OVERVIEW

Everyone Watching The Same Cliff Edge 👀

Here’s What’s Happening 👇️

Today’s top trending tickers: $NIGHT ( ▼ 2.22% ) , $BASED ( ▲ 0.05% ) , $ELON ( ▲ 4.87% ) , $ATOM ( ▲ 3.43% ) , and $TAO ( ▲ 0.24% )

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NEWS
Report: Binance Given Two Weeks To Exit 27 Countries, Plenty Of Time 🤔

Per Reuters: Binance, the largest crypto exchange on the planet, is reportedly about to get shown the door in the European Union. Reuters says Greece’s market regulator is set to reject Binance’s bid for a license under MiCA, the EU’s crypto rulebook.

Miss that license and Binance loses the right to serve clients across all 27 member states when MiCA’s transitional period ends July 1. That’s a couple of weeks away.

Binance filed in Greece, a regulator that had approved exactly zero MiCA licenses, while Germany had handed out more than 45 and the Netherlands 22. It was believed, at least in February, that Greece offered a friendly, fast home base. And now it looks mostly like a coin flip to get EU thumbs up that, so far, are showing no thumbs.

I mean, none of this came out of nowhere. France’s regulators had already flagged Binance as unlicensed and poked at its risk controls, and the 2023 baggage ($4.3 billion US settlement, CZ getting the boot) lingers.

For EU users, “not good” is literal: come July, access, deposits, and withdrawals could get complicated. For Coinbase and Kraken, both already MiCA-licensed, it’s a gift-wrapped pile of orphaned customers.

NEWS
Money, Now With Extra Steps 🤦

$STT ( ▲ 2.34% ) came out with a Stablecoin Reserves Money Market Fund (SSCXX). Which sounds like a nothing burger until you walk down the path of how this thing got created/is created.

1. Hand a real dollar to a stablecoin issuer.

2. The issuer hands you a digital token worth one dollar.

3. The issuer takes your dollar and parks it in a money market fund.

4. The fund buys US government paper, which is itself a promise to pay dollars.

5. That paper throws off interest. The issuer keeps the interest.

6. You keep the token.

State Street just launched the fund that sits in the middle of that loop. The SSCXX is a Rule 2a-7 government money market fund now rebranded for “tokenization innovation” and targeted to stablecoin issuers who need somewhere to stash their reserves.

When you think about the process, it is kind of funny: real money was digitized into a different money, backed by a fund full of money, so the fund can make money – for the issuer and for State Street, which collects fees on the float.

TECHNICAL ANALYSIS
The Scariest Chart In The World 😨

Nope, you didn’t open the wrong newsletter. Still Cryptotwits. But with a new Fed chair coming up to bat tomorrow and the Yen sitting at ‘please no’ levels, it’s important to look at this chart.

Yen Index Monthly Chart – Click to enlarge.

The scariest chart in the world right now is not on your crypto screen. It is the Japanese Yen Index, ticker JXY, sitting around 62. If it goes where it can go, it does not just hurt Tokyo. It grabs everything you own by the throat, your bags included.

The Yen Swims With Everything

For two decades Japan has run the cheapest money on Earth. Traders grew up borrowing yen for nothing and parking it in anything that yields more: US tech, Mexican bonds, Australian dollars, risk of every flavor.

That is the carry trade, and it is enormous. Nobody knows the true size; it depends who you read/ask/watch. The narrow, on-balance-sheet version the BIS tracks is around 250 billion dollars (probably because, well, it’s not as scary as what you’ll read next).

The speculative, fast-money version runs closer to 500 billion. The broadest framing, from a top $DB ( ▲ 1.1% ) strategist, is that Japan’s whole balance sheet is “one giant carry trade” worth something like 20 trillion dollars, about 500 percent of GDP.

Pick whichever number you like. Cheap yen has financed the global risk party for twenty years, and when its cost changes fast, it catches fire.

So.. What If 62 Fails?

This is where things get interesting, and Elliot Wave Theory is great for this. Without getting into the nitty-grity, there are three primary scenarios we could look at.

Scenario 1: still inside wave 5 (continuation, moderate)

Yen Index Monthly Chart – Click to enlarge.

This scenarior assumes July 2024 was the end of wave 3, the run to 70.06 was wave 4, and wave 5 is grinding lower right now. Targets are the ones we mapped: primary around 52, extension around 48, hard floor at 44.75 (wave 3 came in shorter than wave 1, so wave 5 cannot exceed wave 3 without making wave 3 the shortest and breaking the rule).

Scenario 2: the impulse already finished at 61.75, and the larger decline is just starting (continuation, deep)

Yen Index Monthly Chart – Click to enlarge.

