lyhalfway

Partisan competition takes top priority; not a single Democratic congressman voted in favor.

Even if the bill fails, BTC at 7.5w and ETH at 2.35k still have solid support after the wick. The vote is more of an interlude; the pessimistic outcome is already priced in. Moving forward, the main focus remains on the FOMC.

Many investors are tracking the odds shifts for the Clarity Act on Polymarket, which have swung from 15% to 30% and back down to 19% over the past two days, reflecting a tense tug-of-war between the two parties.

It's important to note that the 19% or 30% odds on Polymarket specifically refer to the likelihood of the bill being enacted by 2026. The Sept. 15 vote merely determines whether the bill enters the Senate review agenda. With midterm elections this year and the House adjourning early in late September, even if the Sept. 15 vote passes, the window for subsequent legislative action remains tight, keeping Polymarket odds low.

The current focus is on the Sept. 15 vote itself. I believe the probability of passage here is far higher than the 19% implied by Polymarket. A likely outcome is a bipartisan compromise: passing the vote to uphold procedural norms while continuing to haggle during later legislative stages. This means significant hurdles remain for 2026 enactment—so the 19% figure might still be accurate—but it doesn't change the fact that the Sept. 15 vote has a ~40–50% chance of passing.

$Strategy(MSTR.US)$Coinbase(COIN.US)$Circle(CRCL.US)

$BitMine Immersion Tech(BMNR.US)

Clarity played out until the last moment before the vote; Trump made concessions to ethic, slightly increasing the likelihood of approval.

ETH has been doing pretty well recently; it's resilient to negative news and surges on positive ones, slowly recovering. $IShares Ethereum Trust ETF(ETHA.US)

$BitMine Immersion Tech(BMNR.US)

Bessent is being so straightforward, giving a live demonstration of what a "market maker" really means.

- It's about possessing extremely asymmetric information.

"When we intervene in the yen market, I know exactly what the Japanese people, the Bank of Japan, and the Japanese decision-makers are going to do."

Crypto recently pulled back after a rally and is stabilizing; trading volumes for MSTR and BMNR have also declined to levels seen before this uptrend. Although ETFs are still seeing net inflows, the pace has slowed. These signs suggest the market has entered a consolidation phase.

The move on Aug 20 was driven by Trump's crypto meeting and Bessent's buybacks. The current consolidation reflects a wait for the next major macro signal, with two key dates to watch:

Sept 15: Clear Act vote - the most critical policy event for crypto, requiring 60 votes to advance to Senate consideration.

Sept 16: FOMC meeting - interest rate decision that will determine macro liquidity.

Until then, expect continued consolidation with shrinking volume.

This chart shows the power-law distribution of BMNR and ETH tracked since August '25.

As seen above, there is a clear gap for ETH between 2.4k and 2.8k. Below 2.4k, both upside and downside ranges contract significantly, corresponding to the compression of BMNR's premium when ETH fell into the 1.5k-2.4k range over the past six months; above 2.8k, these ranges expand, implying greater volatility for BMNR vs. ETH, thus opening up upside potential for mNAV.

The sharp drop in ETH in February '26 created a vacuum zone between 2.4k and 2.8k. Chips in this range haven't undergone sufficient turnover, meaning there's little resistance here. A breakout could lead to a rapid surge to 2.8k, at which point BMNR's mNAV also has the opportunity to expand significantly.

The key observation level for ETH is the breakout of 2.8k.

$BitMine Immersion Tech(BMNR.US)

BMNP has also hit a new high. Although liquidity remains mediocre and not on the same level as STRC, we look forward to unlocking more potential in the future to enrich BMNR's financing toolkit.

Last week, BMNR's average daily trading volume was 1.3 billion, nearly 4x its previous level, and mNAV also bounced back to 1 at certain highs. Liquidity is the foundation of DAT; management restored cash positions via ATM offerings, accumulating over 30k coins and 300 million in cash.

Over the past two months, they repurchased shares when mNAV was at 0.8 and raised capital via ATM when mNAV returned to 1, corresponding to stock prices of roughly 16 for repurchases and 24 for equity financing.

I strongly agree with management's operational strategy over the past two months, and it seems the market is buying in as well.

