Welcome to the Forward Guidance newsletter, brought to you by Casey Wagner and Ben Strack. Here’s what you’ll find in today’s edition:

• The crypto stocks a blockchain ETF portfolio manager has his eye on.

• Tips from tax experts as we wrap up an eventful 2024.

• What you may have missed this week, Fed rate cut and all.

Crypto stocks to watch

When examining crypto stocks, chatting with a co-portfolio manager of the long-running blockchain-focused Amplify Transformational Data Sharing ETF (BLOK) makes for a good convo.  

Dan Weiskopf told me he’s more optimistic about 2025 now than he was about this year at the end of 2023.

A main reason? The “crazy opportunity” for BLOK investors that’s set to come as more pure-play crypto companies go public. 

Some expect stablecoin issuer Circle could be among the next to do so. Weiskopf also has his eye on Figure Technologies.

While a few more bitcoin miners could also go public, that’s a crowded field, Weiskopf noted. But BLOK would consider holding cloud-computing firm CoreWeave — one of mining giant Core Scientific’s largest clients.

Speaking of Core Scientific, that stock — up ~320% year to date — is BLOK’s No. 1 holding (4.67%). Another interesting miner to Weiskopf is Hut 8 — the ETF’s sixth-largest holding, at 4.16%.

“I think we did a really good job repositioning and recalibrating amongst the miners in capturing the diversification into the AI side of things,” the PM said.

Hut 8 is weighted slightly above MicroStrategy — a stock set to enter the Nasdaq 100 index next week (I’ll write more about that on Monday). BLOK started buying MSTR in August 2020 (when it was $14), Weiskopf and co-PM Mike Venuto noted. 

MSTR shares were trading around $350 this afternoon (up more than 400% YTD). Benchmark analysts on Monday upped their price target for the stock to $650 after MicroStrategy increased its bitcoin holdings to 439,000 BTC.

That said, Weiskopf and Venuto recently reduced BLOK’s exposure to MSTR and CORZ as the stocks “rallied past our weighting limits,” they added. In other words, they’re trimming the winners in hopes of moving into other successes.

On that diversification point: As the BLOK money managers await more IPOs in 2025, they started buying Japan-based Metaplanet last month.

While more companies are adding BTC to their treasuries (~60 by Weiskopf’s count), many are small. So-called “zombie companies” aren’t likely to bounce back just because they’ve bought the crypto asset, he said.

“They make a headline, but do they have a real strategy?” Weiskopf added about evaluating these BTC purchasers. 

He argued that Metaplanet, which in April unveiled its intent to emulate MicroStrategy’s efforts, is one committed to these BTC buys. The company said this week it would issue 5 billion yen in ordinary bonds to accelerate bitcoin purchases.

So, for those monitoring crypto stocks, BLOK holdings appear worth peeking at. And then there’re the yet-to-arise opportunities during what could be a transformative year for the segment.

— Ben Strack

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The latest low point for bitcoin before the asset bounced back up to ~$96,900 by 2 pm ET. BTC is down about 3% from a week ago.

“The market mirrored declines in equities and bonds as the post-FOMC hangover persisted, with traders trimming risk ahead of the typically low-liquidity holiday season,” said Wintermute OTC trader Jake O.

Bitwise’s Matt Hougan argued the pullback was “an opportunity and not a reversal.”

As the end of the year looms, the days to get your 2024 taxes in order are numbered. 

I asked tax experts for their best last-minute tips. I’ll share what they said, but when in doubt, consult an accountant: 

Lock in your losses 

I know we’re in a crypto bull market now, but if you’re still sitting on any assets (maybe some NFTs or altcoins?) that haven’t fared as well, now may be the time to take the loss. 

If you have or are planning on taking any gains this year, a realized loss on equities or tokens can lower your tax bill. 

Consider a charitable donation 

Donating appreciated crypto to a tax-exempt organization saves you and the charity on capital gains taxes. Qualifying donations are also tax-deductible, potentially lowering your total bill. 

Remember to donate any asset as-is; don’t convert to fiat or other tokens. Some charities even accept NFTs, but make sure to check if you’ll need an appraisal of the digital asset to claim your deduction. 

Need to use the safe harbor? Do it now. 

Starting in 2025, the IRS will no longer accept the universal accounting method (where you report your basis and gains as if all your crypto assets are held in one wallet, even if they are spread across several). 

The wallet-by-wallet accounting method is more complicated, but the IRS is allowing a one-time safe harbor where taxpayers can assign unused cost bases to a specific asset or across assets in a given wallet. The deadline to do so is Jan. 1, 2025.

— Casey Wagner

Happy Friday! This will be our last “did you notice?” section for a couple weeks as we head into the holidays. 

It was a very busy week though, so we’re certainly ending on a high note. 

• The Fed opted to cut interest rates by 25bps one final time this year, putting us at 4.25%-4.5% to close out 2024. The move, although widely expected, did little to calm investors. Still, the S&P 500 and Nasdaq Composite indexes were each up about 1.4% on Friday, as of 2 pm ET. The market is now fairly certain central bankers will start the new year off with a pause, with fed funds futures showing an 89% chance of no rate change next month. 

• Initial jobless claims on Thursday came in lower than expected. 220,000 people filed for first-time benefits in the week ended Dec. 14, a slowdown from the 242,000 reported the week prior. Continuing claims were also on the decline, coming in at 1.87 million (5,000 lower than the week prior). 

• November’s PCE showed prices rose 2.4% in the past year — a faster pace than we saw in October, but a bit lower than the consensus expectations. Core inflation, which excludes food and energy costs, saw a 2.8% increase in the 12 months ended November.

— Casey Wagner

• If you missed Felix’s section yesterday on the market’s reaction to this week’s FOMC meeting, read it here. 

• Ether’s price was ~$3,430 at 2 pm ET Friday — up slightly from a day ago, but down more than 11% in the past seven days.

• The net inflow streaks for US spot bitcoin and ether ETFs ended Thursday, Farside Investors data shows. About $670 million left the BTC products yesterday, while investors pulled roughly $60 million out of the ETH ETFs, snapping an 18-day net inflow run.

• The SEC approved the 19b-4s for crypto index ETFs proposed by Hashdex and Franklin Templeton. The funds are set to hold both BTC and ETH initially but could look to add crypto assets down the line should the regulatory environment allow for that.