Crypto Breakthrough

Crypto ETFs: The Next Generation

Here come the altcoin ETFs.

“The crypto industry could be set for a flood of new crypto exchange-traded funds in October,” reports Cointelegraph — “with the U.S. Securities and Exchange Commission set to make their final decisions on 16 crypto ETFs next month.”

Solana… Ripple… Litecoin… even Dogecoin (which we’ll remind you started as a joke)...

All of them could have dedicated ETFs trading before the end of the month — giving easy access to retail investors without setting up a crypto wallet or even a Coinbase account.

The first one up for approval is a Litecoin ETF proposed by the crypto-centric firm Canary Capital. The SEC must give the yay or nay by Thursday.

It’s worth stepping back just a moment to see how we got here…

October 2021: ProShares launches the first “Bitcoin ETF.” It’s in quotation marks there because the ETF tracked the price of Bitcoin futures, not Bitcoin itself. So there wasn’t a perfect 1:1 match in the price movement. It took another two years and change before the regulatory dam finally broke for actual crypto ETFs…

January 2024: The SEC approves the first Bitcoin ETFs linked to real Bitcoin traded on the spot market. Joe Biden’s SEC chair Gary Gensler put up fierce resistance — but ultimately relented because BlackRock CEO Larry Fink wanted a piece of the crypto action for his iShares ETF family.

July 2024: It was inevitable that once Bitcoin ETFs won approval from the Biden SEC that Ethereum ETFs would also get the green light.

Today there are 21 ETFs that own either Bitcoin, Ethereum or both.

You might think the pace would have picked up as soon as the Trump 47 administration swept in eight months ago. Trump’s pick for SEC chair, Paul Atkins, is so crypto-friendly he previously headed up a crypto lobbying outfit.

But everything in Washington takes time. Franklin Templeton put in applications for Solana and Ripple ETFs way back in March. Shortly after Labor Day, the SEC kicked the applications back to November.

“The SEC has delayed decisions on multiple crypto ETFs throughout 2025, setting several new deadlines,” says CoinTelegraph; “however, the regulator has also taken steps toward shortening the timelines amid a friendlier approach to crypto.”

Then a major change came 12 days ago — when the SEC approved a new listing standard for crypto ETFs.

The move “eliminates the need for individual regulatory review of each crypto ETF application, allowing products that meet predetermined standards to launch without a lengthy case-by-case approval process,” says the Reuters newswire.

“That will slash the approval time for new crypto products to 75 days or less, from up to 270 days previously, industry sources said.”

Curiously, ETF giants BlackRock and Fidelity are sitting out this new flurry of ETFs.

“None of the ones with the deadline in October were issued by Fidelity or BlackRock, which are the two major players in the Crypto ETF space,” says a note from Daan Crypto Trades. “Regardless, might be something to watch out for in the weeks ahead,”

[Editor’s note: There’s another development pending in Washington — even more imminent than the ETF approvals — that our James Altucher believes will lead to “the biggest crypto opportunity of our lifetime.”

James and his team have pinpointed five coins set to explode from an imminent Trump crypto law that could be signed as early as tomorrow. Follow this link to watch James’ urgent briefing before Trump acts.]

In the meantime, the crypto market is bouncing back from a “whoosh” late last week — Bitcoin back over $113,000 and Ethereum clearing $4,100 easily.

“In a World of $15,000 Gold…”

It’s not just our own Jim Rickards anticipating a five-figure gold price down the road. Check out the following post that’s getting scads of views on X…

No, we won’t make you squint. That’s a chart of the gold price divided by the Dow Jones Industrial Average. The big peak on the left side of the screen was when gold hit a record $800 an ounce in 1980 and the stock market was on its heels. The big bottom in the middle was at the turn of the century when gold traded for $260 while the dot-com bubble was starting to burst.

The ratio is breaking out above that red long-term “resistance” line. Hence the likelihood of gold exceeding $5,000 medium term and $15,000 longer term.

Thing is, once gold soars to such stupendous levels, it suggests something in the economy and society is badly broken. As some wags put it, a world of $15,000 gold is also a world of a $50 loaf of bread.

Or is it? As Jim Rickards’ senior analyst Dan Amoss points out on the Paradigm internal e-chat this morning, America is self-sufficient in bread.

Dan got to thinking about which goods would truly soar in price if confidence in the dollar collapses and gold soars to unimaginable heights.

As he sees it, the most vulnerable goods are “1) the top net imported products that also 2) have low demand priced elasticity and few local substitutes.” That is, stuff people have got to have at any price.

“Here are the 10 largest net import categories to the U.S. in dollar terms. Some within these categories are low-demand-elasticity ‘must haves’:

• Electrical machinery & equipment
• Machinery including computers
• Vehicles & automotive parts
• Pharmaceutical products
• Mineral fuels & oils
• Optical, technical & medical apparatus
• Furniture, bedding & lighting
• Plastics
• Articles of apparel & clothing
• Toys, games & sports requisites.”

Some interesting sectors to think about, if God forbid America goes the way of Weimar Germany a century ago…

Until then, precious metals are starting the week on yet another tear.

At last check gold is up $65 to a record $3,823. Silver is up 82 cents to another high-since-2011 level of $46.81.

But the cheery mood doesn’t extend to all of the commodity complex. For no obvious reason oil has tumbled over two bucks as the week begins to $63.44.

