Ten31 Timestamp 895,057
Don’t look now, but the market has been on a quiet heater since the financial system’s plumbing almost sprung another leak in mid-April. Major equity indices have punched back through their pre-Liberation Day levels as the S&P 500 has posted its longest daily win streak in over 20 years and dip-buyers everywhere are proclaiming that we are, in fact, so back. The victory laps may be premature given most underlying economic data points in the US seem to be ticking downward, but the multi-lateral pain brought on by President Trump’s tariff regime also appears to be coming to the fore, with several headlines this week indicating growing stress in the Chinese economy. This geopolitically momentous game of chicken (or, in the administration’s parlance, “strategic uncertainty”) has perhaps obscured bitcoin’s quietly resilient performance for many market participants this year – despite a level of macro uncertainty matched only by a few moments in history since the Nixon Shock of 1971, the Little Magic Internet Money That Could is now up YTD and knocking on the door of the $100,000 level once again as signposts of sovereign stacking continue to accumulate. We can’t make a call on how Trump’s next Truth Social screed may move markets in the short-term (and we suspect most of his inner circle is in the same boat), but we continue to feel more confident than ever that bitcoin’s best years are ahead of it.
Portfolio Company Spotlight
Fold is a leading financial services platform providing the most comprehensive bitcoin-denominated consumer rewards programs and a suite of services bridging bitcoin and traditional financial rails. Fold offers debit cards that accrue cash-back rewards in bitcoin that can be withdrawn to customer-controlled wallets, on top of unified checking and bitcoin custody accounts allowing users to seamlessly combine their USD and bitcoin activities to better preserve and grow their wealth. Fold has an exciting product pipeline – including a credit card set to be launched in the near term – and recently completed its public listing with nearly 1,500 bitcoin on its balance sheet, giving the company one of the largest corporate bitcoin treasuries in the world.
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.xyz/invest to learn more and get in touch to discuss participating.
Selected Portfolio News
Primal rolled out a major new Android update adding a wide variety of features:
Media
Strike Founder and CEO Jack Mallers appeared on Bloomberg to discuss Twenty One’s bitcoin treasury strategy.
Fold Founder and CEO Will Reeves and Ten31 Managing Partner Jonathan Kirkwood led the Fold team in ringing the Nasdaq opening bell on Friday morning.
Ten31 Advisor Harry Sudock spoke with Cantor Fitzgerald about the future of bitcoin mining economics.
Coinkite Co-Founder and CEO NVK appeared on Citadel Dispatch with Ten31 Managing Partner Matt Odell for an update on bitcoin self-custody and the company’s product pipeline. NVK also joined the Stephan Livera podcast this week.
Fold business development lead Brian Harrington sat down with Ten31 Managing Partner Marty Bent to discuss how Fold helps users more fully integrate bitcoin into their financial lives.
Market Updates
The first GDP reading since President Trump decided to upend all of global trade came in slightly negative at -0.3% for Q1, though the real net impacts have yet to be seen given this data point was cut off just before Liberation Day.
Trump responded to the headline with a request for patience among the American public, noting that this process “will take a while.”
Somewhat more encouragingly, the latest Non-Farm Payrolls report for April was above consensus and only down slightly M/M despite significant regime uncertainty among business owners.
Following the more positive report, the President again got on the horn to Fed Chairman Jerome Powell to encourage him to cut benchmark interest rates.
Interestingly, Kevin Warsh – a former Fed Governor, a long-assumed heir apparent to the Iron Throne in the Eccles Building, and potentially the current Shadow Fed Chair – gave a speech at a G30 meeting this week criticizing the Fed’s historical policy missteps.
In spite of all the past month’s sound and fury, major US equity indices closed this week above levels established just before Trump’s April 2nd tariff bazooka, and the S&P 500 reached its longest daily win streak in over 20 years (whether that’s a sign of true underlying strength or just your garden variety face-ripping bear market rally remains to be seen).
Trade scuttlebutt continued to trickle in all week, as Treasury Secretary Scott Bessent indicated that talks with major Asian trading partners are going very well, while at the same time noting that the administration is intentionally creating “strategic uncertainty” for its counterparties.
Commerce Secretary Howard Lutnick also suggested the US has reached its first trade deal, but elected not to name the country involved (she doesn’t go to this school, you wouldn’t know her).
Separate reports suggested that India is prepared to offer a “future-proofed” deal complete with most-favored-nation status to the US in the near term, a potentially significant first step toward establishing a pro-US trade nexus.
