₿ Bitcoin Dominance Leaves Altcoins in The Dust

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What’s on the Menu 🍴

Insight into practices to grow your dough are worth their weight in gold.

Today we’ve got some insights that’ll help you see the markets (and financial decisions) more clearly.

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• Bitcoin Dominance Leaves Altcoins in Dust ₿

• New CEO Gives Starbucks a Jolt ⚡️

• Is Your Home Equity A Retirement Time Bomb? 💣

Today’s newsletter is a 5 minute read.

Bitcoin Dominance Leaves Altcoins in Dust ₿

The Bitcoin dominance chart is sending a loud and clear message:

Bitcoin is the king of the crypto jungle, and it's not relinquishing its throne anytime soon.

Since the start of the 2023 bull market, Bitcoin dominance has been on a steady climb, now sitting comfortably above 57%.

This metric, which measures Bitcoin’s market cap relative to the entire crypto market, tells us a crucial story—Bitcoin is outperforming most altcoins.

Despite many altcoins seeing gains in fiat terms, they’ve largely underperformed when compared to Bitcoin.

In simpler terms, if you’ve been holding altcoins instead of Bitcoin, you’ve likely missed out on better returns.

Why is this happening?

The shadow of the FTX collapse still looms large over the crypto space.

Investors are skittish, preferring the perceived safety of Bitcoin over the volatility of altcoins.

Bitcoin’s status as the “digital gold” is appealing in uncertain times, while many altcoins are still struggling to regain trust and momentum.

Could this dynamic shift?

Possibly, but it would require a significant catalyst.

You see, Altcoins historically have their moments—often dubbed "alt seasons"—when they significantly outperform Bitcoin.

But for this to happen, the market needs to regain confidence, and there needs to be clear, strong use cases for these altcoins that set them apart from Bitcoin.

The bull case for altcoins hinges on innovation and adoption—think about platforms like Ethereum that power decentralized finance (DeFi) or gaming tokens that fuel Web3 ecosystems.

But until that innovation translates into real, widespread use, Bitcoin’s dominance is likely to continue.

The bear case?

Continued regulatory pressure, lack of adoption, and more market shakeups could keep altcoins in Bitcoin’s shadow for the foreseeable future.

New CEO Gives Starbucks a Jolt ⚡️

Starbucks stock (ticker: SBUX) rocketed higher by 25% on Tuesday, after the company announced the hiring of Brian Niccol as its new CEO.

The coffee chain saw its market cap rise by more than $20 Billion and the stock is now up on a year-to-date basis after being down as much as 24% at one point.

It’s rare to see this level of stock movement on a large cap stock merely due to an executive change.

So why did investors get so excited about the hiring of Brian Niccol?

For one, Niccol comes over from his previous stint at Chipotle (ticker: CMG), one of the best performing stocks of the last 5-10 years:

At Chipotle, Niccol helped successfully navigate the company through a major turnaround in the wake of Chipotle’s E-coli outbreaks back in 2015.

Chipotle returned to robust and sustained growth by fixing supply chain issues, focusing on product quality, and introducing new innovations in its stores.

At Starbucks however, Niccol’s job will be much tougher…

Starbucks is a much larger existing business than Chipotle, with stores across the globe.

Moving the needle on revenue growth is a real challenge, and it’s made more difficult by numerous factors including:

• Fierce competition from chains such as Dunkin, Dutch Bros, Luckin, etc

• A more cautious consumer environment

• Steep revenue declines at Starbucks cafes in China

• Staffing & mobile ordering bottlenecks in US cafes

Thankfully for Niccol, he has support from Starbucks founder Howard Schultz as well as investors (for now).

He also inherits a strong brand with a robust rewards program, something that Chipotle also leveraged to immense benefits.

Still, we wouldn’t be surprised to see SBUX stock give back some of Tuesday’s huge gain in the weeks ahead.

There’s tough work ahead for Brian Niccol and Starbucks, and we won’t have a great gauge on progress for at least a few months.

Until then we’ll keep an eye on SBUX stock as pumpkin spiced latte season quickly approaches! 🍂

Is Your Home Equity A
Retirement Time Bomb? 💣

Tapping into your home equity can feel like a quick cash win, but if you're not careful, it can turn into a retirement nightmare.

While using home equity in your younger years might be a savvy move, doing so later in life can put you in a financial bind that’s hard to escape.

When you pull equity from your home, you're essentially taking out a loan against your house, which means you'll be adding or extending mortgage payments.

That might be manageable now, but once you hit retirement, that extra financial burden can feel like an anchor dragging you down.

Home equity is being tapped again after years of loans declining:

This is likely due to the high housing appreciation seen since 2020 combined with a consumer that is starting to slow down and need help with debts.

Most Americans hold their wealth in their home, so, it’s where they’re likely to head in a bind.

One of the biggest risks?

Staying in the habit of tapping into home equity as you approach retirement can leave you with a perpetual mortgage payment, even when your income is fixed.

Imagine being 75, living on Social Security and whatever’s left in your 401(k), but still having to shell out a chunk of cash every month to keep a roof over your head. Ideally, you want to be free of a housing payment burden by then.

There’s no denying the benefits of accessing home equity when it’s done strategically.

Paying off a high-interest credit card or funding a necessary home improvement can save you money and increase your home’s value.

But the key is timing. Doing this in your 30s, 40s, or even 50s gives you time to pay down the balance and still build up your equity again.

But once you’re nearing retirement, the risk outweighs the reward.

In retirement, the name of the game is reducing expenses, not increasing them.

So before you think about pulling cash out of your home, ask yourself: Is this a move that sets me up for a comfortable retirement? Or am I putting future me in a financial pinch? The answer could be the difference between a stress-free retirement and one where you're scrambling to make ends meet.

Food For Thought 🧠

"Do not wait to strike till the iron is hot, but make it hot by striking.”
- William Butler Yeats

DISCLAIMER: We are not investment advisors, and this content is for educational purposes only. We don’t offer financial, legal, or tax advice. Nothing we say is a recommendation to buy or sell any assets. Trading and investing are extremely risky, so please be careful and do your own research.