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BytBit Crash Overblown?🔥 Crypto Market Update📉 · The Paul Barron Crypto Show

• 0:07
  Speaker 1: A lot of news coming in on the bybit hack. Today,
• 0:09
  Speaker 1: we're going to break it all down for you don't
• 0:11
  Speaker 1: miss it. My name is Paul Baron. Welcome back into
• 0:12
  Speaker 1: tech path. Let's get started. I do want to thank
• 0:15
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• 0:17
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• 0:20
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• 0:22
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• 0:24
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• 0:26
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• 0:30
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• 0:32
  Speaker 1: a business account. You can start two hundred bucks to
• 0:34
  Speaker 1: get started in crypto. And this is a place for
• 0:37
  Speaker 1: you guys to go. I think this obviously if you're
• 0:40
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• 0:42
  Speaker 1: it out coin bas dot com. Let's go over to
• 0:45
  Speaker 1: a couple of points I want to hit on, and
• 0:46
  Speaker 1: this is kind of the history of what we've seen.
• 0:49
  Speaker 1: Bybit hits a one point five billion dollars by far,
• 0:52
  Speaker 1: that's the largest hack financial hack in the history of
• 0:56
  Speaker 1: all financial crime. There has been one other hack that
• 0:59
  Speaker 1: occurved back in twenty fifteen in a European bank, but
• 1:02
  Speaker 1: it was done through like thirty different bran bank infrastructure
• 1:06
  Speaker 1: and they got over a billion dollars, but nothing even
• 1:09
  Speaker 1: close on that. Malcox twenty eleven six hundred and forty
• 1:12
  Speaker 1: seven thousand bitcoin about four hundred and seventy million at
• 1:15
  Speaker 1: the time, Bitfinexa course in sixteen, coinchet ftx was four
• 1:19
  Speaker 1: hundred and fifteen million, cou Coin, waza X which we
• 1:22
  Speaker 1: showed last year a two hundred thirty five million, and
• 1:25
  Speaker 1: then Quadraga, and then of course coinbing and Femix also
• 1:29
  Speaker 1: just happened here in twenty twenty five at sixty nine million.
• 1:32
  Speaker 1: So as you can see, these are continuous problems that occur.
• 1:36
  Speaker 1: The key is how did these companies respond to these things?
• 1:40
  Speaker 1: And with by Bit they did a pretty good job,
• 1:41
  Speaker 1: I think in being able to respond to it. And
• 1:44
  Speaker 1: if you look at this, this is a pretty good assessment.
• 1:47
  Speaker 1: If a bank were to be hacked at one point
• 1:49
  Speaker 1: four billion, you'd see a freeze of withdrawals. Government would
• 1:53
  Speaker 1: be involved, set up in query commission right now. You'd
• 1:55
  Speaker 1: probably see bank runs going like crazy, Branches would be closed,
• 1:58
  Speaker 1: competitors would be getting an advantage. I mean, it'd be crazy.
• 2:02
  Speaker 1: By Bit gets theirs done, CEO went live, the industry
• 2:07
  Speaker 1: kind of united to assist on some liquidity competitors, you know,
• 2:11
  Speaker 1: really started to show and I think that's the thing
• 2:13
  Speaker 1: with crypto, it shows a consistent support in the community itself.