AI: The Wall of Worry

“This AI-led bull market continues to climb a wall of worry,” observes Paradigm’s jack-of-all-trades editor Zach Scheidt.

Yes, the major averages stumbled toward the end of last week. But as we write this morning the S&P 500 is up a bit to 6,664 — less than a half percent below last Monday’s record close.

“You’ve probably seen some of the recent headlines,” says Zach…

• Nvidia just announced it is investing $100 billion into OpenAI to build data centers, with OpenAI using Nvidia’s AI chips

• Nvidia is also spending $5 billion with Intel on custom chips for AI infrastructure

• Microsoft said it’s spending a record $30 billion in capital expenditures this quarter, most of which is going to build AI data centers and related technologies

• Google plans on laying out $85 billion in spending this year, up from a prior estimate of $75 billion, as the AI giant invests in more servers and data center construction ‘... primarily to meet cloud customer demand,’ according to the company’s chief financial officer, Anat Ashkenazi.

“When you take into account inflation, there’s been more spending on the AI buildout in the past three years than on interstate highway construction for more than 40 years,” says Zach.

[Which also says something about the state of America’s highways, but we digress…]

“For AI stocks in particular, we’re seeing a juxtaposition between two basic types,” Zach continues:

• “The infrastructure companies building the data centers, the chipmakers and the power management businesses creating the ability to do AI processing. These are lower-risk plays that are seeing a lot of capital pour in

• The companies making AI applications — everything from software to robots to AI agents. These are more high-risk companies, not necessarily making money yet, but with huge upside potential.

“In a sense, the AI stock market is becoming more fractured, and it pays to be more choosy right now.”

That choosy approach paid off huge last week for readers of Altucher’s True Alpha, where Zach serves as senior analyst. The trade was call options on an AI name that’s carved out a niche in speech recognition. The first half of that trade zoomed 438% in less than three weeks — and readers are holding on for still more with the second half!

Comic Relief

Oh hey, did we mention something earlier about the state of the highways? Someone made it into a meme that’s getting circulation…

Mailbag: Class Warfare

“Rich vs. Poor… or People vs. Government,” says the subject line of a thought-provoking email after last Thursday’s edition.

“Hi Dave — once again I agree with most of the stuff in this issue but I think Caitlin Johnstone’s quotes at the end need more nuance. I’m familiar with Carlin’s quote and that needs a little more nuance too.

“Calling it a puppet show is a bit of an oversimplification. While it’s true many powerful interests in the ‘empire’ or the deep state remain in power no matter who’s in charge, the left versus right dynamic is not totally meaningless theater and affects our lives differently depending on the party. I think the right is generally less bad but that says more about how crazy the left is.

“And even issues that seem impossible to solve can be addressed in a sane manner, a good case in point being RFK Jr. and his battle against the health care cartel. I don’t think he’ll ultimately succeed in breaking it up but it’s a good start.

“The point is it’s not the case that nothing important can change, though I don’t expect problems like spending, financialization and currency debasement to be resolved anytime soon. So while it’s true the system is a puppet show in some regards, that’s not the whole story.

“There’s a similar issue with Carlin’s quote. It sounds like he’s saying all rich people are the problem (a common belief on the left) instead of those connected to politics.

“I think he kind of realized this because he mentioned the ‘ruling class’ but then oversimplifies it by talking about ‘the rich.’ Personally, I would’ve used the terms ‘power elite’ or ‘oligarchs’ to refer to them. I know comedians can’t make it too complicated but he could’ve clarified it. But the basic ‘divide and conquer’ tactics are real. I think this is only a serious problem the bigger the government is.

“Also, that meme at the end stinks of Marxism and I’m surprised you used it. It should be neither a left versus right war nor a class war, but a ‘down versus up’ war, i.e., the people versus the govt. And that can only come about with an informed public.

“So yeah, not happening soon. Anyway, keep up the good work!”

Dave responds: All valid points.

That said, even in the Trump era I gravitate toward the outlook of Carroll Quigley, the Georgetown poli-sci prof whose many famous students included Bill Clinton.

"The argument that the two parties should represent opposed ideals and policies, one, perhaps, of the right and the other of the left, is a foolish idea acceptable only to doctrinaire and academic thinkers,” Quigley wrote in the most famous passage of Tragedy and Hope, his 1966 magnum opus.

"Instead, the two parties should be almost identical, so that the American people can 'throw the rascals out' at any election without leading to any profound or extreme shifts in policy."

Meanwhile, I too prefer — and at times have used — “power elite,” which was popularized by a left-leaning sociologist, C. Wright Mills, in a book of that name during the 1950s. It conveys more nuance than “ruling class,” which seems to be Tucker Carlson’s default.

So yes, I totally agree — the issue is not wealth per se but rather wealth obtained through proximity to political power — clout, if you prefer. (Thus, my contempt for Alex Karp and Sam Altman.)

It’s a crying shame the Marxists hijacked the field of class analysis — which was first staked out by liberal (in the old sense of the word) French historians a few decades earlier.

No, the cartoon/meme didn’t convey that subtlety — but I was OK with it regardless because of how it captures the divide-and-conquer phenomenon. Ideally instead of a 19th-century tycoon type it should have depicted Klaus Schwab!

Best regards,

Dave Gonigam
Managing editor, Paradigm Pressroom's 5 Bullets