5-Min Monday Macro, Crypto & AI: #72, 17th Feb

Long term tariff effect, current mood - meh, awaiting next crypto catalyst for bull run to continue

Hey!!!! It’s Monday again. Welcome to another fantastic week!

I spend hours reading, researching, and talking to the smartest founders and investors in macro, crypto, and AI every week. This is my attempt to give you a short 5-10 minute summary on how I am thinking about the macro and crypto markets and what lies ahead. Hundreds of hours summarized, so you don't have to.

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TL;DR

1. Zeitgeist - CPI ticking up but muted by effects of federal DOGE cuts in future
2. Macro - Tariffs and rate cuts - everything aligned for Risk On
3. Stocks, Bonds, Fx - High uncertainty as markets await the next moves from both the Fed and global policy developments
4. Crypto - Shitty vibes in Alts but Bitcoin holds on

The Macro Zeitgeist

Macro - CPI Ticking Higher, and so is Global Liquidity

CPI / PPI came in a bit higher and there was a big selloff in bonds (yields higher). While CPI was hot, it wasn’t hot enough to sustain higher yields, even as the Fed is firmly and indefinitely on hold. Yields have completely reversed and Mr Market is now trying to decipher potential impact of Elons cuts in Federal government. Would that be deflationary? No one knows just yet.

Meanwhile Liquidity remains in an upward trend but faces risks from:

• PBoC tightening and weak Fed liquidity growth.
• Central bank hesitancy in easing policies.
• Uncertainty around potential U.S. Treasury strategies, such as a gold revaluation.

Tariffs, Trade Wars, Bitcoin & the Gold Rush

Tariffs are already a thing of the past it seems. As Trump tip toes on his position, the effect of tariffs starts to diminish. On top, there seems to be a new threat everyday. If not Trump, then the step child Elon is out there cleansing it all. I came across something very funny today and put it on our telegram channel:

The Tik Tok and Twitter size short attention span brains are tired. market is also tired of tariff story. There is no more shock and awe, Trump and team know that. And so does Mr Market, which is not any more fearful.

While the effect of Tariffs is waning, and Tariffs were supposed to be a temporary tool, but now, they’ve become a full-fledged economic strategy. This is a “shoot first, aim never” moment for policymakers, and the outcome is clear:

Bitcoin and Gold aren’t just going up—they’re being catapulted to the moon.

Let’s unpack this chaos:

1. The U.S. Dollar: That Overconfident Friend Who Won’t Stop Borrowing Money

The U.S. dollar is like that one guy who insists on picking up the tab at dinner but secretly maxes out his credit cards to do it. That always comes with a catch:

• The world hoards USD and the U.S. runs a permanent trade deficit to keep everyone supplied.
• The government borrows money like it’s a TikTok trend, constantly testing the limits of sanity.
• Elon is trying to bring sanity but will be eventually crushed by the leftist and perhaps Trump himself at some point. Politics is a bitch.
• Trump has two great loves: reality TV and cheap money. And if Powell won’t give him low interest rates, then tariffs will have to do the trick.
• Tariffs force the Fed’s hand, making rate cuts more likely. The 10-year yield is heading down, whether Powell likes it or not.

Trump’s basically running Monopoly: Federal Reserve Edition—only instead of collecting $200 when passing "Go," he’s demanding quantitative easing and lower mortgage rates.

2. Bitcoin & Gold: The Escape Pods from Fiat Titanic

The U.S. dollar is taking on water, and smart money is grabbing a life vest and sprinting toward the Bitcoin & Gold lifeboats.

• U.S. assets might rally because, well, where else are you gonna park your money? China? Europe? The mattress?
• Foreign governments will print money like it’s Black Friday at the central bank, juicing inflation even more. They have no other way out either in a debt laden economy. Just look at Europe, China, Japan and the UK.
• Retail investors are done playing the fiat game. No one wants to hold a melting ice cube. As people in Turkey, Zimbabwe, Argentina, Pakistan etc

In the 1970s, if you wanted to escape currency debasement, you had to drive to a shady pawnshop and haggle over gold bars. Now? You just open Binance or Coinbase. Progress Sir.

The U.S. is actively weakening the dollar, like a bartender pouring you one-too-many shots. Foreign investors are fleeing their own failing economies—because the alternative is worse.