• 2:17
  Speaker 1: The industry itself is tracking and freezing. That's the beautiful
• 2:21
  Speaker 1: thing about Crypto is that they were able to track
• 2:23
  Speaker 1: this down almost immediately and zero withdrawals were pinning, So
• 2:28
  Speaker 1: that's another big advantage. Very good if you look at this,
• 2:32
  Speaker 1: it's a bullish move overall for the industry. Now there's
• 2:36
  Speaker 1: a lot of people that have pointed to a lot
• 2:38
  Speaker 1: of different variations of how this may play out. But
• 2:41
  Speaker 1: by Bit of course has made an announcement and they're
• 2:44
  Speaker 1: almost back to one hundred percent on their ether reserves
• 2:48
  Speaker 1: and the deposits and withdrawals are back to normal. So
• 2:51
  Speaker 1: kudos for what they're doing there. But again, they did
• 2:53
  Speaker 1: a good job on damage control. I think Ben's you know,
• 2:58
  Speaker 1: going on a couple of U Tube shows and also
• 3:01
  Speaker 1: just the livestream was I think a good move in general,
• 3:04
  Speaker 1: because remember, you got to remember your audience. You have
• 3:06
  Speaker 1: to speak to the audience where they are go to
• 3:08
  Speaker 1: where they live, and I think this was a good
• 3:11
  Speaker 1: move overall. I was listening to some of the interviews
• 3:14
  Speaker 1: with Ben from Bybit, and a couple of things I
• 3:18
  Speaker 1: look at is, first of all, kudos to them, their
• 3:21
  Speaker 1: security layers were pretty advanced. And then I think is
• 3:26
  Speaker 1: the very bare minimum that you should have in place
• 3:29
  Speaker 1: for crypto just because of its nature of digital money
• 3:32
  Speaker 1: and how easy it's going to be. And remember you
• 3:34
  Speaker 1: have to look at a lot of these organizations, including
• 3:36
  Speaker 1: these centralized exchanges, are just getting into the cycle of security.
• 3:42
  Speaker 1: So having a full on security and forensics team this
• 3:46
  Speaker 1: is a thing that I would say, I'm a little
• 3:49
  Speaker 1: surprised that we don't have in a company of the
• 3:51
  Speaker 1: size of Bybit, even though you got zach XPT out
• 3:54
  Speaker 1: there doing a lot of unchained forensics. The likelihood is
• 3:58
  Speaker 1: is that you should have a team of zach x
• 4:00
  Speaker 1: be teased in every major exchange out there, being able
• 4:03
  Speaker 1: to do this one looking for vulnerabilities and two being
• 4:07
  Speaker 1: able to seize the moment in case a hack does occur,
• 4:10
  Speaker 1: so that you can go out there and possibly freeze wallets, etc.
• 4:13
  Speaker 1: Other things that we're going out out there. That is
• 4:15
  Speaker 1: a little bit concerning is that Binance is now beginning
• 4:18
  Speaker 1: to sell huge amounts of Ether and Solana, and of
• 4:21
  Speaker 1: course we've seen Solana's market start to plunge. We're down
• 4:24
  Speaker 1: around one fifty right now, which is pretty much erased
• 4:27
  Speaker 1: the entire Trump bump, and a lot of it is
• 4:30
  Speaker 1: coming from what's going on right now out of Binance.
• 4:32
  Speaker 1: There are other things. Yes, there's some scenarios that are
• 4:35
  Speaker 1: going to be playing out here in March in terms
• 4:38
  Speaker 1: of just reclaims, and I think what we're going to
• 4:41
  Speaker 1: see in a very short period of time with Solana
• 4:43
  Speaker 1: is either a bounce or we're going to see this
• 4:46
  Speaker 1: maybe make its way back down to one hundred dollars.
• 4:48
  Speaker 1: I don't know. Let me know down in the comments
• 4:49
  Speaker 1: of where you think Solana is going to be going
• 4:52
  Speaker 1: from here, I want to play a clip for you guys,
• 4:54
  Speaker 1: because this is going to get into what will it.
• 4:56
  Speaker 1: First of all, what was the the statement of where
• 5:02
  Speaker 1: traditional finance was Because they're looking in on what's happening
• 5:06
  Speaker 1: with the Binance deal, are the Bybit deal, And I
• 5:08
  Speaker 1: think this is a good statement from pomp on what
• 5:11
  Speaker 1: this means to crypto. Take a look.
• 5:13
  Speaker 2: Well, look, anytime that you have a hack. People will
• 5:15
  Speaker 2: obviously get worried about this, but the way that I
• 5:17
  Speaker 2: described the Treasury and the FED has never been hacked.