$BitMine Immersion Tech(BMNR.US)

The net capital inflow into the 'Big Pie' and 'Second Pie' ETFs is still accelerating. After the massive single-day surge that triggered a short squeeze the day before yesterday, sustained upward momentum requires real capital to continue absorbing positions, which appears to be the current trend.

$Strategy(MSTR.US)

$BitMine Immersion Tech(BMNR.US)

$iShares Bitcoin Trust ETF(IBIT.US)

$IShares Ethereum Trust ETF(ETHA.US)

Compared to the gains in BMNR and ETH yesterday, the breakout of the large bullish candle on ETH/BTC is even more exciting, indicating that ETH is not simply following BTC's rise but is showing a stronger upward momentum.

Rising from a June low of 0.025 to 0.033, if the driver behind yesterday's crypto surge was liquidity from Treasury repurchases plus positive sentiment from the White House crypto meeting, the strength of ETH/BTC confirms the narrative: clear regulation → tailwinds for tokenization → tailwinds for ETH.

PS: Heard yesterday's liquidation event was second only in scale to Oct 11, but this time it was short sellers who got liquidated.

$BitMine Immersion Tech(BMNR.US)

$IShares Ethereum Trust ETF(ETHA.US)

In the previous cycle, MSTR's mNAV bottomed out before BTC;

In this cycle, MSTR has additional STRC, and BMNR has added BMNP. After experiencing the decoupling of STRC approaching 70 in July, MSTR restored its cash reserves by selling BTC and using ATM offerings, prioritizing STRC interest payments. Currently, STRC has also rebounded to around 95, as shown in Figure 1;

The same applies to BMNR's mNAV. Figure 2 shows the mNAV trend I've been tracking. BMNR's mNAV briefly returned to 1 in June but then fell to 0.8 along with the decline in ETH. However, with continuous buybacks by management for four consecutive weeks starting in July, market confidence was bolstered. With buybacks as a safety net, 0.82 became the bottom for mNAV. Currently, mNAV has rebounded to 0.95; this repair process took nearly two months;

If ETH rebounds further to $2k, I believe mNAV is expected to recover to 1. Based on these two observations, my view leans towards the idea that as STRC and BMNR's mNAV bottom out and rebound, both BTC and ETH are also nearing their bottom regions.

$BitMine Immersion Tech(BMNR.US)

$Strategy(MSTR.US)

$Microstrategy Inc Pref Shares STRC 9.0 Perp(STRC.US)

An analysis by JP Morgan on the winners of open-source vs. closed-source in different scenarios

The conclusion is that regardless of whether open-source weights, closed-source weights win or lose, or if it's a dead heat, large cloud providers and NVIDIA will all win

The logic behind open-source models benefiting cloud providers: The rise of open-source models is dismantling the monopoly of closed-source models, transforming CSPs from mere resellers of tokens into AI operating systems: Cloud providers control routing rights, customer relationships, and pricing power, allowing them to directly host open-source models and sell tokens, thereby reducing external profit-sharing. Meanwhile, open-source competition drives up training investment and call volumes.

This ultimately forms a positive cycle: Model layer rents decrease → Cloud provider monetization efficiency improves → Inference price drops stimulate new demand → High data center utilization drives continuous compute investment

$NVIDIA(NVDA.US)$Alphabet(GOOGL.US)$Amazon(AMZN.US)$Microsoft(MSFT.US)$Palantir Tech(PLTR.US)

PLTR differs significantly from other tech companies in its clear-cut stance on ideology or corporate spirit, and it never hides this. I previously discussed similar views with @Luyouyou; as a result, PLTR has an additional layer of value-driven appeal to top talent in Silicon Valley, which extends the company's narrative.

Perhaps it was Karp's background as a PhD in philosophy that shaped the company's culture. From publishing the book *The Technological Republic* last year to emphasize that tech companies should be closely aligned with national core interests, to the narrative on AI sovereignty since June this year, all these arguments for PLTR are presented from a perspective of value-based deliberation.

The shareholder letter following this earnings report continues to emphasize AI sovereignty. Karp stated very clearly in the letter:

"We will not be compensated based on clicks, tokens, or chat volume."

"Others, including many companies building large language models, whether intentionally or unintentionally, intend to control the means of production of their so-called partners."

"We have always refused, and will continue to refuse, to establish a parasitic relationship with our partners."

