We can be all doom and gloom about the market, which is in rough shape right now. Or, we can embrace that one thing finally brought us all back together and that’s Sam Bankman-Fried.

How the former CEO of FTX managed to get access to his X account is still unknown, but he wasted no time opining on why it’s tough to fire people and they shouldn’t be kept around “doing nothing.” 

Ironic, if you ask us, given that Bankman-Fried was out the door as FTX employees dealt with the consequences of the multibillion-dollar fraud he committed. Oh, and that he still uses @SBF_FTX as his X handle. 

Elsewhere:

• BTC is down 7% in the past day after sliding to three-month lows of around $87,100 earlier this morning. Current price: $89,250.

• Stablecoin supplies on Avalanche and TON have fallen around 20% in the past week, to $1.7 billion and $1.04 billion, respectively.

• Ordinals make up nearly 50% of weekly bitcoin transactions right now, per Blockworks Research data.

🦋 The Saylor Effect

Strategy’s Michael Saylor has had a busy start to the year, between his company buying $2 billion more bitcoin — meaning Strategy now holds nearly 500,000 BTC — and meeting with the SEC’s shiny Crypto Task Force. 

While the former is good for bitcoin, even with the current market falling apart (but David’ll get more into that), I want to focus on the latter today. 

Yesterday, my colleague Eleanor Terrett broke the news that Saylor had swung by the SEC’s offices to chitchat with Commissioner Hester Peirce’s new task force, and we — thanks to Saylor himself — now have an idea of what they focused on. 

The framework includes definitions for digital asset classes, establishing responsibilities that focus on efficiency and innovation. It also outlines potential gains for the US if it embraces crypto and ensures fair regulation. 

Some of the talking points — like a strategic bitcoin reserve and industry-led compliance — are topics we’ve talked about before and shouldn’t be a huge surprise. 

But Saylor is showing an interesting tactic here: Not only is he focused on ensuring that Strategy continues to build up its bitcoin treasury (which has helped to keep the price of bitcoin elevated despite the rest of the market meltdown we’ve seen, one could argue), he’s also now bringing ideas directly to the SEC about how to regulate the broader crypto market.

I caught up with Anthony Tu-Sekine, head of Seward & Kissel’s blockchain and crypto group yesterday and he was most interested by Saylor’s taxonomy section. 

It’s the most “concrete” proposal of the entire framework, Tu-Sekine noted, and that’s what lawyers are looking for. Even with a more friendly SEC, some of the overhang from the last administration hasn’t been removed and won’t be remedied by dropped investigations and cases into the likes of Coinbase and Robinhood, for example. 

Let’s take a quick look at Kaito: One of the questions left over from the token drop is whether or not it’s legal for a centralized company to pursue that type of activity. Tu-Sekine says the tricky part is that it’s still unclear. One could make an argument for both cases, he noted. 

Tu-Sekine told me he was looking at Saylor’s proposal from a “practical perspective.” 

“Policy goals are great, but they’re meaningless until somebody actually tries to write some sort of rules and a complete proposal.”

The definitions would mark the first step in giving the industry more actionable clarity, and I’d personally argue we see a little bit more of that in Saylor’s compliance section. 

If you need some sort of silver lining amid these market conditions, this very well may be a good one to look at. 

With this proposal, Saylor’s kicking off the conversations we’ve been trying to have for years now. And it’s clear from the SEC’s docket that he’s not the only one. Robinhood and the Crypto Council for Innovation (which includes reps from heavy hitters like Coinbase) have also met with the SEC. 

Now we just need to see some movement.

— Katherine

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• Something to celebrate: US law enforcement confiscated $31 million of crypto believed to be tied to the 2021 Uranium Finance hack.  

• Despite not being very pro-crypto in the past, Citadel Securities is looking to jump into crypto trading.  

• OKX settled with the US Department of Justice, agreeing to pay an $84 million fine and $421 million in restitution after it was found to have operated as a money transmitter without a license.

🎲 Roulette me down easy

By this point in the previous bull market, bitcoin was well on its way to its first cycle top.

Those peaks are always obvious in retrospect. Bitcoin had exploded from $10,000 to more than $60,000 in six months. Looking back, the market was overdue for a correction, and bitcoin retraced by around 50% over the next eight weeks.

This leads us to the obvious question today: Is this sea of red the start of a similar correction?

Below plots bitcoin price action over the bull market to date in purple (starting at the bottom of the previous bear market in November 2022), compared to the bull market returns from the cycle that ran from 2018 to 2022.

Usually, I include a chart on a log scale that maps returns going back to 2015. This time around, the chart is on a linear scale and only compares this cycle to the previous one. 

(You can find an interactive version of the chart here, where you can choose what you see by clicking on the swatches.)

If the current retracement is in fact the early stages of a 50%-plus correction, then it would be starting around 40 days earlier than the last time. Which I suppose wouldn’t be out of the ordinary.

Perhaps, it might be better to just get the correction out of the way — if there’s indeed enough momentum on the other side of it to drive it back to new highs, like there was in mid-to-late 2021.

One problem. That only covers bitcoin. A 50% correction in BTC has historically dragged other coins down much further, which would be painful considering how dire the vibes are right now.

In searching for positive, there’s this: We are now entering the eighth week of 2025. The altcoin market — all coins that aren’t in the top 10 by market cap — has posted negative returns for all but two weeks.

That is an incredibly low strike rate of only 25% if we count the current week that started on Monday as a red candle. 

At its worst over the past 10 years, the altcoin market has posted positive weekly returns 42% of the time, and that was in 2022 during the depths of the longest bear market on record. 

So, if anything, as rough as the market is right now, it still looks like the calm before a storm of volatility in both directions. Hooray.

— David

On our minds: Crypto exchanges