Monday Alpha #42

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TL;DR: This Week On America’s Got Tariffs

BTC ATM IV

• 1W: 44.76%

• 1M: 48.21%

• 3M: 51.71%

• 6M: 53.81%

• Index Price: $88,390

• DVOL: 49.75

ETH ATM IV

• 1W: 66.14%

• 1M: 66.73%

• 3M: 67.82%

• 6M: 68.46%

• Index Price: $1,630

• DVOL: 68.43

Marty's Thoughts & Quarterly Recap

• BTC: -5.31%

• ETH: -50.96%

• GOLD: 30.50%

• SPY: -12.58%

It has been a wild few months, to say the least. From a new U.S. president launching memecoins to prices dwindling and hype fading... but is it over? It’s turning into a reality TV show, it seems. This quarter has been nothing like anyone expected. People anticipated simpler things—like the market going up—but Trump is on a mission, creating uncertainty. And as we know, uncertainty means increased volatility. As a result, the market has simply gone down. It’s more of a domino effect, creating a chain reaction, with Trump tackling immigration, trade, and looking to refinance U.S. debt—all at once in his first few days.

I want to emphasize that it’s not just him saying, “We’re going to do XYZ…”—it’s him saying that, then literally the next day flip-flopping on what he said. I’m all for keeping your enemies on their toes, but this is creating wealth destruction and forcing larger capital allocators to look elsewhere.

As I’ve previously written, the average American doesn’t care about investments, as most have none. They care about the cost of goods, things like rent and gas—normal, everyday concerns. Tariffs are simply a tax that will hit the end consumer. In the long run, it’s probably best for the U.S. to be more independent and make more things locally, but that also means costs will increase to support U.S. living wages. I have a lot of doubts about everyone moving factories back to America. We can use Brazil as an example—with its 60% import tax, some manufacturers came and stayed, but others still found it cheaper to produce elsewhere and import in.

Americans live on credit, so there’s talk about whether spending will go down... I think that’s highly unlikely, as they offer Klarna 4x payments on everything, and let’s be real—people don’t know how to budget. That being said, I do think the U.S. consumer will stop upgrading their car every two years, their iPhone every year, etc. But essentials—and Temu slop—they’ll keep buying on credit, regardless of tariffs.

As I write this, gold is hitting all-time highs, and BTC is pumping as TradFi gets nuked. The move we’ve been waiting for. Not sure how long we stay correlated with gold, but there’s a clear shift in the markets—people are getting more and more scared. I think the majority of investors were still generally optimistic, thinking they’d skate through tariff season or that deals would be reached… but I think we’re heading toward the worst-case scenario: no one is playing ball or agreeing. Trump tried to bully, and it isn’t working as expected.

As this happens, people rush to safe havens—gold… and now… BTC? BTC may have a role, just in case there are major capital controls in the U.S. (a worst-case scenario). I’m not sure how long the bid will last on crypto as a whole, but now would be the time for BTC to shine for once.

So is it over? For some, maybe. But for gold and BTC bugs, it seems like it’s just getting started while the dust settles. BTC is still down 5% on the year—let’s not get too hopeful yet. Last note: just because BTC has a bid doesn’t mean every other crypto should too.

As for our term structure, things seem pretty standard issue. Two weeks ago, we had a price nuke that spiked vols into the heavens. If you tried to sell that too early, you got destroyed—but cheers to the players who sold the spikes and prospered.

As we look into 2025 and Q2, there’s no major crypto-specific news. We’re still waiting for ETH staking to be included in ETFs, and for more guidance on U.S. reserves and stockpiles. The reserve and stockpile were the hype and talk of the town, and now it’s gone ghost—we await more guidance from Sacks and his team.

Huge difference in the last 24 hours’ largest option volumes—BTC seems generally hopeful, while people on ETH are buying doomsday puts: $1K, $1.2K, and $1.3K strikes on ETH. This kind of falls into the narrative of people running to BTC as a safe haven, but that doesn’t mean the rest of the crypto coins will catch a bid at all. Be careful with the bags you choose.