On the flipside of all the posturing, Japan’s Finance Minister publicly acknowledged that the country’s vast holdings of US Treasuries could be “a card” the country might choose to play in the trade standoff (though it’s unclear how much bite that threat truly has based on the dynamics at play).
Amid the uncertainty, the Bank of Japan elected to pause its rate hike regime as it awaits further clarity on trade.
Rough fundamental data points continued to pile up in the US, as the Dallas Fed’s manufacturing survey posted its worst result since spring 2020, and the new orders components of all regional Fed surveys have declined sharply.
Meanwhile, several major US west coast ports are seeing precipitous downticks in activity. Asset management giant Apollo published a new report on the potential oncoming impacts from the “hard stop” showing up in many verticals of the global economy.
There are two sides to that coin, though, as the above also means orders for Chinese exports have weakened substantially in recent weeks. In response, Goldman Sachs published a piece estimating that the trade reset threatens at least 16 million Chinese manufacturing jobs in the coming months.
Perhaps not coincidentally, China quietly exempted roughly 25% of US imports from its own tariff regime and softly suggested it’s “evaluating the possibility of starting” trade talks with the US soon. The Xi government is reportedly also weighing an offer on fentanyl controls to kickstart negotiations.
After months of tense negotiations and some Art of the Deal at the Vatican, the US and Ukraine finally reached a minerals agreement that will give the US favorable access to Ukraine’s rare earth reserves, which may be particularly strategically relevant given recent Chinese curbs to minerals exports.
The UK and EU also announced their own new partnership deal to strengthen trade and security, though it’s unclear how much impact this has on the key pieces of the chessboard.
The US Treasury Department released its latest quarterly borrowing estimates, which project that the US is set to borrow another $514 billion for the second calendar quarter, $391 billion higher than previously estimated in February. While there’s some nuance to this increase, the Treasury also expects to borrow $554 billion in Q3, good for an annualized pace of $2.2 trillion (or +23% Y/Y).
A separate report from the Treasury’s Borrowing Advisory Committee called for an end to the federal debt ceiling given that the limit does little to constrain borrowing in practice.
The Financial Times ran a piece highlighting China’s ongoing diversification away from US Treasuries, though apparently at a deliberately slow pace to minimize a self-defeating market impact. While some of these reserves are moving into gold, much of the balance appears to be rotating into US agency securities.
Bitcoin ripped along with the rest of the market this week, reclaiming the $97,000 level as ETFs continued to put up strong performance at nearly $2 billion of net inflows on the week.
Brown University reported its first allocation to IBIT, making it the third university endowment to disclose bitcoin holdings (behind Emory and the University of Austin).
Regulatory Update
Commerce Secretary Howard Lutnick reiterated the Trump administration’s support for the bitcoin industry this week in an interview with Bitcoin Magazine.
US Senator Cynthia Lummis commented this week that President Trump supports passing her strategic bitcoin reserve bill, which would direct the US to accumulate 1 million bitcoin.
The Deputy Director of the CIA – admittedly a strange bedfellow for permissionless, non-state money – said this week that bitcoin is a national strategic priority on which the US must play a leading role.
The Arizona Congress became the first state legislature to pass its own bitcoin reserve bill in both chambers. However, the bill was ultimately vetoed by the state’s governor on the basis that bitcoin – the seventh-largest asset in the world by market cap – is an “untested investment.”
The Swiss National Bank also formally rejected adding bitcoin to its reserves this week despite growing interest domestically.
The Bitcoin Policy Institute published a report on statutory changes that could pave the way for using bitcoin as collateral for standard consumer mortgages.
Noteworthy
Sam Lyman, author of a recent Forbes article promoting BitBonds, joined the US Treasury Department as Secretary Bessent’s lead speechwriter.
A report from cryptocurrency surveillance firm Elliptic attempting to highlight how digital assets are used for money laundering indirectly called out how traditional finance rails are actually the key pivot point for most criminal transactions.
Large “crypto” trading firm Two Prime announced its pivot to a bitcoin-only strategy, calling Ethereum “statistically broken.”
Leading bitcoin treasury company Strategy announced it will reload its historically large $21 billion equity ATM facility to acquire more bitcoin as part of its Q1 earnings call.
Travel
Bitcoin++ Conference, Austin, May 7-9
Bitcoin 2025, Las Vegas, May 27-29
Bitcoin Policy Summit, Washington DC, June 25-26