$Palantir Tech(PLTR.US)

Last week, two leading DAT companies both conducted share repurchases. BMNR repurchased 4.5 million shares, marking the third consecutive week of repurchases, with a cumulative total of 16 million shares.

MSTR also engaged in repurchases, but they were buying back STRC. The funds were raised by selling BTC (1638) and utilizing MSTR's ATM (3 million shares). It appears the company prioritizes protecting STRC, which is somewhat misaligned with the interests of MSTR shareholders.

$BitMine Immersion Tech(BMNR.US)

$Strategy(MSTR.US)

After the initial repurchase of 5.5 million shares, BMNR continued to repurchase another 6.1 million shares last week. mNAV is around 0.85, and ETH/BTC has rebounded to 0.03, a high point in nearly 3 months, with decent momentum.

$BitMine Immersion Tech(BMNR.US)

$IShares Ethereum Trust ETF(ETHA.US)

The biggest news yesterday was Huang Xiaoming opening an X account and posting his first tweet. An open letter initiated by a16z, jointly signed by NVIDIA, Microsoft, PLTR, PerplexityAI, Ollama, and other tech companies, explicitly advocates that "cutting-edge open-source models and cutting-edge closed-source models should coexist and develop."

Among so many companies, who didn't sign? Obviously Company A.

There is a data point: the weekly token share of Chinese open-source models used by US enterprises is approaching 60%. With open-source models accounting for such a large proportion of token consumption in US enterprises, if they are banned or restricted, enterprise costs will surge dramatically.

We previously discussed two paths for AI competition: model expansion and platform expansion. Now, enterprise AI adoption has entered the engineering era, with AI adoption in the enterprise market increasingly shifting to scenario-specific application models:

1) High-value scenarios continue to use high-value tokens from cutting-edge closed-source large models;

2) In high-frequency, low-complexity task scenarios, enterprises are increasingly favoring high cost-performance tokens (mostly from open-source models).

This trend is inevitable:

- For chip manufacturers, whether using which model, training and inference are required;

- For cloud providers, the more model choices offered to enterprise customers, the higher the gross margin;

- For deployment layers (such as PLTR) or application-oriented companies, there is naturally a stronger incentive to choose high cost-performance tokens.

The co-signing enterprises on this open letter basically fall into these three categories, so behind the open letter lies extremely strong commercial demands and huge commercial value. In other words, the attitude of O and A making money while blaming customers is increasingly causing dissatisfaction among customers and the industry, and the competition is becoming increasingly fierce.

$NVIDIA(NVDA.US)$Microsoft(MSFT.US)$Palantir Tech(PLTR.US)

Last week, mNAV remained at 0.8~0.85, and BMNR finally repurchased shares, 5.5 million shares $BitMine Immersion Tech(BMNR.US)

Nadella has published another long article discussing the economic reflexivity of AI. The concept of the Information Paradox describes the dilemma for information sellers: to prove the value of information, they must first disclose it; but once the information is disclosed, its value is captured for free by buyers. In the AI era, buyers who want to use good AI models instead risk handing over valuable know-how. The result is paying twice: once for tokens, and once for proprietary knowledge. Nadella directly quotes Karp's view in the article, "What technology customers want is control over their own computing power, models, data stack, and alpha. They need to be sure they own the means of production, not that it's being transferred to someone else."

Currently, it seems the new narrative for AI applications is a competition between two paths.

Camp A: The Token Economics of Model Vendors

Stronger models are better -> Higher usage is better -> Feedback for model training -> Shared weights

Form: Token consumption / Subscription-based

Camp B: Controlling AI Sovereignty / Learning Loop

Models are switchable -> Data/Logic stays within the enterprise -> The loop and data are the true AI Alpha

Form: Cloud platform / Sovereign stack / Heavy on-premise deployment

The current situation is that Camp B has been suppressed by Camp A for over half a year and is now starting to counterattack, vying for the right to define the narrative. Who will win?

$Microsoft(MSFT.US)$Palantir Tech(PLTR.US)

$Apple(AAPL.US) is suing OpenAI for ingesting trade secrets and intellectual property during their collaboration. OpenAI might delay its IPO process as a result.

