Earnio results for December 2024

Tomáš Hucík

We have completed the final month of 2024. Let’s take a look together at how we performed at Earnio and what the charts reveal.

One of the questions I’ve been getting quite often lately is, “How far can it go?” or, in the last two weeks, more frequently, “Will it go even higher?” The truth is that no one has a crystal ball. However, charts like these can help you decide which phase of the cycle we might currently be in.


Fear and Greed index

The first interesting chart is the Fear and Greed Index. The Fear and Greed Index is an indicator that measures market sentiment in the cryptocurrency space, showing whether fear or greed prevails, and it can help estimate potential price movements.

Currently, the chart shows a gradual sobering up. The index has shifted from "Extreme Greed" to a more moderate "Greed". We can see a cooling trend that has been ongoing for nearly two months. However, Bitcoin's price still remains above $90,000 per coin. The peak of the index in early December, shortly after Donald Trump’s reelection, was likely driven by an optimistic mood. But as I like to say, bread won’t get cheaper overnight.

For investors, this is a useful reminder to balance enthusiasm with careful evaluation of sentiment trends and fundamentals. The truth is, however, that Donald Trump's actions are filling cryptocurrency fans with optimism.

Source: alternative.me


Bitcoin ETF Inflows

Bitcoin ETFs, which are exchange-traded funds with Bitcoin as the underlying asset, recorded record inflows over the past two months. The capital inflows, which started with Donald Trump’s election (in fact, even a few days before, as the market began pricing in his favorable chances of winning), continued until the second half of December. Then, some outflows from these funds occurred, likely related to the end of the year when investors seek to optimize their income and expenses for accounting purposes.

From an external perspective, it is evident that Bitcoin ETF investors were not discouraged from entering the market even at the highest market prices—they repeatedly did so day after day. It is reasonable to assume that these investors are not aiming for short-term profit realization but rely on Bitcoin's long-term investment horizon and growth-oriented nature.


Rainbow chart

Do you know the Rainbow Chart?

The Rainbow Chart is a tool used to analyze Bitcoin’s long-term price trends (and other cryptocurrencies), using color bands (e.g., from purple for “undervalued” to red for “bubble territory”) to indicate whether Bitcoin is currently undervalued, overvalued, or in a neutral range.

The Rainbow Chart accounts for time by plotting cryptocurrency prices on a logarithmic scale against a timeline. Each color band gradually expands, reflecting Bitcoin's expected long-term growth trend based on its historical performance. In this chart, we are currently somewhere in the middle range.

This is interesting when you consider that Bitcoin’s price recently reached its peak. The question remains whether and when we will see a bubble similar to those in previous cycles. Most experts tend to agree that cycles will smooth out more over time. If this turns out to be true, it could be good news for long-term investors, as they may no longer have to endure such significant price swings.

Source: blockchaincenter.not


Bitcoin: Long Term Holder Supply

The Long-Term Holder Supply (LTH Supply) chart shows the relationship between Bitcoin’s price and the amount held by long-term investors. During price corrections, LTH Supply steadily increases, reflecting accumulation as investors see lower prices as buying opportunities. Conversely, during bull markets, LTH Supply often stabilizes or slightly decreases as some holders realize profits.

The overall trend shows steady growth in LTH Supply, indicating increasing confidence in Bitcoin as a store of value. This behavior supports Bitcoin’s cyclical nature, where long-term holders stabilize the market by holding through volatility. This chart may also provide an answer to the question of why price growth has currently stalled.

Source: https://www.bitcoinmagazinepro.com/charts/long-term-holder-supply/

As you can see from the chart, we are in a phase where long-term investors are partially selling their profitable positions. Opposing their sales are, for example, ETF investors entering the market (as described in the second section about Bitcoin ETFs). And here, you can clearly see the age-old principle that when there are more sellers than buyers, the price goes down.

Source: https://charts.bitbo.io/long-term-holder-supply/


Funding Heatmap

The Funding Heatmap is a visual tool that shows changes in funding rates on the cryptocurrency futures market, reflecting whether long or short positions dominate. The map displays how high the fees are that one side of the market (longs or shorts) pays to the other for holding open positions. When you look at it closely, you can see that around Donald Trump’s election, long positions clearly dominated the market, but the market has since calmed down and returned to a "normal" optimistic distribution.

Source: https://www.coinglass.com/FundingRateHeatMap

However, it’s not that simple.

At first glance, it really seems like not much has changed, but when you filter only for days when funding rates exceeded 10%, it starts to look like such days are becoming less frequent. This may signal some cooling of the market or at least a sobering up from the previous manic buying spree.

Source: https://www.coinglass.com/FundingRateHeatMap

There are so many charts and data to look at. What is included in this article is just a selection from those related to cryptocurrencies. In reality, there are many more. And if we also add macroeconomic charts, the non-crypto ones, just listing all of them would take several pages.


Let’s also take a look at how we performed in trading at Earnio.

If you read my articles carefully or follow us on Telegram, you know that we kept open positions (mainly on algorithmic strategies) that had been open since November. Part of these November positions was closed profitably within that month, while some continued into December.

These positions were gradually closed automatically during the last month, following the rules set for taking profits. At one point, my colleagues from the algo team and I discussed whether to manually close some positions, but the final decision was to stick to the strategies in place and trust the system, which has all positions governed by clear predefined rules.

Thanks to this, we are closing the last month of the year with a very nice profit of 7.16%.

Three programs of Earnio

At the moment, work related to the transition to a new product management system is fully underway, or rather, in its final stages.

Three programs will run in parallel:

  1. The closed Earnio FIX, for existing clients.

  2. The continuing Earnio Dynamic, where we are increasing trading risk to aim for higher potential returns.

  3. And the brand-new Earnio Horizon 3y.

Each of these products requires a different set of trading strategies.

Earnio Dynamic will focus on a truly dynamic approach, aiming to extract the maximum from the market and regularly deliver attractive returns, primarily through algorithmic trading, especially futures.

Earnio Horizon 3y, given its time horizon, will focus on longer-term trades and positions, primarily spot-based.

And Earnio FIX, in turn, is designed for stable, regular returns, continuing to utilize both trading and liquidity provision.


Because of these differences in strategy requirements, we are also dividing AUM and operational infrastructure. (This includes setting up sub-accounts on exchanges, dedicated wallets for individual programs, and more.)

And that’s precisely what our team is currently finalizing so that we can start 2025 in a truly big way.