📉 A 1987-Style Crash Is Coming?

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BlackRock and Libre are playing the same game — turning old-school assets into on-chain tokens and dropping them right into the heart of DeFi. Scroll down for more!

Here’s what we got for you today:

• ℹ️ Crypto Sources From The Crypto Fire ℹ️

• ⛔️ Jim Cramer Says a 1987-Style Crash Is Coming - …

• 🚨 Capital Cycle Theory: The Investment Framework …

• ⭐ 5 Things You Shouldn’t Miss

• 🤡 Meme Of The Day

ℹ️ Crypto Sources From The Crypto Fire ℹ️

⛔️ Jim Cramer Says a 1987-Style Crash Is Coming - Should We Take It Seriously?

If you’ve been around crypto or markets long enough, you probably know the name Jim Cramer. And you’ve probably seen the memes: whenever he calls something, the opposite usually happens.

But here’s the thing — no one’s wrong all the time. So let’s take a breath and actually look at what he’s saying. Because if he’s right, it pays to be ready.

1️⃣ What was Black Monday in 1987?

→ It was the worst single-day crash in U.S. stock market history. On October 19, 1987, the Dow Jones dropped 508 points — a 22.6% crash in just one day.
That day wiped out around $1.71 trillion globally. For perspective, that’s about the size of Bitcoin’s entire market cap today (~$1.9T).

The strange part? There wasn’t one clear reason for it. It was more of a chain reaction:

• Automated trading systems triggered mass selling.

• Macro problems: rising interest rates, widening U.S. trade deficit.

• Stocks were overinflated after years of gains.

• Add in investor panic, margin calls, and zero circuit breakers = full-blown disaster.

But unlike the 2008 crash or FTX in 2022, no major banks collapsed. And the global economy recovered within 1–2 years.

2️⃣ Could We Really See Another 1987-Style Crash? Are We in Danger Now?

There are definitely warning signs:

• Trump’s recent tariffs erased $5 trillion in global value almost overnight.

• If China bans rare earth exports (used in chips and EVs), it could disrupt global tech.

• If the Fed suddenly hikes rates again, debt-heavy companies could start dropping.

• Any major geopolitical shock (Middle East, South China Sea, etc.) could trigger panic.

• And if the EU or China retaliate with tougher export controls? U.S. industries could get hit hard.

So yeah — it’s not hard to imagine a sudden 20% drop in today’s markets.

But we’re also more prepared than in 1987:

• We have circuit breakers to pause trading.

• Central banks are more experienced now.

• Information spreads faster, reducing confusion and panic.

So while a crash like that isn’t impossible, the odds of a repeat are lower than they were.

3️⃣ Who Won Big in the 1987 Crash?

Meet Paul Tudor Jones - He saw similarities between 1987 and the 1929 bubble. So he shorted the market using S&P 500 futures.

When the crash hit, his fund jumped +62% in October and ended the year up +125.9%. That moment made him a legend.

Another example? Warren Buffett.

• He started buying Coca-Cola stock after the crash, around $2.74/share.

• He eventually scooped up 23.5 million shares (7%) of the company.

• Within 2–3 years, that position turned into billions.

Lesson: Crashes = opportunities for those with cash, patience, and a plan.

So What Can We Learn From This?
These days, we have better tools:

• Technical analysis is easier to learn.

• AI tools give faster insights.

• Trading strategies are more widely available.

But it’s still hard to predict the unknown:

• Black swans, stagflation, surprise wars or regulations — no one sees them all coming.

4️⃣ What Should You Do to Prepare?

Let’s look at history:

2017–2018:

• $BTC.X ( ▲ 0.62% ) : $20K → $3,122 (–85%)

• $ETH.X ( ▲ 0.69% ) : $1,400 → $85
  Then BTC rebounded to $14K, ETH to $366 (+300%+)

2022–2023 (LUNA/UST crash):

• $BTC.X ( ▲ 0.62% ) : $69K → $15,477

• $ETH.X ( ▲ 0.69% ) : $4,800 → $890
  BTC later broke its ATH to hit $109K, ETH climbed back to $4K

Point is:
After big crashes, big rebounds tend to follow.

So the best mindset is:
“The market will always surprise us. Keep USD ready.”

Also:

• Keep learning.

• Stay alert to news, macro shifts, and politics.

• Have a clear strategy — don’t trade blindly.

• Be calm when others panic.

A single click at the right time could mean huge gains or massive losses.

Trader Take:
Jim Cramer might be wrong (again)... or maybe not. But instead of betting on that, make sure you are positioned to stay safe, spot opportunity, and play the long game.

Because the people who made it big in 1987 weren’t lucky — they were prepared.

🚨 Capital Cycle Theory: The Investment Framework No One Talks About (But Everyone Should)

Ever bought into a “great” project and still lost money? Or watched the whole market go up… while your portfolio flatlined?

Yeah. You might’ve entered at the wrong point in the cycle.

