Posted on

Top Economist Calls Bitcoin As Legal Tender “Stupid”. Here’s Why He’s Wrong.

Let’s not kid ourselves, a person like Steve Hanke has enormous incentives to defend the status quo. He’s benefited tremendously from it. It could be argued that his livelihood depends on Bitcoin failing. A project to make it legal tender in any country goes directly against Hanke’s interests, and it’s no wonder he spoke against it. The insult was over the line, though.

We´re going to take the higher road and elegantly answer all of his points. The tweet in question was this one:

Is Bitcoin A Store Of Value?

Who decides this? The people. If one person uses an asset to safeguard his wealth, then it’s a store of value. The question then is, is Bitcoin an effective store of value? Well, considering it’s the only commodity in the history of the earth that presents absolute scarcity, it’s probably a safe bet. Make no mistake, though, it’s still a bet. The Bitcoin experiment is an ongoing process and nothing is set in stone.

Related Reading | Why Bitcoin Declared Legal Tender Could Have Major Implications Beyond El Salvador

Scratch that, one thing is set in stone. There will only ever be 21 million bitcoins. The supply is fixed, so if the demand increases, the price will go up. It’s as simple as that. To add credibility to the argument, let’s quote Saifedean Ammous’ “The Bitcoin Standard”:

Until Bitcoin’s invention, all forms of money were unlimited in their quantity and thus imperfect in their ability to store value across time. Bitcoin’s immutable monetary supply makes it the best medium to store the value produced from the limited human time, thus making it arguably the best store of value humanity has ever invented. To put it differently, Bitcoin is the cheapest way to buy the future, because Bitcoin is the only medium guaranteed to not be debased, no matter how much its value rises.

Did you know that 40% of all US Dollars that have ever existed were printed in the last twelve months? That’s what debasement looks like. And the whole world is feeling its effects. 

Is Bitcoin A Medium Of Exchange?

Our friend Steve Hanke was answering Paraguay’s congressman Carlos Rejala but, as you probably know, the first country to approve bitcoin as legal tender was El Salvador. This is not a coincidence, since “a real village with real Bitcoin uses in daily life” is right there in El Salvador. 

The Bitcoin Beach project is also the main real-life use case for the Lightning Network. If there’s a place in which small Bitcoin transactions are an everyday thing, it’s this one. As Nasdaq informed last year, when the project was still developing:

In the flagship Bitcoin village of El Zonte, for example, you can use bitcoin to pay for a haircut, get your nails done and chow down on some local dishes (like some delicious pupusas). Soon, you’ll even be able to buy a cup of coffee with it and go to the doctor’s office for a checkup.

If there’s any doubt that Bitcoin Beach was the inspiration for El Salvador’s historic move, Stephan Livera paraphrases what President Bukele said on Clubhouse: 

So yeah, Bitcoin is a proven medium of exchange with real-life use cases. We could include the incredible amount of Bitcoin transactions that the virtual world sees every day, but there’s no need.
BTCUSD price chart for 06/09/2021 - TradingView

BTC price chart on Bitbay | Source: BTC/USD on TradingView.com

Is Bitcoin A Reliable Unit Of Account?

Let’s admit it, Bitcoin’s price is volatile. Why is that? Let’s quote “The Bitcoin Standard” once again:

As it stands, given that Bitcoin constitutes less than 1% of the global money supply, large individual transactions in Bitcoin can have a large impact on price, and small variations in demand can cause large swings in price. This, however, is a feature of the current situation where Bitcoin as a global settlement network and currency is still a tiny fraction of global settlement payments and money supply.

Bitcoin is still in its infancy. You can’t ask a 12-year-old child to behave like an adult. What does it need to grow? Nurture. And since it IS a currency, nurture is equivalent to widespread adoption. This is exactly what’s happening, with all of these countries considering emulating El Salvador in making Bitcoin legal tender. 

Related Reading | Time To Pay Attention: Bitcoin Indicator Behavior Mimics Historic Rally

If Bitcoin becomes the global reserve currency of the world, volatility won’t be a problem. And the whole planet will be a level playing field because one country won’t have the immense privilege of issuing the global reserve currency. And debasing it at will.

Posted on

What If Elon Musk Is Just Making “Noob” Crypto Mistakes?