Crypto 1-Month Returns

From top to bottom, 1-month returns in large caps, mid caps, and small caps.

Finally, some red and green, not just red. Fartcoin seems to be stealing the show. As we all know, the greatest meme... hot air rises. As for the rest of the buckets, returns seem to be scattered, with AI-type coins showing the biggest gains. If you bought the dip, hopefully you picked the right bags.

I'm increasingly interested in basket-style product offerings, so investors and traders don’t have to pick individual coins—they can pick a basket. Example: an AI basket, MEME basket, Top 3 market cap basket, etc. I'm still on the lookout for the rise of these types of products as more institutional players enter the space.

Quick Chart Dump

Funding for the last month has still been flat, with some hot spots on XMR and HYPE. The last few weeks I was asking our readers why OM had crazy funding and nobody came out with a clear cut answer… well it was a scam… sigh.

We finally have some true winners, with the AI sector leading the pack, with the biggest loser being the gaming sector.

I don’t even want to show basis any longer, it’s dead, it died, JOEVER, sub 5% 3 month annualized. It’s just sad.

When or if basis gets back to 20%+ just remember to lock it in, play it safe, profit and rejoice. I’ve shown it… just to show that it indeed is over, the basis has been entirely juiced.

As for returns by sessions, one would think that the ETF flows rule the game, but APAC sessions over the last month have been the leader for positive returns.

• Charts from VeloData: https://velodata.app/

• X: https://twitter.com/VeloData?s=20

Wrap-up

People already look at Americans like they’re a little stupid, and honestly, I think their views are justified. All you need to do is turn on the news, and it feels like a bad reality TV show playing out in real time. It’s going to take a while for the U.S. to find its footing and hit bottom. With policy flip-flopping daily and no deals being made, the world is calling the U.S.’s bluff.

I’m in the camp that Trump and his administration thought the world would bow to the U.S. because it holds the reserve currency, its capital markets are the largest, and so on, but clearly, that isn’t the case.

It’s too early to tell, but maybe Dalio is right. If you know anything about the guy, he sees the world in cycles, and he’s slowly leaning toward the view that the U.S. is in decline. That opens the door for another player to rise to the top. No investor or capital allocator wants to put money to work in the U.S. right now with so much uncertainty. Larger players will simply look elsewhere. It’s probably a good time to diversify and consider alternatives, just in case. Not to say the U.S. is going under overnight, but I’ve got 60-plus years left, and it could happen in my lifetime.

Just give it some thought. I’d love to hear readers’ feedback, or even have some larger players or pimps on the Premia X Marty stream. Ponder this: Why would anyone want to play hardball with the U.S. and its flip-flop policy when they could just put their money to work somewhere else?

Looking ahead, I hope BTC still catches a bid, but that doesn’t mean the rest of the crypto industry will or should. There are still tons of unknowns around policy, taxes, and the future of crypto in the global ecosystem. I’d expect capital allocators to keep looking elsewhere if the U.S. keeps acting like a reality TV show.

As we move into 2025, Kyan (Premia V4) will be launching. With portfolio margin and perps, it’ll be a great place to check out, trade, and compete in upcoming competitions for rewards. The majority of my Q2 will be spent working with Mr. Weka writing educational content, including more long-form pieces, advanced topics, and how-to tutorials. We may even make some videos to make learning easier for everyone. If there’s something you’d like to see us cover, please reach out!

For now, if you’re interested in learning the basics of derivatives, check out the current edition of the academy here: academy.premia.blue.

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Recap:

• Vols Died

• APAC Session Leads Positive Returns

• Gold/BTC Pumping On US Uncertainty

• Expect Players To Look Elsewhere If US Keeps Acting Like A Reality TV Show

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