December Week 2 - 2025

BITCOIN RESET
Phong Le Demystifies the FUD

In the landscape of modern corporate finance, Strategy, the firm pioneered by its Bitcoin focused treasury model, remains steadfast in its commitment to digital assets despite standard market fluctuations. CEO Phong Le recently clarified that while the firm popularised issuing equity and debt to purchase Bitcoin, current price corrections do not alter the company's long term operational roadmap.

Strategy maintains a current average entry price of approximately $72,000 per Bitcoin. Although market prices occasionally dip below this threshold, the company views these periods as cycles inherent to the asset class. To address concerns regarding debt and liquidity during down cycles, the company recently bolstered its financial position by raising $1.44 billion in less than nine days. This significant US dollar reserve is intended to cover dividend and debt obligations for nearly two years, effectively extending the company's operational runway until 2029.

A primary focus for Strategy is countering narrative driven volatility, often described as "FUD" (fear, uncertainty, and doubt). Financial models presented by the firm suggest that even if the value of Bitcoin were cut in half, Strategy would remain capable of meeting its financial obligations until 2065. This projection highlights the company’s intent to act as a primary proxy for Bitcoin in public markets, offering investors a liquid way to gain exposure to the digital asset.

Looking toward the future, Le predicts that Bitcoin has the potential to appreciate by over 20% annually for the next two decades, mirroring its historical performance over the last 18 years. This outlook reinforces the company’s strategy of relentless accumulation and its belief that institutional adoption by major banking entities signals a permanent shift in global asset allocation. For Strategy, the long term runway suggests that selling Bitcoin remains a non option for the foreseeable future.

CRYPTO RESET
New Tailwinds for Digital Assets

The global financial landscape is undergoing a significant shift, with key indicators pointing to a potential bottoming of liquidity and the emergence of new catalysts for risk assets, particularly Bitcoin. Market analysts are closely watching several macroeconomic developments that suggest a reversal from recent contractionary phases, marking a crucial moment for investors.

A primary driver of this shift is the U.S. Treasury’s General Account (TGA) refill. Following a period of depletion, the Treasury's accumulation of funds is injecting substantial liquidity back into the financial system. This influx, often overlooked, directly influences the availability of capital for investment, historically correlating with stronger performance in markets like cryptocurrencies. Simultaneously, the anticipated conclusion of quantitative tightening (QT) by central banks signals a move away from policies designed to reduce the money supply. As QT unwinds, the reduction in bond sales and balance sheet shrinkage will further ease financial conditions, providing a more favorable environment for asset appreciation.

These developments coincide with early signs of a new credit cycle, indicating renewed confidence and activity in lending and borrowing. A loosening of credit standards and increased access to capital typically precede periods of economic expansion and heightened investment. For digital assets, which are often sensitive to broad market liquidity, this combination of factors TGA refill, an end to QT, and a nascent credit cycle could represent a powerful confluence.

Experts suggest that these macro switches may be marking the precise moment Bitcoin begins to form its cycle bottom. The interplay of these liquidity injections and policy changes creates a fertile ground for speculative assets to thrive, positioning Bitcoin and the broader digital asset market for a potentially significant upturn as global liquidity conditions improve.

MONEY RESET
Navigating the “Gradual Print”

While record highs in the S&P 500 suggest a booming economy, a closer inspection reveals a "mirage economy" defined by sharp divergences. Beneath the surface of AI driven gains, the "S&P 493" the remaining bulk of the index has largely flatlined, signaling that the current market performance is increasingly tethered to fiscal dominance and deficit fueled liquidity.

The traditional era of aggressive Quantitative Tightening (QT) appears to have reached its limit. Recent market signals indicate that the Federal Reserve quietly halted balance sheet reduction in early December as liquidity shortages and repo market spikes made further contraction untenable. This shift marks the transition into what macroeconomic analyst Lyn Alden describes as "The Gradual Print", a structural phase where the central bank moves from active tightening to a gradual expansion of the money supply to support nominal GDP growth.

This transition is fueled by the structural necessity of financing record high public debt. In this environment, debasement becomes a persistent tailwind for asset prices, even as the broader productive economy struggles with stagnant growth. The divergence between headline indices and the "S&P 493" highlights a wealth concentration effect where only entities with exposure to high-growth tech or scarce assets can keep pace with money supply expansion.

For long-term investors, the focus is shifting away from simple interest rate forecasts toward understanding the global "liquidity lag." As the central bank independence becomes constrained by the need to support sovereign debt interest, the "debasement trade" in gold, bitcoin, and quality equities remains a primary defensive strategy against the erosion of purchasing power. In the new structural era, the health of the financial system is no longer measured by the absence of volatility, but by the resilience of assets against a permanent inflationary floor.

DISCLAIMER:
This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions or investments. Please be careful and do your own research.