule, a Biden-era provision that would have imposed onerous and impractical obligations on self-custodial wallets and decentralized exchanges.
Less encouragingly, the Treasury Department “temporarily” lowered its threshold for Currency Transaction Reports from $10,000 to just $200 in thirty US ZIP codes in Texas and California, ostensibly in the name of targeting drug cartel activity in those areas.
Europe extended its bid for total control of its citizens’ financial lives this week, as the ECB confirmed it will launch its Digital Euro CBDC in October, and the Commissioner of the EU indicated the supranational organization plans to “turn private savings into much needed investment” for defense and other priorities.
Russia’s central bank, meanwhile, proposed a new program to allow “specially qualified” wealthy individuals to trade and hold bitcoin and other digital assets.
Noteworthy
X (fka Twitter) experienced an extended outage on Monday, which owner Elon Musk attributed to an aggressive cyberattack. The episode highlighted the power of open source communications protocols like Nostr, which are much more fault-tolerant against such an incident.
In a similar vein, Jack Dorsey – whom you may recognize as the founder of Twitter – was locked out of his own Twitter account this week.
Bitcoin miner and technology provider Bitdeer announced it has developed the first ASIC chip that can achieve efficiency of <10 J/TH.
Cashu protocol developers opened up the ability to send Cashu tokens (units of Chaumian ecash pegged to bitcoin) through emojis, highlighting the extensibility and flexibility of programmable internet-native money.
Travel
Nashville Bitdevs, Mar 18
Austin Bitdevs, Apr 17
Bitcoin 2025, May 27-29