Bitcoin

Preston Pysh Explains Why SAB 121 Beats a Strategic Bitcoin Reserve

Published

2 months ago

January 29, 2025

In the rapidly evolving world of Bitcoin adoption, few regulatory shifts carry the magnitude of SAB 121’s recent rescission. According to prominent Bitcoin advocate and investor Preston Pysh, this development is a watershed moment that could have more far-reaching implications than even the much-debated concept of a Strategic Bitcoin Reserve.

My thoughts on the two biggest things that happened last week w/ Bitcoin.
SAB121 and the in-kind redemption request to the SEC pic.twitter.com/XyHDiNcOvH
— Preston Pysh (@PrestonPysh) January 27, 2025

Who is Preston Pysh?

Preston Pysh is a General Partner at Ego Death Capital, a Bitcoin-focused investment firm. Known for his expertise in finance, macroeconomics, and Bitcoin, Pysh is also the founder of The Investor’s Podcast Network. With his deep understanding of traditional financial systems and Bitcoin’s transformative potential, Pysh is a leading voice in the Bitcoin community.

What Was SAB 121?

SAB 121 (Staff Accounting Bulletin 121), introduced during Gary Gensler’s tenure at the SEC, imposed significant restrictions on financial institutions looking to custody Bitcoin. Under its guidelines, banks had to classify Bitcoin custody as a liability on their balance sheets. For every dollar’s worth of Bitcoin they held, they were required to offset it with an equivalent amount of capital—typically in treasuries or other assets.

The result? Institutional Bitcoin custody became economically prohibitive. Banks, wary of the capital-intensive requirements, opted out of offering Bitcoin-related services entirely.

However, the rescission of SAB 121 changes the game. Bitcoin custody is now treated as an asset, not a liability, dramatically lowering barriers for major banks like JPMorgan and others to enter the Bitcoin ecosystem. As Pysh notes, “All the major banking institutions are now wanting to take this on. There could be loan products, all sorts of things that can pop out of this.”

A New Era for Institutional Bitcoin Custody

Preston Pysh emphasizes that this regulatory shift could entrench Bitcoin as a cornerstone of global financial infrastructure. The implications are profound:

Broader Institutional Adoption: Banks can now custody Bitcoin without facing onerous balance sheet requirements. This paves the way for loan products, derivatives, and a host of other financial instruments tied to Bitcoin.
Enhanced Legitimacy: The willingness of major banks to custody Bitcoin signals a growing recognition of its role as a global settlement layer, further cementing its place in the financial system.
A Durable Framework: Unlike a Strategic Bitcoin Reserve, which could be subject to political whims and administrative changes, the rescission of SAB 121 creates a structural shift. “This entrenches Bitcoin as a global settlement layer, in my humble opinion,” Pysh explains, underscoring its long-term impact.

Why the Strategic Bitcoin Reserve Falls Short

While the idea of a Strategic Bitcoin Reserve—where governments accumulate Bitcoin as part of their national reserves—has captured the imagination of the Bitcoin community, Pysh suggests it lacks the permanence of SAB 121’s impact. Reserves can be subject to the priorities of the administration in power. A pro-Bitcoin government might amass reserves, only for a subsequent administration to reverse course.

In contrast, institutional adoption driven by the rescission of SAB 121 creates a systemic entrenchment. Large-scale integration by private banks and financial institutions is harder to unwind and more likely to persist across political cycles.

Addressing the Risks

Pysh acknowledges concerns about the centralization of Bitcoin custody among large institutions. Sovereign influence over custodial banks could raise questions about Bitcoin’s decentralization and the potential for misuse. However, he also points to mechanisms like BlackRock’s application for in-kind redemptions in its Bitcoin ETF as a counterbalance to such risks. “If this in-kind redemption is honored by the SEC, which I really hope it will, and I suspect it will be,” Pysh explains, “it would really offset the concern of rehypothecation happening with the custodians.”

Conclusion

The rescission of SAB 121 represents a monumental shift in Bitcoin’s journey toward mainstream adoption. By removing barriers for institutional custody, it paves the way for Bitcoin’s integration into the global financial system in a manner that is more enduring than government-led initiatives like a Strategic Bitcoin Reserve. As Preston Pysh, General Partner at Ego Death Capital, notes, this development entrenches Bitcoin as a global settlement layer and opens the door to a host of financial innovations.

The Bitcoin community must remain vigilant about the risks associated with institutional custody, but there’s no denying the bullish implications of this regulatory breakthrough. The next era of Bitcoin adoption has begun, and SAB 121’s rescission is leading the charge.

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Bitcoin

Bitcoin Price (BTC) Rises Ahead of President Trump Tariff Announcement

Published

3 hours ago

April 1, 2025

admin

Recently very shaky risk assets — crypto among them — are attempting a rally on Tuesday, perhaps. buoyed by chatter that Donald Trump’s tariffs won’t be as stringent as feared.

In early afternoon U.S. action, bitcoin (BTC) had climbed to just above $85,000, ahead 2.1% over the past 24 hours. Previously really roughed up crypto majors like ether (ETH), dogecoin (DOGE) and cardano (ADA) had put in gains of roughly twice that amount.