This scenario assumes the whole 2012 sequence completed five waves at the July 2024 low. Everything since is a correction: up to 70.06, then back to 62.33. If that rally counts as a three, the five waves get demoted to wave 1 (or A) of one higher degree, the bounce was wave 2 (or B), and we are now entering wave 3 (or C) of the bigger structure.

A decisive break below 61.75 confirms it, and the targets are no longer 52 to 48. They get measured off the larger move and point materially lower, into the 40s or below. This is the version that makes the scariest-chart case loudest.

Scenario 3: the decline is done and the yen reverses (the snapback) 

Yen Index Monthly Chart – Click to enlarge.

Same premise as Scenario 2, impulse complete at 61.75, but the 61.75 to 70.06 rally counts as a clean five up instead of a three. That marks 61.75 as a major bottom and the start of a larger corrective advance, meaning yen strength from here.

The drop to 62.33 would be a wave 2 pullback that holds above 61.75, then an impulsive push back through 70.06 toward the 78 to 80 zone. Take this one seriously, because it is the Elliott signature of the violent carry unwind.

Tomorrow, we’ll get into some of the scenarios of what would happen if the poo hits the oscillating blades scenario for the Yen.

TECHNICAL ANALYSIS
The Beautiful Game Theory: A Cross-Asset Framework For Futball-Derived Alpha In Digital Asset Markets

Working paper. Cryptotwits Quantitative Research Division (n=1). Not yet submitted, will not be submitted, peer review declined preemptively. God help you if this is the first newsletter you’ve read because this is not a serious analysis, but welcome anyway. This is satire, but also real correlations. Is that satire-ish then? Anyway…

So… the Yen story was all sorts of fun, right? Let’s talk about something fun-ny.

I believe I’ve come across a previously unrecognized class of leading indicators sourced entirely from futball statistics and their explanatory power across four canonical pillars of digital assets: store of value, smart-contract settlement layer, network dominance, and the speculative long tail.

I contend these relationships are not artifacts of small samples or shared seasonality but evidence-ish of a deep-ish structural-ish coupling between football and crypto price action and/or on-chain activity.

Goalless Hegemony

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$BTC ( ▲ 0.09% )  dominance tracks England draws per year at r of 0.80 across eleven seasons. Both measure the same thing, which is a refusal to let anyone else have a moment. England grinds out a nil-nil in Bratislava and somewhere an altcoin gives back a week of gains.

The Three Lions have been long BTC since the Sven era. 

Then Seleção Standard

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BTC year-end close against Brazil’s win rate, r of 0.81. Brazil is the store-of-value team. Five stars, an infinite supply of talent, sold to every fan on earth as the asset that cannot fail. And like Bitcoin, the whole edifice sits one bad afternoon away from a 7-1.

The Understated Genius Index

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$ADA ( ▼ 1.64% )  against Messi assists, r of 0.74, the weakest number in the set. Both do their work while the camera is on somebody else. Messi slides a no-look ball through in the eighty-second minute and three days later ADA prints a green candle nobody can explain. Coincidence?

The xG Burn

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$ETH ( ▲ 1.02% )  season-end close against Champions League goals, r of 0.77. Every goal is a deflationary event. The ball crosses the line, a defender’s confidence is removed from circulation forever, and net supply tightens. EIP-1559 did not invent the burn. Didier Drogba did. The Merge was just Europe finally adopting a striker-led ETH monetary policy.

OLD NEWS
Crypto Stuff That Happened Today, But A Long Time Ago 📜

Here’s what was happening in the newsletter a year ago today:

• Justin Sun pulled a reverse-merger stunt – stuffing up to $210M in TRX into a dead toy company shell to sneak Tron onto Nasdaq.

• SRM went completely feral on the headline – opening up roughly 289% and at one point ripping as much as 633% intraday.

• The other notable angle was regulation thaw – Paul Atkins was pitching a more predictable SEC with actual crypto rulemaking instead of the usual random-bat-swing approach.

OLD NEWS
Other Stuff That Happened Today, But A Long Ass Time Ago ⌛️

June 16

• 1487: Henry VII crushes the Lambert Simnel rebellion at Stoke Field and ends the Wars of the Roses.

• 1815: Napoleon beats the Prussians at Ligny, 48 hours before Waterloo ends him.

• 1858: Lincoln’s “House Divided” speech warns the Union can’t stay half-slave, half-free.

• 1903: Ford Motor Company is incorporated in Detroit.

• 1911: The firm that becomes IBM is founded out of scales, slicers, and punch cards.

• 1940: Pétain takes power as France collapses toward armistice.

• 1960: Hitchcock’s Psycho opens in New York.

• 1961: Ballet star Rudolf Nureyev defects from the USSR at a Paris airport.

• 1963: Valentina Tereshkova becomes the first woman in space.

• 2012: Liu Yang becomes China’s first woman in space, 49 years to the day after Tereshkova.

• 2020: North Korea blows up the inter-Korean liaison office in Kaesong.

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