3. Then Comes the AI War: The Nerd Fight That Could Decide the Future

This isn’t just about trade deficits and currency wars. This is about who controls AI, the real power of the future.

• China is just few months behind the US in AI, ion not at par and definitely ahead in hardware (humanoids).
• The U.S. is throwing tariffs at the problem like a confused boomer with a bad internet connection.
• Whoever wins the AI race runs the world. Period.

Final Thought: The Playbook is a Meme at This Point

If you don’t see how this mess is sending Bitcoin to six figures, you’re not paying attention. The rules are simple:

?? Fiat weakens (RIP, dollar). I can’t put a timeline on this ?? Bitcoin & Gold moon (we’re going orbital) ?? Volatility is the price of admission (buckle up, buttercup).

Welcome to the new world order: inflation, tariffs, and Bitcoin dominance. See you on-chain. ??

GLOBAL MARKETS

Xi, Putin, Trump - Nothing Else Matters

• Chinese stocks seem to be taking a breather kicked off by some lead in the AI race by Deepseek and now Alibaba, and the fact that Xi seems to have given up his social agenda in favour of capitalism. We could see massive stimulus once USD/Yuan stabilises a bit IMO.

• Putin and Trump are pushing Zelensky to agree a truce which is very positive for Europe in general and Eastern Europe (Poland, Hungary specifically)

DATA TO WATCH

• February 18 - FTX Preliminary Distribution Repayments Begin
• February 28 - BTC CME February (BTCG25) Options Expiry
• March 19 - U.S. FOMC Interest Rate Decision
• March 28 - BTC CME March (BTCH25) Options Expiry

MACRO SUMMARY

All roads lead to long term Bitcoin and Gold Bulls

STOCKS, BONDS & FX

Last time we said:

We are a few days after the inauguration. Markets reached ATH before risking off for FED’s next meeting on 29th. What next? Since macro looks healthy, earnings look good, deregulation coming and inflation under control, I retreat what I said above - 2025 should be a decent upside year. And remember, US equity markets are the most sought after equity markets. That is not changing soon. Moreover, I think Trump & Xi wan to reach a deal as soon as possible.

We underestimated that any peace deal between Russia and Ukraine could push Eastern Europe and EU upwards. And that is what is happening. Look at country ETF’s above.

Falling yields are hurting

• A Painful Squeeze for All The recent decline in yields has been a tough pill to swallow across the board. As we move forward, all eyes will be on the upcoming data, especially given the well-known seasonal quirks that typically produce stronger numbers in January and February—only to fizzle out shortly after, much like a New Year’s resolution at the gym.
• A Seasonality Fade Meets a Hiring Freeze This seasonal pullback is likely to align with job cuts at DOGE and waning business confidence. Companies are hesitant to commit capital when the economic rulebook feels like a work in progress. Investing in such an environment is like trying to drive full speed on a road with ever-changing traffic laws—most will simply hit the brakes.
• The Sweet Lure of Tax Cuts & Deregulation While the promise of tax cuts and deregulation shines like a candy store on the horizon, the short-term reality is less appetizing. With the government stepping back as a primary engine of GDP growth, investors are left grappling with uncertainty—and if markets despise one thing more than bad news, it’s unpredictability.
• Markets Have Already Done the Math The anticipated benefits of deregulation aren’t exactly breaking news. Much of the upside has already been priced in, as evidenced by XLF (the U.S. bank ETF), which has been reflecting investor sentiment for some time. In other words, the cake has already been baked—now we just wait to see if it tastes as sweet as expected.