Crypto stocks are also performing well, with bitcoin miners Core Scientific (CORZ) and CleanSpark (CLSK) jumping almost 10% on the day. Strategy (MSTR) is up 5.4% and Coinbase (COIN) 2.1%.

U.S. stocks reversed early session losses to turn higher as well, with the Nasdaq now ahead just shy of 1% for the day.

The action comes ahead of the Trump administration’s so-called “Liberation Day” tariff rollout set for tomorrow after the close of U.S. trading.

Hope?

A report from NBC News suggested the market’s most feared option — blanket 20% tariffs across the board — is “less likely” to be the direction taken by the White House. Instead, according to the report, a “tiered system” of different rates or country-by-country rates could be announced.

Also maybe helping is what appears to be the first acknowledgement that the administration is aware of the market tumult resulting from all the tariff chatter. Speaking today at her daily briefing, White House Press Secretary Karoline Leavitt said that there were legitimate concerns about market swings.

Meanwhile, Israel’s Minister of Finance Bezalel Smotrich announced on Tuesday that a process had been launched to get rid of tariffs on U.S. imports in that country.

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Bitcoin And Altcoins Fischer Transform Indicator Turn Bearish For The First Time Since 2021

Published

5 hours ago

April 1, 2025

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Technical expert Tony Severino has warned that the Bitcoin and altcoins Fischer Transform indicator has flipped bearish for the first time since 2021. The analyst also revealed the implications of this development and how exactly it could impact these crypto assets.

Bitcoin And Altcoins Fischer Transform Indicator Turns Bearish

In an X post, Severino revealed that the total crypto market cap 12-week Fisher Transform has flipped bearish for the first time since December 2021. Before then, the indicator had flipped bearish in January 2018. In 2021 and 2018, the total crypto market cap dropped 66% and 82%, respectively. This provides a bearish outlook for Bitcoin and altcoins, suggesting they could suffer a massive crash soon enough.

In another X post, the technical expert revealed that Bitcoin’s 12-week Fischer Transform has also flipped bearish. Severino noted that this indicator converts prices into a Gaussian normal distribution to smooth out price data and filter out noise. In the process, it helps generate clear signals that help pinpoint major market turning points.

Severino asserted that this indicator on the 12-week timeframe has never missed a top or bottom call, indicating that Bitcoin and altcoins may have indeed topped out. The expert has been warning for a while now that the Bitcoin top might be in and that a massive crash could be on the horizon for the flagship crypto.

He recently alluded to the Elliott Wave Theory and market cycles to explain why he is no longer bullish on Bitcoin and altcoins. He also highlighted other indicators, such as the Parabolic SAR (Stop and Reverse) and Average Directional Index (ADX), to show that BTC’s bullish momentum is fading. The expert also warned that a sell signal could send BTC into a Supertrend DownTrend, with the flagship crypto dropping to as low as $22,000.

A Different Perspective For BTC

Crypto analyst Kevin Capital has provided a different perspective on Bitcoin’s price action. While noting that BTC is in a correctional phase, he affirmed that it will soon be over. Kevin Capital claimed that the question is not whether this phase will end. Instead, it is about how strong Bitcoin’s bounce will be and whether the flagship crypto will make new highs or record a lackluster lower high followed by a bear market.

The analyst added that Bitcoin’s price action when that time comes will also be trackable using other methods, such as money flow, macro fundamentals, and overall spot volume. The major focus is on the macro fundamentals as market participants look forward to Donald Trump’s much-anticipated reciprocal tariffs, which will be announced tomorrow.

At the time of writing, the Bitcoin price is trading at around $83,000, up around 1% in the last 24 hours, according to data from CoinMarketCap.

Featured image from Unsplash, chart from Tradingview.com

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Altcoins

279% Rally in 2025 for One Under-the-Radar Altcoin ‘Very Likely,’ According to Crypto Analyst

Published

7 hours ago

April 1, 2025

admin

A closely followed crypto strategist believes that the native asset of a layer-2 scaling solution could witness an over 3x rally this year.

Pseudonymous analyst Inmortal tells his 231,000 followers on the social media platform X that he’s bullish on Mantle (MNT), noting that he believes the altcoin has already printed a 2025 bottom at around $0.6.

According to the trader, a 279% rally for MNT this year is a high-probability scenario.

“Starting to feel like bottom is in.

Big players have been buying over the last few weeks, and it shows.

$3 in 2025 is very likely, high-conviction play for me.”

Based on the trader’s chart, he seems to predict that MNT will surge to $1.30 in the coming months.

At time of writing, MNT is worth $0.79.

Turning to Bitcoin, the trader unveils a potential path for BTC to print a durable bottom this year. According to Inmortal, BTC could temporarily drop below $70,000 before igniting the next stage of the bull market en route to a new all-time high of $135,000.

“They will try to shake you out, but this is the bottom.

Save the tweet.

BTC.”

At time of writing, BTC is trading for $82,374.

As for Ethereum, Inmortal predicts that the price of ETH may plummet below $1,500 before sparking a short-term rally toward $2,000.

“Expansions lead to retraces. Retraces lead to bounces.

Bounce soon.”

At time of writing, ETH is trading at $1,822.

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