• 5:19
  Speaker 2: The further you get away from the creation of the
• 5:20
  Speaker 2: money point, then you get less secure. Banks have been hacked,
• 5:23
  Speaker 2: armored cars have been hacked, or people have had money
• 5:25
  Speaker 2: stolen from their wallet. Same thing in crypto. The blockchain itself,
• 5:28
  Speaker 2: the bitcoin blockchain has never been hacked. But if you
• 5:30
  Speaker 2: go and you take that, you put it in an exchange,
• 5:32
  Speaker 2: or you put it in some sort of custody solution,
• 5:33
  Speaker 2: those can get hacked. And so I think it's important
• 5:36
  Speaker 2: to pay attention to the most impressive part to me though,
• 5:38
  Speaker 2: was this is a one point four one point five
• 5:40
  Speaker 2: billion dollar hack. Customers obviously were worried. They ran to
• 5:43
  Speaker 2: the exchange. They withdrew four billion dollars, no problem, and
• 5:47
  Speaker 2: so obviously the exchange had the money. Usually what we've
• 5:50
  Speaker 2: seen is when these things happen, the exchange gets caught,
• 5:53
  Speaker 2: you know, not having the money or some sort of issue.
• 5:55
  Speaker 2: But I think that really the system kind of worked
• 5:57
  Speaker 2: how it was supposed to, and now they're going to
• 5:58
  Speaker 2: work to try to recover that one point for a
• 6:00
  Speaker 2: billions that were taken from.
• 6:01
  Speaker 1: The other thing that was kind of interesting was when
• 6:03
  Speaker 1: you listen to Ben his statements of how all this occurred.
• 6:09
  Speaker 1: It was pretty sophisticated in terms of how the North
• 6:13
  Speaker 1: Korean hackers did it, almost creating a new interface. MANE
• 6:17
  Speaker 1: think of it this way, almost like a skimmer on
• 6:19
  Speaker 1: You guys probably seen this, but imagine if you logged
• 6:21
  Speaker 1: into your bank account and it looked just like your
• 6:23
  Speaker 1: bank account had all the kind of narratives, even a
• 6:26
  Speaker 1: test run of deposits or an acch and that goes through,
• 6:30
  Speaker 1: and yet at the same time it is essentially the
• 6:33
  Speaker 1: hackers themselves. That's how sophisticated we're getting here. So I
• 6:36
  Speaker 1: anticipate that we're going to see a lot more security
• 6:40
  Speaker 1: starting to build up inside these exchanges. Now. I think
• 6:43
  Speaker 1: it's just a matter of time before we start to
• 6:46
  Speaker 1: see whether it's forensic teams or anti hacking, white hack
• 6:50
  Speaker 1: white hat hacker teams being built inside these exchanges, because
• 6:54
  Speaker 1: this is going to be a scenario that I think
• 6:56
  Speaker 1: plays out in more than just crypto exchanges, but when
• 6:59
  Speaker 1: we into real world assets, all sorts of assets that
• 7:02
  Speaker 1: could play into this. Now, you take that being said
• 7:05
  Speaker 1: of what's been going on with by Bet and then
• 7:07
  Speaker 1: you kind of question a few things. Here's Marty Party,
• 7:10
  Speaker 1: Here's what he said. This was no hack. It's all
• 7:12
  Speaker 1: a narrative to hide the biggest corruption in centralized exchange history,
• 7:16
  Speaker 1: involving all major exchanges and their leverage positions on EATH. Now,
• 7:20
  Speaker 1: now that's a statement that no proof behind this. But
• 7:23
  Speaker 1: the point is is that this creates a very interesting
• 7:27
  Speaker 1: narrative because crypto does seem to stick together as we've
• 7:31
  Speaker 1: already shown. Could this even be a potential of where
• 7:35
  Speaker 1: there was some nefarious activity that may have been from
• 7:38
  Speaker 1: who knows where. Now let's talk about fed ray cuts.
• 7:41
  Speaker 1: Pomp goes in and they talk about fed Ray cuts.
• 7:44
  Speaker 1: What's it going to take to get this market charge
• 7:45
  Speaker 1: back up again? Or are we in the beginning of
• 7:49
  Speaker 1: a bear market?
• 7:50
  Speaker 3: Take a look if the Fed doesn't cut this year
• 7:54
  Speaker 3: and where it looks like it isn't that's why you
• 7:56
  Speaker 3: supposedly own things like old and bitcoin because of inflation,
• 8:00
  Speaker 3: and then bitcoin goes down to a point.
