Here’s what you’ll find in today’s edition:

• Fidelity’s crypto research head addresses the too-late-to-invest question, possible stagflation scenario.

• Interest rates have been falling, so why are treasury yields rising?

• Coinbase got some good news on the legal front.

Fidelity exec addresses ‘too late?’ question, stagflation scenario

Fidelity Digital Assets addressed a question in its 2025 outlook report that many investors have been asking: “Is it too late?”

The query isn’t absurd given BTC’s recent rise to an all-time high above $108,000 last month. Buying is of course more fun before a big run.  

In the report, Fidelity Digital Assets research director Chris Kuiper mentions starting to see “early signs of mass diffusion and adoption.”   

He adds: “Although this process will likely take decades, 2025 has the potential to be the year that is looked back on as the pivotal time where the ‘chasm was crossed’ as digital assets begin to take root and embed themselves into multiple fields and industries.” 

Kuiper cites existing and discussed nation-state and corporate crypto adoption, which we’ve tracked here in recent weeks. 

“Therefore, it may be too late for the speculators that want another frenzy,” he explained. “However, we believe we are still incredibly early in terms of this new era of sustainable adoption, diffusion and integration.”

This “Am I too late?” question reminded me of my conversation with Franklin Templeton’s Roger Bayston last month. He too mentioned this was something on the minds of institutions. 

“We’ve seen this price run up and now I’m going to buy it?” he said, imitating an investor questioning that logic and wanting to buy cheap.

But with a more favorable US regulatory environment unfolding, it appears there’s “plenty of run room,” Bayston added. Bullish 2025 BTC price predictions range from $125,000 to $200,000.  

Beyond the potential regulatory catalysts, Kuiper wrote that inflation could come back in a second wave (given inflation measures resisting a return to the 2% target, large fiscal deficits and the Fed’s rate-cutting cycle).

“If a recession does occur, it will likely be responded to with additional monetary and fiscal stimulus, which historically has been good for bitcoin,” he noted. “If risk assets continue to appreciate and inflation continues to run above the 2% target, bitcoin will also likely do well.”

And then there’s the potential for a stagflationary environment, which Kuiper says BTC has not ever really encountered. A Fidelity Digital Assets chart illustrates gold’s performance during the stagflation era of the 1970s and early ’80s. It shows gold rallying most during the second wave of inflation, offering a potential parallel for how bitcoin might behave.

BTC is currently 13% below its all-time high, with potential corrections ahead that could present additional buying opportunities.

Swan Bitcoin co-founder Brady Swenson said it appears the market has largely priced in the creation of a strategic bitcoin reserve soon after Trump takes office.

He added in an email: “If that does not happen quickly, the inauguration could actually be a ‘buy the rumor, sell the news’ event, which would send bitcoin price temporarily downward."

You don’t need me to say none of this is investment advice. But I’ll remind you anyway.

— Ben Strack

The percentage of surveyed financial advisers who say they’re authorized to invest in crypto for clients today. This finding comes from a yet-to-be-fully-released report from Bitwise and VettaFi.

That number might seem low to some, particularly given the success of US bitcoin ETFs last year.“Translation: We are still early,” Bitwise wrote in a Tuesday X post.

Treasury yields were once again on the rise Wednesday while US equities struggled to recover from a rough day of trading yesterday. 

The US government’s monthly 10-year Treasury note auction on Tuesday drew the highest yield since 2007: 4.68%. Benchmark yields on 10-years hit a high of 4.73% Wednesday morning, a level not hit since last spring.

Zooming out, since the Fed started its rate-cutting cycle in September, yields on 10-year notes have increased from around 3.7% to 4.7%. It’s an inverse correlation not typically seen, at least if you look back upon the past 10 easing cycles. 

What gives? 

Well, first of all, we aren’t in a typical easing cycle. Normally, rate cuts signal an approaching recession. This time, the Fed is lowering interest rates because central bankers believe inflation is sufficiently declining — or at least, they did.

FOMC members’ inflation expectations have risen from 2.6% to 2.8% for 2024, and as such, their median projections for cuts to the fed funds rate has decreased by 50 basis points. Futures markets are now pricing in a 95% chance central bankers hold rates steady at their next meeting later this month. 

Plus, bond traders are reacting to the new (old) administration headed for the White House in less than two weeks. Today’s selloff (remember, bond prices and yields move in opposite directions), is likely linked to rising concerns about Trump’s incoming tariff policies.  

So, it’s a strange situation with perhaps a reasonable explanation, but we’re keeping an eye on the situation. The latest Fed minutes — set to be released this afternoon — should also give us more insight.

— Casey Wagner

While some continue to hope that the upcoming Trump-era SEC will wave its magic wand and dismiss pending lawsuits against multiple crypto firms, Coinbase was just handed a win. 

The exchange, which the SEC sued in 2023, yesterday won its motion for an interlocutory appeal on whether crypto assets constitute investment contracts. The ruling is not an end to the case. But it will require the Second Circuit to consider this question, which, Coinbase argued, “could not be more pressing” in “numerous cases pending…across the country.” 

From Judge Katherine Polk Failla’s order to grant Coinbase’s interlocutory appeal motion: 

In other words, Failla thinks the legal question at hand — how and if crypto assets should be subject to securities laws — is too big to not consider at the appellate level. 

Failla has ordered a stay in proceedings until the interlocutory appeal is resolved, which could take months, if not longer. A ruling from the Second Circuit bears more weight than the District-level orders we’ve seen in recent months, many of which contradict one another. 

Coinbase’s expensive, time-consuming legal battle just may be exactly what the industry is looking for…assuming things go its way, of course.

— Casey Wagner

• Bitcoin dropped below $93,000 today before landing at about 94,800 by 1:30 pm ET — down more than 2% from 24 hours ago. Ether had also dropped roughly 2% over that span, hovering just over $3,300.

• We’ve seen plenty of companies buying BTC. But publicly traded SOL Strategies on Tuesday noted that its $25 million (CAD) unsecured, revolving demand credit facility would be used exclusively to buy solana tokens.

• Self-custodial crypto platform Exodus rang the New York Stock Exchange Opening Bell Wednesday after its long-awaited listing on the NYSE American stock exchange last month. The stock was up 12% so far in 2025, as of 1:30 pm ET.