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Cryptos Win the Pennant!

Bitcoin cracked through the psychologically important $30K support level recently but quickly bounced back up. Is this BTC on its way back up or will $30 be retested on the way down. El Salvador legalizes Bitcoin as legal tender and folks claim it was the shot heard around the world. Let’s delve deeper into the crypto incursion.

Giant’s Bobby Thomson famous 1951 homer known as the “Shot Heard Around the World”

It was the bottom of the ninth with runners on 2nd and 3rd, the former being the potential tying run. You can cut through the dense anxiety in the air as far as this was the first nationally televised baseball game and was even broadcasted by radio to Korea for the US servicemen.

Giants third baseman Bobby Thomson comes up to the plate and goes through the routine of banging on his cleats with his bat before digging into the batter’s box. Meanwhile Dodgers pitcher, Ralph Branca stares down for the signs from his catcher before going through the windup. Little did they know, their names would be forever intertwined in one of the most dramatic moments in sports history.

And with one swing of the bat, the now famous call came:

“There’s a long drive…The Giants win the pennant! The Giants win the pennant! The Giants win the pennant! The Giants win the pennant!”

And that was the “Shot Heard Round the World.” But history never stands still and recently and more recently El Salvador’s adoption of Bitcoin as legal tender was referred to as the latest shot heard around the world.¹ I would rather not see the term be overused and diluted, and notwithstanding that there were no shots of any kind involved, it was not unexpected and not such big news. In fact, it barely moved Bitcoin prices that day.

Nevertheless, cryptos are making big strides and there is no denial that the major cryptos are a legitimate asset class that is still undergoing rapid adoption.

Cryptos are Firmly Intertwined with Traditional Finance

it is difficult to imagine how there can be a direct link between the fluctuations of Bitcoin and the movements of the global financial market. Typically, crypto prices are driven by obscure factors like tweets from Bitcoin enthusiast Elon Musk, whose electric vehicle maker Tesla bought large quantities of the tokens. Price shifts in highly speculative cryptocurrencies rarely or never affect regulated and established markets.

One area that I have noticed is an increasing correlation between cryptos and traditional asset classes, such as equities (stocks) as evidenced by the chart below.

Bitcoin (top) is highly correlated to the S&P 500

The chart clearly demonstrates an established a statistical relationship between different assets in an economy, which in this case is US Index Futures and Bitcoin. So now suddenly Bitcoin is a bona fide asset class. Cryptos are still no new, it’s difficult to establish the correlation of cryptocurrencies to other assets within the broader economy. And let me stress again, the chart should not be used as price prediction, as the correlation can change at any time. Again it because of the newness of crypto and its adoption is not fully completed yet. My rough estimates based on global wealth totals and crypto market cap is 10% of the way — significant but nowhere close to completion. And during adoption phase, the volatility will make such correlations very erratic.

But many say, myself included, that Bitcoin is better correlated with gold, and in fact often referred to as 2.0 of the aforementioned precious metal. But I suspect a lot of crypto enthusiasts, especially Bitcoin, are merely finding a valid use case for Bitcoin. Or in other words, wishful thinking. This is because Bitcoin is simply not a good form of money due to its volatility, and that it is not widely accepted as payment for goods and services yet. But it can be a good store of value, and a “safe haven” during times of uncertainty. And in fact, we saw this happen in early 2020 at the start of the pandemic when gold started rising and Bitcoin went from $7k to break the $10k mark before settling in the $9k range and it broke its correlation with gold.

The important point is that cryptos, and most of all Bitcoin and Ethereum, have been solidly accepted into financial world. Regardless of your personal opinion on cryptocurrency, Aubrey Strobel of Lolli, eloquently summed it up, “In the same week, the world’s most progressive company, Tesla, and America’s oldest bank, BNY Mellon³, have added bitcoin to their business models. It’s no longer a matter of if institutions will adopt bitcoin, it’s a matter of when. One by one, institutional investors are validating the intuitive value and underlying logic of bitcoin.” Despite all the news and you consider that the cryptos market cap is at about $1.5T while global assets are at $360T², then one can consider that the crypto train has barely left the station.

If you look at the history of gold and silver, while Europeans valued gold, the Chinese valued silver. It took a few hundred years of trade and arbitrage before banks became involved and stabilized precious metal prices with fixed rates across Eufrasia. The Jews aptly took advantage of that and became monetary middlemen, hence the popular Jewish surnames of Goldman, Silverstein, Diamond, etc. while I am expecting to meet a Bitcoinstein or an Ethereum at my local synagogue. That would be a clear and unmistakable sign of divine crypto confirmation.

Crypto Naysayers Remain

Anti-crypto pundits still remain. Fellow tribe member, and renowned Nobel laureate economist, Paul Krugman recently opined⁴ that Bitcoin, being in existence for more than 10 years, still play no economic role and that 12 years is an eon in technological innovation. Except Bitcoin uses technology, but it is based on technology alone, rather it is a monetary innovation, which I have cited many times before has been evolving for thousands of years.

Paul also cites that normal, law-abiding people don’t use cryptocurrency, leaving it as the de facto currency of money launderers and drug dealers. This is abjectly false as crypto firms subject their clients to extensive KYC processes.

Bitcoin is not a good vehicle for money laundering as all transactions are immutable. Yes, there are mixers that can obfuscate, but if regulators believe that this is an issue, it will crack down by subpoenaing mixer records. And it is a known fact that most laundry operations are done through big global banks, which have been fined billions of dollars, which they gladly pay as the cost of doing business. Just watch Netflix’s Ozark series on what a launderer has to go through. If cryptos were so easy, there would be NO series as it would be just a no-brainer operation.


In conclusion, there is no killing cryptos in one form or another. Yes, something drastic theoretically can happen, like a large comet of 99.999% fine gold can crash onto the planet can devalue the price of gold. But then life on earth would be wiped out.

Traditional finance and cryptos are now intertwined and will be increasingly doing so, which is a good thing. I still have a lot of respect for Paul Krugman but he is from a different era who simply are not getting it, and therefore is eliciting every progressive crypto event as “Shot Heard Around the World.”

The struggle continues but the war is over. I look forward to more crypto progress and collaboration between the old and the new. Stay tuned and be safe.


  1. El Salvador looks to become the world’s first country to adopt bitcoin as legal tender
  2. All of the World’s Wealth in One Visualization
  3. Bitcoin Welcomes Tesla, Mastercard, BNY Mellon, Venmo To The Cryptocurrency Party
  4. Technobabble, Libertarian Derp and Bitcoin



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Edward Wong

Edward Wong

Co-founder QuantDart. Co-founder Shanghai Futures Exchange. Former Treasury Architect at the Federal Reserve. World Champion Spicy Eater. Cat lady.