• 8:03
  Speaker 2: Now, the other thing I'm paying attention to is this
• 8:04
  Speaker 2: idea is being popularized by Jim Bianco, which is the
• 8:07
  Speaker 2: mar A Lago accord and Basically, the idea is that
• 8:10
  Speaker 2: the dollar's too strong, and instead what we're going to
• 8:12
  Speaker 2: use is we're going to use tariffs, we're going to
• 8:14
  Speaker 2: go and we're going to use the Sovereign Wealth Fund,
• 8:15
  Speaker 2: and then we're also going to get payment for security.
• 8:17
  Speaker 2: Those three things. The general idea is to reduce the debt,
• 8:20
  Speaker 2: get interest rates down, and weaken the dollar. If you're
• 8:22
  Speaker 2: able to do that, I think that that would be
• 8:24
  Speaker 2: very good for bitcoin in for stocks.
• 8:27
  Speaker 1: All Right, So that's an interesting statement because to what
• 8:30
  Speaker 1: he's talking about. Jim Bianco, we've had him on the
• 8:32
  Speaker 1: show before and I've listened to his theory about the
• 8:35
  Speaker 1: mar A Lago accord, and I would agree to a
• 8:37
  Speaker 1: certain extent the idea behind it. When you look at
• 8:39
  Speaker 1: the infrastructure, it's going to take some time to construct that,
• 8:44
  Speaker 1: and that means possibly through summer, which could also orchestrate
• 8:49
  Speaker 1: a possible adjustment not only in the Fed funds rate
• 8:52
  Speaker 1: but also inflation in general. But there are going to
• 8:54
  Speaker 1: be some scenarios where we do see if this does
• 8:57
  Speaker 1: come to pass, where we would see a weaker dollar,
• 9:00
  Speaker 1: and if that does occur, RISS assets will of course
• 9:02
  Speaker 1: be the beneficiary of that. So it's really more of
• 9:05
  Speaker 1: a longer play here, and it goes back to if
• 9:08
  Speaker 1: you look at some of the other analysts that we've
• 9:10
  Speaker 1: had on before talking about the extension. We just had
• 9:13
  Speaker 1: Roald Pollall on the other day, he was talking about
• 9:15
  Speaker 1: the extension of this bull run possibly into twenty twenty six.
• 9:18
  Speaker 1: You look at Tom Lee also looking at later in
• 9:20
  Speaker 1: the year, many people starting to look at a longer
• 9:24
  Speaker 1: bull cycle and a reclaim of what we could see
• 9:28
  Speaker 1: based on what the inflation situation that we're dealing with
• 9:32
  Speaker 1: right now. All right, With that being said, you look
• 9:34
  Speaker 1: at a couple other things that are playing out right here.
• 9:37
  Speaker 1: US CPI inflation and on track to hit four point
• 9:39
  Speaker 1: six over the next six months. That's again if it
• 9:42
  Speaker 1: stays on track at the current rate of increase. But
• 9:45
  Speaker 1: the CPI inflation has average point four per month over
• 9:48
  Speaker 1: the over the month basis over the last three months,
• 9:51
  Speaker 1: so if it holds that position, we'd see at four
• 9:53
  Speaker 1: point six. Would be insane to hold that because that's
• 9:56
  Speaker 1: double the rate of the Fence two percent inflation target,
• 9:58
  Speaker 1: which is another factor this again back to what pomp
• 10:01
  Speaker 1: was talking about, would freeze any kind of FED rate cuts,
• 10:05
  Speaker 1: so we would see either no rate cuts at all
• 10:09
  Speaker 1: or possibly a rate increase, which would be the scenario
• 10:12
  Speaker 1: that could play out of this. So you have to
• 10:14
  Speaker 1: look at that and what that could be to the market.
• 10:16
  Speaker 1: Other things that are considerable and under consideration for kind
• 10:21
  Speaker 1: of analyzing where the market's going. As you look at
• 10:23
  Speaker 1: the government, the funding situation in terms of a lapse,
• 10:26
  Speaker 1: if we don't get the federal fund the federal government funded,
• 10:29
  Speaker 1: and this would happen around March fifteenth, it's a seventy
• 10:32
  Speaker 1: five percent chance right now that this is going to stop.