However, looking at the bigger picture, this echoes the importance of data sovereignty advocated by $Palantir Tech(PLTR.US)'s Karp. If corporate data isn't properly restricted, it's essentially handing over the most critical assets to model providers. You'd be paying for tokens while the model providers learn your core business, thus losing the biggest AI Alpha. PLTR just released a Sovereign AI Playbook, which details how to avoid this situation.

Next step, SpaceXESLAAI 🐣

$SpaceX(SPCX.US)$Tesla(TSLA.US)

The biggest risk currently facing PLTR is not its performance, but its narrative. PLTR's performance remains excellent, but compared to last year's stock price decline, competitors have emerged in the market that may threaten its monopoly position. In the past, the market was willing to pay a high valuation premium for PLTR, recognizing its unique competitiveness in the toG market as the sole gateway to the OS operating system in the AI era.

However, entering 2026, both OpenAI and Anthropic have shown the potential to directly sign cooperation agreements with governments. Even if they still need to be integrated into PLTR's compliant data platforms such as Foundry, Ghothm, and Fedstatt, they still pose a competitive threat. This competition itself has shaken the monopoly expectation, thereby suppressing the valuation premium.

I think this is also the reason why Karp has been directly counterattacking recently. He is actively defining new competitive advantages, emphasizing that enterprises/institutions should possess data sovereignty that cannot be replaced.

$Palantir Tech(PLTR.US)

This article released by PLTR corresponds to Karp's recent interview on CNBC, expressing a similar viewpoint to the lengthy piece by Microsoft's Nadella earlier.

In the AI era, the core assets of an institution are data retention + weights/institutional knowledge + autonomous architecture; selling AI by token is hollowing out the customer.

Institutions must keep data, weights (institutional knowledge sedimented within the model), and decision-making power in their own hands; ceding sovereignty means giving up future options and alpha.

This is also PLTR's product philosophy: whose hands the data is in → who sediments the weights/knowledge → can the model be swapped without losing institutional memory → to whom does the value compound.

$Palantir Tech(PLTR.US)

I heard Burry's $Palantir Tech(PLTR.US) short position has already been closed.

Saylor announced a new active capital management framework on 6.29. Last week, through MSTR's additional share issuance financing, cash positions were restored. The framework consists of 5 parts:

- USD Reserve Policy (Build a $2.55 billion reserve, dedicated to preferred share dividends + debt interest payments, minimum coverage of 12 months, current reserve can cover 17.5 months)

- STRC dividend increased to 12%

- $1 billion credit line to repurchase preferred shares (STRC, etc.)

- $1 billion credit line to repurchase MSTR common shares

- BTC Monetization: $1.25 billion credit line to sell BTC to replenish reserves, pay interest, and fund repurchases

We previously discussed Saylor facing the bear market "impossible triangle" of "STRC 100", "BTC per share", and "BTC holdings". It now appears Saylor chose to first secure "STRC 100", and will maintain "BTC per share" through repurchases, while "BTC holdings" will shift from buy-only to active management. This is equivalent to Saylor acknowledging the fragility of the "only in, never out" pure Hold model under a structure with high fixed costs (high dividends), thus requiring the establishment of defensive tools.

From market feedback, it's clearly positive for STRC holders. After the dividend increase and cash reserve build-up, STRC's face value has also rebounded significantly.

For MSTR, the repurchase authorization is positive, but BTC monetization introduces potential selling pressure. However, in the short term, the risk of a blow-up FUD has eased somewhat, and MSTR has also rebounded strongly.

I believe upgrading from "simple holding" to an "active asset management strategy" greatly reduces the risk of a death spiral blow-up from being forced to sell coins at low prices during a bear market. The extreme narrative of "only buying, never selling" is less important than survival; not blowing up is the top priority. What BMNR can learn from this is that, although it doesn't have debt, interest payment pressure, or other blow-up risks, its mNAV has already fallen to 0.83, and the previously authorized $4 billion repurchase has also reached its theoretical execution window.

Active management encompassing strategies for common shares, preferred shares, USD reserves, repurchase discipline, etc., should be the next stage of evolution for all DAT companies. MSTR is once again leading the way.

$Strategy(MSTR.US)$Microstrategy Inc Pref Shares STRC 9.0 Perp(STRC.US)

$BitMine Immersion Tech(BMNR.US)