Capital Cycle Theory — a strategy used by pros (like Marathon Asset Management) to catch hidden opportunities before the crowd, and avoid hype traps.

1️⃣ What’s the Capital Cycle Anyway?

This theory was developed by Marathon Asset Management (London) and detailed in the book Capital Returns (2015), edited by Edward Chancellor.

Unlike traditional investing that focuses on revenue or demand forecasts, this theory tracks capital flow — how money moving in/out of an industry impacts:

At its core, the theory states:

• High profits → attract excess capital → overinvestment → profits fall.

• Low profits → capital exits → underinvestment → profits recover.

→ This leads to mean reversion in returns. Success plants the seeds of its own downfall, and failure often leads to recovery. Most investors fixate on demand, but Marathon emphasizes supply and capital discipline as the real drivers of long-term returns.

The cycle has 3 phases:

• High Profits → Capital floods in

• Overcrowding → Too much supply, margins shrink

• Rebalancing → Weak players exit, the strong survive, profits bounce

And here’s the kicker:

📉 Stock prices reflect the past

📈 Capital flows point to what’s coming next

2️⃣ Growth ≠ Profits — Watch Capital, Not Hype

A common mistake?

📈 Seeing revenue go up and thinking “this is good.”

Here’s what usually happens:

• AI gets hot → everyone rushes in

• GameFi trends → everyone jumps in

But if the sector is overcapitalized, problems follow:

• Heavy competition → prices drop

• Massive hiring & spending → costs explode

• Revenue up, but profits disappear

👉 Marathon's approach helps spot the reversal, even when others are still chasing the hype.

Emerging markets (like China in the 2000s) often dazzled investors with crazy GDP growth rates.

But here’s what the capital cycle lens teaches:

• Rapid economic growth often attracts endless capital investment.

• When capital keeps flooding in, competition rises massively.

• Returns on equity (profits) shrink because too many players fight for the same markets.

Case study: China in the 2000s

• China's economy boomed.

• Yet Chinese stocks often underperformed or delivered disappointing returns.

• Why? Overbuilding, overcapacity, and thin profit margins killed shareholder returns, even though GDP numbers looked incredible.

The deeper principle:

→ Economic growth does not automatically equal good stock returns.

If an industry or country attracts unlimited capital, the profits for investors disappear due to oversupply and brutal competition.

3️⃣ What Makes a Great Company? Capital Discipline.

Marathon doesn’t care about “growth stocks” or “value stocks”. They ask:

• Does this company know when to stop expanding?

• Do they scale when it’s smart, not just because others are?

• Do they optimize capital, or burn cash chasing hype?

They bet on firms that say:

“We’ll grow when it makes sense. Not just because our rivals are doing it.”

4️⃣ How to Spot the Cycle Yourself

You don’t need to be a CFA. Just watch market behavior:

When it’s too hot:

• IPOs everywhere

• Startups scaling fast

• Everyone's “building”

  → Probably peak capital flow. Risk is rising.

When it’s too cold:

• Companies buying back shares

• Layoffs, shutdowns

• Silence in the media

  → Capital is drying up. That’s your chance.

Trader Take:

The crowd chases trends.

Smart investors track capital flow and move opposite.

Capital cycle theory isn’t just for economic historians — it’s a tool for forward-thinking investors.

This cycle-based thinking won’t just save your portfolio — it’ll make you early to the real opportunities.

Have you ever spotted one of these cycles in action?

⭐ 5 Things You Shouldn’t Miss

🚀 Arthur Hayes, CIO of Maelstrom, is doubling down on his bold prediction: Bitcoin will hit $1 million by 2028. He said it’s time to “go long everything” - he's bullish on both crypto and stocks.

Why? He believes the U.S. will need to flood the system with more dollars (like another round of quantitative easing), which could send Bitcoin and other assets soaring.

💎 Trump Media & Technology Group is thinking about launching a utility token for the Truth Social platform. It would be part of a rewards program, and at first, you could use it to pay for Truth+ subscriptions. Later on, it might also be used for other stuff in the Truth Social ecosystem.

📢 Libre is launching the Telegram Bond Fund (TBF) to tokenize $500M of Telegram debt on TON. The goal? Bring institutional Telegram debt on-chain and offer decentralized access to its fixed-income securities for the first time—with TBF usable in DeFi for yield, lending, and more.

🧾 BlackRock just filed to launch DLT Shares — a digital version of its massive $150B Treasury Trust fund. It’s one of the biggest tokenization plays yet by a U.S. finance giant and could speed up the shift to blockchain-based finance, RWA adoption, and even DeFi for institutions.

🌐 Arizona just passed SB 1373 - the Bitcoin Reserve bill - through the House, and now it’s heading to the governor’s desk.

🤡 Meme Of The Day

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This newsletter is for informational purposes only and should not be considered investment advice. Traders should conduct thorough research, understand the risks, and carefully evaluate their decisions before investing in cryptocurrency.