Ten31 Timestamp 903,081

• With World War III on hiatus (rumor is the next season will only be available to Truth+ subscribers), we can finally get back to what really matters: pumping stockholders’ bags. After much consternation, hand-wringing, panic-selling, and doomsaying, the S&P500 officially broke a new all-time high once again this week, just a few months after President Trump delivered his infamous Rose Garden Massacre that drove a sharp correction while threatening to massively disrupt global trade and capital flows. For the moment, the administration appears to be taking its foot entirely off the trade war gas pedal, as President Trump dismissed the upcoming July 9 trade deal deadline as a non-binding milestone, and the Treasury Department forced the rollback of a proposed income tax on foreign holdings of US assets (the latter of which hadn’t gotten much mainstream airplay but would have put pressure on foreign trade surplus recycling into US markets, and by extension Costco’s 60x earnings multiple). Meanwhile, the Wall Street Journal’s Fed Whisperers floated the idea that Trump is close to announcing his pick to succeed Jerome Powell almost a year early, potentially turning Powell into a lame duck Fed Chair as his successor appears weekly on CNBC to promise lower rates SoonTM, which will be increasingly crucial if Trump’s One Big Beautiful Bill becomes the law of the land. Overall, the administration appears to be shifting firmly back into a stimulative posture, at least until an MSNBC reporter finds a way to imply that rising asset prices call into question Trump’s masculinity.

• As liquidity tailwinds pick up, the regulatory backdrop for bitcoin seems to be ticking steadily up and to the right as well. This week, Texas became the second US state to formally enact a strategic bitcoin reserve, which will start with a seed position of $10 million. At the federal level, the Federal Housing Finance Agency directed Fannie Mae and Freddie Mac to begin formally considering borrowers’ bitcoin holdings in-kind when underwriting mortgage applications – opening the way for bitcoin holders to more easily tap into their wealth without selling the world’s scarcest asset – and the Federal Reserve formally removed “reputational risk” from its bank examination criteria, following similar moves from the FDIC and OCC this year. Finally, the Ten31 team spent some time in Washington at the Bitcoin Policy Summit this week talking to legislators and regulators, and it’s clear to us that the regulatory tenor is continuing to shift more robustly in bitcoin’s favor at the highest levels of policymaking. With both long-term market and regulatory trends supporting bitcoin in ways that would have sounded like Bitcoin Twitter fanfiction just a couple years ago, we remain extremely optimistic about the prospects for both the asset and the ecosystem in the near to medium term.

Portfolio Company Spotlight

StatMuse is a platform for online search powered by proprietary natural language processing (NLP) technology purpose-built to answer trillions of conversationally phrased queries. Users can query StatMuse with highly specific, conversational searches and receive instant answers rather than scrolling through databases or parsing through less relevant articles produced by traditional search tools. StatMuse was well ahead of the curve in its approach to natural language search, integrating this model years ahead of Google, and now offers an unmatched repository of sports data on the NBA, NFL, MLB, and more. The site also offers a rapidly growing data set for finance queries and has an exciting pipeline of new features.

Selected Portfolio News

• StatMuse launched its Android app:

• Strike announced several new security upgrades for its mobile app, including enhanced 2FA and passkey support:

Media

• Strike Founder and CEO Jack Mallers delivered a powerful keynote address about bitcoin’s fundamental ethos and value proposition at this year’s BTC Prague conference.

• Battery Finance Founder Andrew Hohns gave a speech at the Bitcoin Policy Summit outlining the ways BitBonds and other bitcoin-centric initiatives can benefit many different groups of Americans.

• Ten31 Principal John Arnold and AnchorWatch Co-Founder Rob Hamilton participated in a panel on policy challenges for bitcoin companies at the Bitcoin Policy Summit.

• Ten31 Managing Partner Matt Odell joined the Trust Revolution podcast to delve into key new developments in freedom technology.

• Coinkite Co-Founder NVK appeared on the TFTC podcast to discuss the latest in bitcoin self-custody and technology.

Market Updates

• As benchmark US interest rates remain increasingly out of step with those of other developed countries, Fed Governor Michelle Bowman – who just a few months ago indicated the central bank needs to see more progress on inflation before cutting – said this week that she now supports a cut as soon as next month, echoing comments from fellow Fed official Christopher Waller from last week.

• However, Fed Chairman Jerome Powell’s Congressional testimony once again foregrounded his central focus on the risk of potentially resurgent inflation, a stance that got some incremental support from Friday’s higher than expected core inflation report of 2.7% Y/Y.

• Entrenched inflation or not, President Trump’s public repudiations of Powell have only escalated since the start of Trump’s second term, and Fed insiders at the Wall Street Journal reported this week that Trump is close to announcing his nominee to replace Powell almost a year early, potentially initiating the “Shadow Fed Chair” plan endorsed last year by Scott Bessent.