• 10:35
  Speaker 1: In other words, the government will shut down if that goes. Yes,
• 10:39
  Speaker 1: there's a lot of negotiating going on back and forth
• 10:42
  Speaker 1: kind of in the halls of DC, but this will
• 10:44
  Speaker 1: be a big factor that would be bad for Donald
• 10:46
  Speaker 1: Trump's administration. So we'll see warning US stock market reaches
• 10:50
  Speaker 1: the most overvalued level in history, would continue to see
• 10:54
  Speaker 1: a little bit of this over evaluate evaluation. If you
• 10:57
  Speaker 1: look at the last time we saw some of these
• 10:59
  Speaker 1: were at ninety nine. If you weren't around then that
• 11:02
  Speaker 1: was a big, huge bomb scenario. We had almost seven
• 11:05
  Speaker 1: trillion wiped off the books, many of which came out
• 11:08
  Speaker 1: of the Silicon Valley fales of many tech companies, you know,
• 11:11
  Speaker 1: and then we saw kind of those big bumps in
• 11:14
  Speaker 1: between that two thousand and eight last financial crisis all
• 11:17
  Speaker 1: the way back into the eighties. So there's been some
• 11:19
  Speaker 1: interesting highs and lows. We are at one right now.
• 11:23
  Speaker 3: Now.
• 11:23
  Speaker 1: The question is does it hold on to these charts
• 11:26
  Speaker 1: and stay with the potential to lose that. Other things
• 11:29
  Speaker 1: that are happening right now, which is a little bit
• 11:32
  Speaker 1: concerning on bitcoin's front, is that Montana, North Dakota, and
• 11:35
  Speaker 1: Wyoming have all rejected the strategic bitcoin bills for reserves
• 11:41
  Speaker 1: based on volatility concerns. And that's an issue because if
• 11:46
  Speaker 1: we see more states start to bail out of that.
• 11:48
  Speaker 1: I know we had Dennis Porter on not too long ago,
• 11:51
  Speaker 1: probably a good idea of getting back on because I
• 11:52
  Speaker 1: wonder if this starts to break down across other states,
• 11:56
  Speaker 1: what kind of impact did this have on bitcoin overall. Now,
• 11:59
  Speaker 1: those are all the bearish things. Let's look on the
• 12:02
  Speaker 1: bullish front here, because there's still a lot that is
• 12:05
  Speaker 1: very bullish in the market. Bullmarket peak indicators. If you
• 12:09
  Speaker 1: look at these on selling the top right now, the
• 12:11
  Speaker 1: hold position is one hundred percent right now, on hole position,
• 12:15
  Speaker 1: and if you look at all the references in here,
• 12:17
  Speaker 1: the bitcoin rainbow chart, days of net eth outflows, none of.
• 12:21
  Speaker 3: These have hit.
• 12:22
  Speaker 1: So when you look at this chart, you'll see right
• 12:25
  Speaker 1: there those axes right there to your multiplier, the Bitcoin
• 12:28
  Speaker 1: bubble indexes not hit. The USDDT Flexible Savings not hit
• 12:32
  Speaker 1: RSIs the twenty two day Bitcoin dominance, all of these
• 12:36
  Speaker 1: not hit. So are we in a very predictable but
• 12:42
  Speaker 1: unusual bear market where we see these highs and lows
• 12:46
  Speaker 1: and then this retracement into some of these all coins.
• 12:49
  Speaker 1: Solana of course is the biggest one where it's plunge
• 12:52
  Speaker 1: is plunged to its lowest price since October. And of
• 12:56
  Speaker 1: course this has been because I think some of the
• 12:59
  Speaker 1: negative press that Solana has had because of the maan
• 13:02
  Speaker 1: coin scenarios we saw, of course the Libra fiasco last week.
• 13:06
  Speaker 1: Then of course the bybit thing comes and has nothing
• 13:08
  Speaker 1: to do with Solana, but a lot of the liquidations
• 13:10
  Speaker 1: have been kind of cycling in through Solana, which has
• 13:13
  Speaker 1: created another little problem going to the market. The other
• 13:17
  Speaker 1: bullish things on this could be that we're continuing to
• 13:21
  Speaker 1: see the SEC really piling in on very positive administration
• 13:26
  Speaker 1: potential comparisons as the task force goes to work, when
• 13:30
  Speaker 1: you dive into what they were meeting on, obviously you've
• 13:33
  Speaker 1: got Sailor in there, which is the Bitcoin Maxie, and
• 13:37
  Speaker 1: for him to go out there and do this in
• 13:39
  Speaker 1: more of a overall approach on digital assets framework is
• 13:44
  Speaker 1: pretty significant because it's good for digital assets as a whole.
