A New Leaf: Introducing Chuck's Corner

Any views expressed in the below are the personal views of the author and should not form the basis for making investment decisions, nor be construed as a recommendation or advice to engage in investment transactions.

Good morning kings. I am recovering from one too many Voodoo Rangers from this past weekend on this fine Thursday morning. Truly a timeless July 4th weekend tradition.

In spite of my hangover, I’m incredibly pleased to announce today that Mint Avalanche will be undergoing a rebranding of sorts - going forward, our weekly Thursday newsletter will be known as Chuck’s Corner. I’d like to share a quick timeline and thoughts on how we arrived at our decision.

Chuck’s Corner - A Monologue

When I joined Mint Media last year, AVAX NFTs were literally several weeks old. I still remember Smol Joes being maybe one of three total projects listed on the front page of Joepegs and convincing Wilson to ape in with me at 40 AVAX. Naturally we paper-handed, but we stuck around and grew with the ecosystem. It became clear to us pretty quickly that something cool was being built and we saw an opportunity to expand our content. Pretty self-explanatory.

As I’ve gotten my writing chops underneath me, I started to get an itch. One that could only really be scratched by writing about more. Not just Avalanche.

We had been kicking this idea around for a little while and decided to experiment with my last two newsletters. The feedback we received was overwhelmingly positive and cemented my decision to broaden the horizon. A key realization for me early on was that being able to write freely and concisely is critical to delivering good content. Wilson has done nothing short of an excellent job of that and I’m looking forward to following his lead.

With all of those things in mind, I’m excited to write about pretty much anything and everything now - it could be NFTs on ETH or AVAX, DeFi, macro - really whatever I feel like word vomiting about in a given week. That will be the essence of Chuck’s Corner going forward.

Most importantly, I want it to be engaging for as many people as possible and I promise I’ll do my best to achieve that.

It goes without saying that I thoroughly enjoyed writing a dedicated newsletter covering the Avalanche NFT ecosystem over the last ~8 months. Connecting and working with project founders and OG ecosystem natives has been awesome and I’m glad I was able to provide an outlet for broad-based coverage on what was happening and what was to come. I’m still fairly active in AVAX NFTs and am looking forward to numerous initiatives coming to fruition on behalf of Avalabs as well as existing and new project founders.

At my discretion, I’ll still cover AVAX NFTs if I think something particularly interesting is going on. Chuck’s Corner just won’t be entirely dedicated to that vertical going forward. We have some other things brewing in the background as well - be sure to stay tuned.

NFTs and Shitcoins - A Ballet of Musical Chairs

We can all agree that NFTs are speculative. We’re investing thousands and thousands of dollars into immutable pictures on the blockchain and somehow, the market has spoken and deemed many of these to be reasonably valued. If you take a step back, it does sound pretty absurd.

One thing I want to put on paper today is how beta quickly rises and falls between NFTs and shitcoins. Let’s just stick to ETH price action for this conversation. While very relevant and each remain key components of market sentiment, I won’t bring up the Blur farm drama or extremely high execution risk on part of project founders (e.g., Azuki Elementals), which can obviously also affect NFT floor prices.

To be candid, I haven’t been playing around much with NFTs this summer. ETH has been super skittish in the last 8 weeks: it shot up to $2100, went down to $1750 and is now back at $1900 as of this morning. When you have ETH whipsawing to this degree, the NFT market is unable to mentally peg the new “normal” price of ETH. This lack of foundation usually spells trouble for NFTs across the board and NFTs quickly become low beta relative to alts and very quick rotational shitcoin plays.

This is a key concept to understand and highlights how speculative NFTs really are as an asset class. Not only do they suffer on harsh down moves, but also on strong price action to the upside. Many NFT holders want their ETH back quickly to convert to stables to insulate themselves from downward market volatility OR they want to catch a move up and reap the benefits instead of staying illiquid. It’s a pretty tried and true pattern that has played out since NFTs have become “mainstream”.

Moments like these often set up for kingmaker trades. Particularly on a down move, it’s nice to be waiting in the wings to buy some ETH and catch a stink bid on a Pudgy or another relatively stable collection. I always have some USDC set aside for these volatile moves. Since NFTs are effectively leveraged longs on ETH (with the key exception of not being able to be liquidated), you can often find very compelling value trades shortly after some blood has been shed.

Shitcoins trade similarly. We all know the flow of funds when it comes to majors moving. When BTC and ETH move first, the market follows. Once people take profit there, they rotate into alts, followed by here. When BTC and ETH move down, people run for the door.

One thing to remember: if you are the first person out of the door, you’re not panicking.

Just a few things to keep in mind as you navigate this hellscape. Be nimble, be flexible, don’t be poor.

Conclusion

A quick and dirty start to turning over a new leaf. No better way to start my Thursday morning coffee.

Looking forward to bringing more of you into the inner sanctum of Chuck’s Cabal Corner. Enjoy the rest of the week.

Cheers,
Chuck