• When asked again this week about his choice for Powell’s successor, Trump reiterated that whoever it is will be “someone who wants to cut rates” and that he’s not going to consider anyone who would hold rates where they are.

• While the Fed may still be resisting accommodation to Trump on rates, the central bank did make one key move in the expansionary direction this week by formally proposing – as previewed in this newsletter and elsewhere for months – to lower bank capital requirements associated with holdings of US Treasuries, potentially freeing up capacity for more banking system absorption of US debt.

• This should be a welcome development to the Ways and Means Committee, as the One Big Beautiful Bill – which Trump is still pushing to pass by July 4 – looks set to put even more upward pressure on federal deficits over the next decade and beyond.

• Amid the geopolitical and Fed headlines, it would be easy to forget that the US is ostensibly still in the middle of a massive trade war, though the Trump administration appeared to soften on many points of that agenda this week, as Trump indicated flexibility on timing, noting the July 9th deadline for new deals is “not critical” and “we can do whatever we want.”

• Stephen Miran, head of Trump’s Council of Economic Advisers, similarly suggested that there’s no reason for tariff rates to go back above the 10% baseline level even after July 9th for any countries “negotiating in good faith.”

• Apparently that qualification doesn’t apply to Canada, with whom Trump terminated trade talks this week due to conflicts over the country’s taxes on US tech companies.

• Elsewhere in trade policy arcana, Treasury Secretary Scott Bessent successfully pushed for the removal of a provision in the Big Beautiful Bill that would have revived income taxes on foreign holders of US assets, a wonky but significant rule that seemed geared toward attacking the US’s capital account surplus (the opposite side of the country’s trade deficit).

• On the back of all these headlines and the avoidance of an escalation in the Middle East, the DXY Index hit a new YTD low as US equity indices once again reached new all-time highs, more than fully recovering from the carnage of Liberation Day.

• Bitcoin mining network hashrate saw its largest decline in three years this week and is down 15% from two weeks ago, likely the result of demand response programs in Texas that have curtailed power supply to many large mining farms in response to the recent US heatwave.

Regulatory Update

• Texas Governor Greg Abbott signed the state’s strategic bitcoin reserve bill into law, making Texas the second state in the US with a dedicated, proactively accumulating bitcoin reserve. The state will inaugurate the reserve with a $10 million starter allocation to bitcoin.

• Arizona also passed a bitcoin reserve bill specifically for bitcoin seized as part of law enforcement actions. The bill now awaits signoff from the state’s governor, who previously vetoed a bitcoin reserve bill earlier this year.

• The Federal Reserve eliminated “reputational risk” – criticized by many companies as a means of exerting implicit pressure on US banks not to work with the bitcoin industry – as a component of its bank supervision process this week, following similar decisions by the US’s other two main banking regulators (the FDIC and OCC) earlier this year.

• Federal Housing Finance Authority head Bill Pulte indicated this week that the agency would look into the use of bitcoin and other digital assets as part of borrowers’ mortgage applications. Just a few days later, the FHFA formally ordered Fannie Mae and Freddie Mac to begin considering bitcoin holdings as part of the mortgage evaluation process.

• The Bitcoin Policy Institute hosted its third annual Bitcoin Policy Summit in Washington this week, including headline panels and presentations from Senators Cynthia Lummis and Marsha Blackburn, Congressmen Tom Emmer and Nick Begich, and SEC Commissioner Hester Peirce, all of which pointed to continuing growth in federal understanding and acceptance of bitcoin.

• At the summit, DOD official Patrick Witt indicated the US has an "accumulation plan” to build its bitcoin reserve over time.

• Elsewhere on the Hill, Senate Republicans unveiled a digital assets regulatory framework bill aimed at defining regulatory authority for the SEC and CFTC.

• In a press conference this week, President Trump reiterated his affinity for bitcoin, including the interesting comment that it “takes a lot of pressure off” the US dollar.

Noteworthy

• AI infrastructure giant CoreWeave is reportedly in advanced talks to acquire Core Scientific, the once-bankrupt bitcoin miner that partnered with CoreWeave in a major hosting agreement last year.

• The Wall Street Journal ran a profile on the Kingdom of Bhutan’s recent embrace of bitcoin and bitcoin mining, noting the small country now holds a bitcoin reserve well north of $1 billion (or roughly 40% of the nation’s GDP).

• The EU released a report urging the creation of a new “savings standard” to draw money out of bank deposits and into capital markets to “finance EU priorities.” Remember, it’s only a savings standard if it comes out of Brussels – otherwise, it’s just a sparkling bail-in.

• Elsewhere, Canada introduced new legislation to ban businesses from accepting cash payments of more than $10,000 while ramping up warrantless data collection requirements on customer accounts.

Travel

• Nashville Bitdevs, July 8

• Austin Bitdevs, July 17