• 13:48
  Speaker 1: But I think the scenario is that a lot of
• 13:50
  Speaker 1: the details they're getting into are potentially the scenario that
• 13:54
  Speaker 1: plays out in terms of the SEC restructuring their digital
• 13:58
  Speaker 1: assets approach. All of this very very popular and I
• 14:02
  Speaker 1: think very bullish for crypto in general. All right, let's
• 14:05
  Speaker 1: jump to this tweet right here. This is where Robin
• 14:07
  Speaker 1: Hood's situation completely got dropped with the SEC. So the
• 14:11
  Speaker 1: case is there's going to be no enforcement. This is
• 14:14
  Speaker 1: really good news for Robinhood. I think it's also very
• 14:17
  Speaker 1: good for the market if you compare this to what
• 14:21
  Speaker 1: happened last Friday with Coinbase also being dropped, also very
• 14:25
  Speaker 1: very bullish overall. The other point that I want to
• 14:28
  Speaker 1: make too is if you look at the newfound interest
• 14:31
  Speaker 1: in staking potential here, this would be the next logical
• 14:35
  Speaker 1: would be to reconsider the lawsuit against consensus e So
• 14:39
  Speaker 1: this again would be very very positive for Ethereum and
• 14:42
  Speaker 1: I think also just the general crypto market as a whole.
• 14:46
  Speaker 1: So we're going to watch that one very closely as
• 14:49
  Speaker 1: things start to brew there with the SEC sixty four
• 14:52
  Speaker 1: billion dollars asset manager, Citadel now is going to be
• 14:55
  Speaker 1: offering crypto trading, so they're going head to head with Fidelity.
• 14:59
  Speaker 1: This will be good good, and it also normalizes crypto
• 15:03
  Speaker 1: into the normis where people that are in Citadel they'll
• 15:07
  Speaker 1: have the chance to now be able to trade just
• 15:09
  Speaker 1: like you know with Fidelity. I'm kind of curious for
• 15:12
  Speaker 1: those of you that are out there that may have
• 15:14
  Speaker 1: Fidelity accounts, have you ever bought bitcoin or Ethereum Infidelity
• 15:18
  Speaker 1: let me know down in the comments. I'm kind of
• 15:20
  Speaker 1: curious because we see the traditional route to crypto, but
• 15:23
  Speaker 1: there are other routes into crypto that are in the
• 15:27
  Speaker 1: TRADFI lane. So Citadel now going to be one of those.
• 15:31
  Speaker 1: Kobe EC letter, these are the events this week that
• 15:33
  Speaker 1: you need to watch out for. You've got consumer confidence
• 15:36
  Speaker 1: data coming out on Tuesday. The big data well in
• 15:39
  Speaker 1: video is a big one. Wednesday, we'll see reports and
• 15:41
  Speaker 1: their earnings coming out. I also think the scenario with
• 15:45
  Speaker 1: the PCE inflation data on Friday is going to be
• 15:49
  Speaker 1: a very key data point to watch, so be watching
• 15:52
  Speaker 1: for that one. And then we have ten FED speaker
• 15:55
  Speaker 1: events this week, so there's going to be all sorts
• 15:57
  Speaker 1: of news, most likely coming out of DC. All right,
• 16:01
  Speaker 1: we will get to you guys on all that. We've
• 16:03
  Speaker 1: got a big lineup of interviews this week and a
• 16:05
  Speaker 1: lot more coming for you. If you're not in the
• 16:07
  Speaker 1: Diamond circle, get in right now. It's a great place
• 16:09
  Speaker 1: to get into content and join me out there on
• 16:12
  Speaker 1: X It's just at Paul Barrett. We'll catch you next
• 16:14
  Speaker 1: time right here on Techpath