With the crypto market in a "risk-off" phase, consider rotating funds into the tokenized gold asset PAXG as a defensive safe haven. For those seeking higher-risk opportunities, the decentralized exchange Hyperliquid is highlighted as an undervalued play benefiting from the commodities trading trend. Outside of crypto, focus on "picks and shovels" companies that provide essential infrastructure for the AI sector. The recent dip in Palantir (PLTR) is presented as a strong buying opportunity, as it is viewed as an oversold "AI operating system" with a massive order backlog. Similarly, Vertiv Holdings (VRT) is a key long-term investment for its data center solutions, though you may want to wait for a slight pullback before entering.

Bitcoin (BTC)

• The overall sentiment for Bitcoin is bearish in the short to medium term. The speaker describes the price action as "rolling over" and "not awesome at the moment."
• The speaker is not optimistic and believes the odds are high that Bitcoin will eventually go lower than its previous low of $59,000.
• A potential short-term scenario could see Bitcoin bounce to the mid-$80,000s before declining again.
• There is a CME gap (a price gap on the Chicago Mercantile Exchange futures chart) around $84,000. While these gaps have historically been filled 99% of the time, the speaker believes it is not an immediate price magnet and may not fill for months.
• A sustainable rebound will likely require a major shift in the economic environment, including lower interest rates and new regulations. The speaker does not expect this to happen overnight and anticipates a potential market bottom sometime in Q2.

Takeaways

• The speaker's view is that now is not the time to buy Bitcoin for long-term holds. Investors sitting on the sidelines with cash are advised to remain patient.
• For those holding Bitcoin, the discussion suggests the downtrend may continue for another one to three months, or possibly longer. Investors may want to consider hedging their positions or rotating into safer assets.
• Short-term traders might see an opportunity if the price bounces towards the mid-$80k level, but the speaker expects this to be a temporary move followed by another downturn.

General Crypto Market

• The crypto market as a whole is in a "risk-off" environment, meaning investors are moving away from speculative assets.
• The speaker states that if Bitcoin is struggling, other cryptocurrencies are unlikely to perform well unless they have a very specific, unique narrative driving them.
• This weakness is not due to fundamental issues with projects like Solana (SOL) or Ethereum (ETH), but rather a lack of liquidity and investor appetite for the entire crypto asset class.
• There is "no relief in sight" for most altcoins like SOL and Sui (SUI) until the broader economic conditions improve and favor riskier assets again.

Takeaways

• This is a time for caution in the broader crypto market. The speaker advises against expecting a recovery in most altcoins while Bitcoin remains weak.
• Investors are encouraged to take action to protect their portfolios. This could mean:
  • Hedging: Using strategies to protect against further price drops.
  • Rotating: Moving funds into safer assets within crypto (like PAXG) or outside of crypto entirely.
  • Cash: Increasing cash positions to reduce exposure and wait for a better entry point.

Hyperliquid

• The sentiment for Hyperliquid is bullish, as it is one of the few crypto assets with a unique narrative that is performing well.
• Hyperliquid is a decentralized exchange that allows users to trade commodities like gold and silver perpetual swaps on the blockchain.
• Its success is tied to the current strength in the commodities market, as it has become the go-to platform for "crypto degens" wanting to trade these assets.
• The speakers suggest Hyperliquid is "extremely undervalued" and "wildly undervalued" based on its trading volume, which is reportedly similar to that of Coinbase (COIN) but at a significantly lower market capitalization.

Takeaways

• For crypto investors looking for opportunities in a down market, Hyperliquid is presented as a strong candidate due to its unique connection to the popular commodities trade.
• While considered a strong play, it is still a volatile crypto asset. It is positioned as an option for those who want "a little bit of action on the side" rather than a safe haven.

PAX Gold (PAXG)

• The sentiment for PAX Gold is very bullish, presented as a defensive asset.
• PAXG is a tokenized version of physical gold, meaning its value is directly tied to the price of gold.
• It is described as a "safe haven right now for crypto," as it is in an uptrend against both the US dollar and Bitcoin.

Takeaways

• For crypto investors looking to reduce risk without exiting the crypto ecosystem entirely, moving funds into PAXG is presented as a primary strategy.
• It can be used to hedge a portfolio against further downside in more volatile cryptocurrencies like Bitcoin and other altcoins.

AI Sector & "Picks and Shovels" Plays

• The speaker is very bullish on the Artificial Intelligence (AI) sector but focuses on a specific strategy.
• Instead of investing in overcrowded, big-name tech stocks (Mag-7), the focus is on "picks and shovels" companies. These are the companies that provide the essential hardware and infrastructure that the entire AI industry relies on.
• A key metric for identifying strong AI plays is looking for companies with confirmed multi-year backlogs for their products or services, indicating sustained high demand.

Takeaways

• Investors interested in the AI boom should look beyond the obvious names like NVIDIA and Google.
• The real opportunity may lie in the less-known companies that supply critical components for AI data centers, such as cooling systems, power infrastructure, and specialized hardware.
• When researching these companies, checking their financial reports for evidence of a growing order backlog can be a powerful indicator of future success.

Palantir (PLTR)

• The sentiment for Palantir is bullish.
• The stock has recently declined, as it was grouped with traditional software-as-a-service (SaaS) companies that are seen as threatened by AI.
• However, the speaker argues that Palantir is more of an "AI operating system" for large corporations and is now "very oversold."
• Recent earnings were extremely strong, with revenue up 130% year-over-year and a major backlog of orders, confirming high demand.
• The company is also noted for its potential to secure a "monopoly on government contracts."

Takeaways

• The recent dip in PLTR stock is presented as a "good buy" opportunity.
• Investors should view Palantir not as a legacy software company, but as a core AI infrastructure play that is currently undervalued by the market.

Vertiv Holdings (VRT)

• The sentiment for Vertiv is bullish.
• Vertiv is a classic "picks and shovels" play for the AI sector. It is an industry leader in providing essential power and cooling infrastructure for AI data centers and server racks.
• The company just reported massive growth:
  • Year-on-year orders are up 250%.
  • Their order backlog has doubled.
  • Future guidance has doubled.
• As a result of this news, the stock gapped up 18% on the day of the podcast.

Takeaways

• Vertiv is highlighted as a solid long-term play on the physical build-out of AI infrastructure.
• While the stock saw a huge jump, investors are cautioned to "maybe not jump on this right away" as it could pull back slightly in the short term.
• However, the underlying business is exceptionally strong with years-long backlogs, making it a compelling investment for the long run.