The USD is Struggling

1. The USD’s Balancing Act Is Wobbling The U.S. dollar has been a dominant force in global markets, but a combination of factors—like stagnation in tariffs, steady economic data, and the Federal Reserve's reluctance to raise rates—could reduce its strength. The global equity market outperformance further compounds this, as investors might look to diversify and seek returns outside of the U.S. This could signal a broader trend where the USD's role as a safe haven or preferred currency starts to diminish, with other markets potentially gaining more traction. How do you think this will play out? Do you foresee a stronger push toward alternatives like the euro or emerging market currencies?
2. USD Bulls Are Like Marathon Runners Without a Water Station Just like the bullish sentiment around the USD post-Trump didn’t last due to the lack of follow-through on policy actions, we're seeing a similar challenge now. Without a consistent flow of favorable data or a major crisis in Europe to push the USD higher, the dollar’s current strength seems unsustainable. Traders will likely be less inclined to stay long if they don’t see catalysts to justify holding those positions. If the DXY (Dollar Index) does begin to struggle, we could see a shift toward risk-on assets or alternative safe havens, especially if Europe and other regions manage to sustain stronger growth or offer more attractive returns.
3. Geopolitics Is Adding Another Headwind The potential resolution of the Russia-Ukraine conflict could be a major turning point for the USD, especially as it could drive capital into the European currencies you mentioned. If the conflict moves toward a resolution, it could ease some geopolitical risks, potentially benefiting the euro and currencies of countries more directly tied to the European Union. A shift in sentiment could cause further outflows from the dollar as investors start looking more favorably on European assets.

CRYPTO

CRYPTO TL;DR

• Liquidity is Improving, But QE is Inevitable While liquidity has shown modest improvement this week, central banks remain hesitant to pull the quantitative easing (QE) trigger—for now. Make no mistake, though, it's coming. Whether in three months or twelve, the sheer weight of global debt leaves them with no alternative but to monetize their way out. And let’s be honest—DOGE and Elon won’t be enough to rescue the system.
• Choppy February, Reversal on the Horizon My base case remains unchanged: February will continue to be volatile, but a meaningful reversal is likely toward the end of the month or in early March.
• A Healthy Crypto Correction This pullback in crypto markets is both expected and necessary. It’s a classic case of weak hands capitulating to stronger ones, flushing out excess leverage. Think of it as spring cleaning—some desks needed shaking, and over leveraged players needed a reality check.
• Smart Money is Moving Toward Gold & Bitcoin Regardless of short-term volatility, institutional capital is shifting aggressively toward a Gold & Bitcoin paradigm. I’ve discussed this extensively on Telegram & LinkedIn, and the trend remains clear.
• Key Bitcoin Levels & Strategy

Despite the current retracement, we have yet to see a 30% correction, and I don’t expect one in February or March. Bulls are already stepping in, and the stage is set for the next big move. ??

CRYPTO SENTIMENT - BAD BAD VIBES

The Evolution (or Devolution) of Crypto Movement: From Revolution to Racket

1. High Hopes, Measured Reality The crypto community had sky-high expectations for Trump, especially given his flurry of Executive Orders. However, most of these centered around a "Digital Assets Framework" rather than the sweeping pro-crypto reforms many had imagined. Did people really think he’d declare a Bitcoin Strategic Reserve on day one? Let’s be serious—that’s what the working group will be shaping over the next 180 days.
2. Bitcoin Holding Strong Despite the initial letdown, the fact that BTC is still hovering around $97K is, in itself, an impressive feat. Given the macro landscape, this level of resilience speaks volumes about the market’s underlying strength.
3. Rogue Meme Coins Steal the Spotlight Unfortunately, much of the enthusiasm was drowned out by the chaos surrounding $TRUMP & $MELANIA—the so-called "rogue couple" of the meme coin world. Billions in liquidity were siphoned from the market, leaving traders frustrated and liquidity pools looking like a post-rugged battlefield.

While the immediate hype cycle may have been a rollercoaster, the structural shifts in policy and institutional positioning remain the real story. The next 180 days will be crucial in shaping the regulatory landscape for digital assets. Stay tuned.