Is Elon Musk playing 4D chess or is he just making rookie mistakes? It’s easy to judge the unfortunate and inaccurate message those tweets contained, but, what if Elon simply doesn’t know better? What if the billionaire doesn’t have a master plan and instead is just learning right in front of our eyes? It’s certainly a possibility. At least that’s what TV personality and Bitcoin advocate Max Keiser thinks:

Even though Mr. Musk has been around cryptocurrencies for a long time, he’s only been into cryptocurrencies for a few months. Luckily for us, our sister site Bitcoinist is on the case from the very beginning. Let’s examine Elon’s history with blockchain-technology-related projects and try to figure out his master plan or lack thereof. It’s the least we can do.

Could Elon Musk Be Satoshi Nakamoto?

Three years ago, the billionaire had to respond to the world:

“Not true. A friend sent me part of a BTC a few years (sic), but I don’t know where it is,” he wrote in response to a recent blog post whose author, Sahil Gupta, said Musk was “probably” Nakamoto.
“Satoshi could be a collaboration of Musk, Nick Szabo, and Hal Finney. But it seems more likely that Elon read their research papers, took inspiration from them, and built the product solo,” Gupta had mused.

Even though back then Musk had nothing to do with cryptocurrencies, he was in the same orbit. And the crypto community tried to pull him in using various tactics.
DOGE price chart for 05/27/2021 - TradingView

DOGE price chart on Bitfinex | Source: DOGE/USD on TradingView.com

The CEO Of Dogecoin

Two years ago, the Dogecoin community crowned him CEO. As you might imagine, the coin registered its first Elon-pump: 

The effect on Dogecoin was immediate and decisive: as of press time, the altcoin had made daily gains against the US dollar of almost 35 percent.

DOGE/USD currently trades around $0.0033, its highest since early November.

Elon Musk quickly gained the attention of the cryptocurrency community on Twitter, with traders extrapolating potential endorsement of the wider industry beyond DOGE.

And even though Musk immediately resigned to the Doge CEO position, the relationship between the billionaire and the joke-cryptocurrency would prove to be stronger than anyone thought.

Related Reading | Goldman Sachs Exec Says Much Nope To Firm After Making Millions On Dogecoin

Elon Musk’s Initial Views On Crypto

A year ago, the billionaire finally spoke publicly about cryptocurrencies in his own “Third Row Tesla Podcast”. Bitcoinist reported:

He likes the concept and thinks that it is ‘clever.’ However, he also has concerns regarding their role in making illegal transactions. He said,

There are transactions that are not within the balance of the law. And there are, obviously, many laws in different countries. And, normally, cash is used for these transactions. But, in order for illegal transactions to occur, cash must also be used for legal transactions. You need an illegal-to-legal bridge. That’s where crypto comes in.

Oh, the “criminals use Bitcoin” argument. The first question every noob encounters. We hope that Elon already figured out that every transaction made stays engraved in the blockchain forever. And that fact is not ideal for criminals, as the DarkSide saga proves.

Tesla Adds Bitcoin To Its Balance Sheet

A mere four months ago, Bitcoin got the Elon-pump. His company was in the process of acquiring BTC and:

Elon Musk’s addition of “#Bitcoin” to his Twitter bio and potential buying activities undoubtedly played a huge role in this rally.

The coin went from $32K to $38K, and then it was up-only for a while. A few months later, Elon answered “true” to a tweet about Bitcoin and renewable energy. Bitcoinist reported:

An April tweet that proves that Elon had been thinking about the subject. Not only that, he agreed with Jack Dorsey when he made this statement: “Bitcoin incentivizes renewable energy.” Talk about a smoking gun.

A few weeks later, Elon announced in an infamous tweet that Tesla wasn’t accepting more Bitcoin payments for environmental concerns. And all hell broke loose. 

BTC price chart for 05/27/2021 - TradingView

BTC price chart on Gemini | Source: BTC/USD on TradingView.com

Maybe Elon Musk Has Not Done His Homework?

It’s hard to believe that Tesla invested more than a billion dollars in Bitcoin without researching the environmental part of the equation. But then again, while defending his position, Elon made clear that he doesn’t know the difference between the nodes and the miners:

While the fact that most miners were in China is not ideal, the nodes control the Bitcoin network. And those are spread all over the world. And anyone could start operating one by following a few easy steps, even you.

