Welcome to BRC’s Breakdown.

846 days. That’s how long Bitcoin took between November 9, 2021, to March 11 to hit a new all-time high. The funny thing is, four years ago, in March 2020, Bitcoin crashed below $5,000 during the Covid-19 crash.

First, let’s see how the markets fared this week:

Here’s a preview of what we’ll cover:

• Macro: Bullishness Is Everywhere

• Crypto: Bitcoin Now Trading At Fresh Peaks. New Themes Emerge.

• AI: AI In A Mess? Musk vs OpenAI, Google Fixing Gemini

• Week To Watch: US CPI and Japanese Wage Negotiations

Bullishness Is Everywhere

US Non-Farm Payrolls on Friday last week - Total nonfarm payroll employment rose by 275,000 in February, and the unemployment rate increased to 3.9 percent. There were revisions lower for December & January numbers by a total of 167,000 jobs.

The headline jobs number in the February employment report was above expectations. However, December and January payrolls were revised down by 167,000 combined. The participation rate was unchanged, the employment-population ratio decreased, and the unemployment rate increased to 3.9%.

Bond yields declined globally - with Japan remaining a stubborn exception. Japanese bond yields have steadily ticked higher this year and the 10-year yield has moved to 0.74%.

Bullishness was everywhere with US equities hitting new highs. Gold and Bitcoin have also hit new all-time highs - even as the rate cut expectations have been delayed.

Markets are pricing in the first US Fed rate cut in June with 2-3 cuts priced in for 2024. Given the strength in the economy, expectations for more cuts in 2025 have been decreasing with just 1 cut priced incrementally in 1st half of 2025.

To get a sense of how expectations have changed so far this year with the stronger economy. consider this – When the year started, expectations were for 4-5 cuts of 25 basis points each, with cuts starting in March. Versus 2-3 cuts starting in June 2024 that is the current expectation.

One important development in US equities this year is that the dispersion in returns of the Magnificent7 has increased. Year To Date Nvidia stock is up 77% while Tesla is down 29%. And on a YTD basis, 3 out of the Mag 7 are down even as Nasdaq is up 7% YTD.

Bitcoin Now Trading At Fresh Peaks. New Themes Emerge.

In a remarkable demonstration of its growing influence and acceptance, Bitcoin has recently surged to a record high of $72,000.

This significant leap in value is attributed to increased trading accessibility and a decline in the US dollar's strength. Furthermore, regulatory developments in key markets have paved the way for institutional investors to engage more deeply with the cryptocurrency space, notably through the introduction of Bitcoin ETFs.

These financial instruments have bridged the gap between traditional investment avenues and the world of digital currencies, signaling a maturation of the market.

The broader cryptocurrency ecosystem is also witnessing a phase of rapid evolution and expansion. New layer 1 blockchains and decentralized finance (DeFi) projects are continuously emerging, drawing attention to the sector's innovation potential.

The market is currently dominated by memecoins whose market crosses $40 billion surpassing many other sectors like . Meanwhile, the potential of additional Bitcoin ETF providers shortly will open the floodgates for funds to enter the crypto market. This would likely consequently lead to a larger boost in market cap. The community is closely watching Ethereum’s price due to ongoing speculation regarding the potential approval of the spot Ethereum ETF in May.

Even among the major cryptocurrencies, significant price bumps have been observed. Ethereum witnessed another spike this week, recording a 10% increase in price, while Bitcoin has surged by 8% over the past seven days.

AI In A Mess? Musk vs OpenAI, Google Fixing Gemini

In recent developments within the AI industry, several significant events have highlighted the ongoing transformation and growing tensions.

One major storyline involves Elon Musk's legal battle with OpenAI. Reports have surfaced that Musk, who played a pivotal role in the founding of OpenAI, has initiated legal action against the organization. He alleges a breach of their initial non-profit agreement, raising questions about the future direction and governance of the AI research company. This move came amidst rumors that Musk sought to either merge OpenAI with Tesla or gain full control over it, indicating potential shifts in how AI technologies might be integrated with existing businesses and products.

Meanwhile, the tech giants are not standing still. Microsoft has announced its decision to quadruple its AI cloud investment in Spain. This substantial financial commitment is indicative of the company's belief in the strategic importance of AI and cloud services, not just as technological frontiers but also as pivotal factors in global business operations and competition.

Google, on its part, has committed to addressing issues surrounding its Gemini AI system, which has been criticized for producing inaccurate and biased image generations. This pledge reflects the growing concern over ethical AI development and the tech industry's responsibility to ensure that their innovations do not perpetuate existing biases or create new forms of discrimination.

These developments underscore the dynamic and sometimes contentious nature of the AI industry. From legal disputes and strategic investments to ethical commitments, the landscape is rapidly evolving. Stakeholders are increasingly grappling with the implications of AI on society, governance, and the global economy, signaling a period of significant change and adaptation ahead.

Interesting Reads

Crypto ETFs: Now Near You

Thailand, which has historically not been pro-crypto, is turning a new lead. The country’s SEC recently okayed investments in Crypto ETFs by institutional investors. Read about it here.

Remember SVB? Some founders wouldn't.

Last time this year, one of America’s largest banks was collapsing. This led to tremors in the crypto landscape, with the second-largest stablecoin losing its peg. Find out how founders are adjusting a year later here.