1. Grifters Gone Mainstream The crypto market has officially entered its reality TV era. Grifters were already circling, but Trump’s actions just gave them legitimacy. $TRUMP & $MELANIA drained liquidity from the market, effectively snuffing out the memecoin and AI hype cycles. Now, we’re witnessing an arms race where celebrities, CEOs, and politicians scramble to launch their own tokens—desperate for their next 15 minutes of blockchain fame.
2. From Innovation to Exploitation Looking back at Bitcoin’s early days (2013) or even the Ethereum ICO boom, at least there was an attempt to build something real. Today? It’s a free-for-all of openly orchestrated scams, with the U.S. presidency seemingly giving a green light. What could possibly go wrong?
3. Decentralization is Dead; Liquidity is the Target The ethos of decentralization and financial revolution has been discarded in favor of a well-coordinated liquidity drain, disguised as “community” and “fun.” CEOs, KOLs, political figures, corporate insiders, and even first ladies are playing the same game—rugging retail investors and siphoning billions from the market. By some estimates, over $5 billion has already been extracted from on-chain memecoins alone.
4. Memecoin Cycles: From Months to Minutes The memecoin hype cycles have collapsed from four months to four weeks, then to four hours, and now just four minutes. Best of luck keeping up. Solana has fully embraced its identity as the casino of crypto, but unless they adapt, emerging chains like Hyperliquid could steal their thunder. We’re betting on both, as our readers already know.
5. Real Builders Are Losing the War Actual builders can’t compete in this environment. They spend years developing products, only to see their tokens obliterated by a pump-and-dump cycle that erases both funding and credibility overnight. Meanwhile, VCs aren’t backing true innovation—they're busy farming the next L1/L2 narrative, pocketing their 5-10x, and exiting unscathed. Look at Berachain and IP Protocol—hyped-up nonsense, yet insiders happily take their slice at $300M, $500M, or even $1B FDV, knowing they’ll list at $5B+. If you’re not playing that game, you’re either shutting down or grifting memecoins in a hyperactive casino.
6. The Binance vs. Coinbase Absurdity Even CZ seems cornered, forced into memecoin shilling as $HYPE threatens to eat both Binance’s and Coinbase’s lunch. When Brian Armstrong starts acknowledging memes, you know we’ve crossed into the absurd.
7. The Only Constant: Bitcoin Through all this madness, Bitcoin remains the anchor. I’m not a BTC maxi, but in times like these, being one feels like the smartest move. With global liquidity expanding, Executive Orders taking shape, and regulatory clarity on the horizon, the case for Bitcoin and top-tier assets has never been stronger. Bitcoin is in a league of its own, with strong institutional support. The U.S. government won’t buy it directly, but they’ll create conditions that make everyone else want to. Expect higher prices this year—but not $200K.

From that perspective, January was overwhelmingly positive—even if the Trump memecoin grift stole the headlines.

OTHER CRYPTO OBSERVATIONS

1. SOLANA Unlock schedule - this is the last massive SOL unlock. My spidey senses tell me that this will be accompanied by some good news. Perhaps SOL ETF. So that there is less sell pressure. Also keep in mind, a lot of this is also hedged / already sold in OTC markets. Also it will be very corrected like before. Not just one massive dump.

2. New Filed ETF Requests

3. Hedge Fund Millennium Invests $2.6B in #Bitcoin and $182M in Ethereum ETFs.

4. Goldman Sachs Increases Bitcoin ETF Holdings to $1.27 Billion in Q4 2024

5. Make Fundamentals Great Again

CONCLUDING THOUGHTS - Bitcoin Rollercoaster Worth Riding

Whatever Bitcoin has planned for us in the coming weeks, I just can’t bring myself to lose sleep over it. Could we correct lower? Sure. But unless we see some financial apocalypse where Wall Street traders are bartering soy lattes for canned beans, I don’t see the bulls getting rattled anytime soon.

We’re talking aliens showing up, central banks getting hacked by AI, or the entire global economy deciding that fiat actually is a great store of value (spoiler: it’s not) kind of scenario for BTC to dip to $50K again.

Bitcoin & Gold: The Cockroaches of Finance ??

No matter what happens, Bitcoin and Gold are the best-positioned assets for the world that’s unfolding before us. They’re like cockroaches in a nuclear fallout—resilient, indestructible, and impossible to kill. When traditional markets freak out over interest rates, government debt, and trade wars, these two assets just keep chugging along, unbothered like a Zen master who’s seen it all.

Markets Are a Process, Not a TikTok Trend ?

The problem? People expect markets to move on their schedule, as if Bitcoin should check their Google Calendar before making a move. But markets don’t care about your timeline. They exist to humble the impatient, liquidate the overleveraged, and reward those who understand the game.

The reality is simple: every cycle, weak hands get shaken out like a pi?ata at a kid’s birthday party. Their coins? Well, they become our opportunity. And in this grand game of musical chairs, only the patient and prepared get to sit down when the music stops.

So, is the top in? Has the bull market run its course? Will Bitcoin collapse under its own weight? Not even close.

May your Monday be filled with coffee & profits.

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