And then, just three weeks ago, he said the darndest thing about Dogecoin. Bitcoinist reported:

With his distinctive sense of humor, Musk finds it ironic that this nascent class, with the potential to be the world’s reserve currency, to be spearhead by a project that started as a joke. Musk said:

Which one it is going to be? Maybe it’ll be multiple, it should be considered speculation at this point. The point is that Dogecoin was invented as a joke, as essentially to make fun of cryptocurrencies. Fate loves irony, what it would be the most ironic outcome? That the currency that was invented as a joke, in fact becomes the real currency. To the moon!

That’s cute! Nevertheless, Doge fundamental characteristics make it an impossible outcome. The supply is unlimited and the system mints an absurd amount of new coins every day. If the world wants a perpetual-printing machine that devalues the holder’s coins by the minute, it already has the Fiat system.

And, mind you, the perpetual printing was the main part of the Doge joke. It seems that the punchline flew over Elon’s head.

Related Reading | Binance Burns Record $600 Million BNB In Its 15th Quarter

So, Could Elon Be Just Making Noob Mistakes? 

When a great mind accompanied by a big ego encounters Bitcoin, it immediately gravitates towards trying to fix it. Elon is not the first and will not be the last. Every great Bitcoin thinker out there had an Altcoin phase. They all thought that maybe a new idea had come along that made Bitcoin obsolete. 

Eventually, they all realize that Bitcoin is more of a miracle than a technology. That the economic incentives are right where they belong, and that it’s a machine with the potential of improving the world for everyone.

Maybe Max Keiser is right and Musk just isn’t there yet. 

If that’s what’s happening, we can probably count on his genius to figure all of this out.

Let’s hope he does it sooner than later.

Featured Image by Vitolda Klein on Unsplash - Charts by TradingView
Posted on

Crypto Capital Manager: Ethereum and Bitcoin Selloff Was A “Bear Trap”

Was the recent crypto crash bound to happen? Or was it engineered? Is the bull market over for good? Or is the market gaining momentum, preparing for big movements? Your guess is as good as ours, but Moonrock Capital’s Simon Dedic is of the opinion that weak hands got their foot caught in a bear trap. Once again, they fell for a rich man’s trick.

Before we explore the case further, let’s make sure we’re on the same page by consulting Investopedia’s description of what happens in a bear trap:

To increase demand and get stock prices to rise, institutions might push prices lower so that the markets look bearish. This causes novice investors to sell stock. Once the stock drops, investors jump back into the market, and the stock prices rise with the increase in demand.

And let’s read exactly what Dedic said:

So, were the sellers played?  Let’s find out.

Related Reading | The Level Bitcoin Bulls Must Reclaim To Defend The Worst Monthly Selloff Ever

Where were we before this possible bear trap?

A mere month ago, Bitcoin was going through a long consolidation period and Ethereum was booming. The “flippening” narrative returned and all eyes were on the upcoming hard fork “London,” which will make ETH a deflationary asset.  Then, the crypto crash happened. And of course, NewsBTC reported it:

A week ago, Ethereum was riding high after hitting a new all-time high of $4.4k. Since then, ETH has been caught in a downtrend, with things getting much worse due to the crypto crash.
At one point, at the height of the panic selling, the price of Ethereum dipped as low as $1.9k before wicking back up. That’s a 57% loss from its all-time high.

The situation doesn’t look as hopeless at the moment. Ethereum is on an uptrend and each coin costs $2.813 at the time of writing. 
ETHUSD price chart for 05/26/2021 - TradingView

ETH price chart on Kraken | Source: ETH/USD on TradingView.com

Where are Ethereum and Bitcoin right this minute?

The market looks healthy, even if it took a beating over the weekend. Both cryptocurrencies are slowly gaining traction at comparable speed. The ride feels stable now, and we all know what that means… surprises ahead. Coindesk has Steven McClurg, CIO at Valkyrie Investments, predicting what these surprises might be:

“Due to the law of large numbers, it takes many more users today than it did a year ago to increase activity on the bitcoin network to the point it drives the price higher,” said McClurg.  “ETH is getting traction due to ETH 2.0 and those staking their assets to the network in anticipation of proof-of-stake, taking out supply as demand comes in.”

Is he right? So far, stats and charts don’t show it. In fact, the trends are at the exact same level as when our sister site Bitcoinist called off the flippening:

Ethereum has still around 40% of Bitcoin’s market cap. And the percentage is exactly the same if we compare the active nodes. It already surpassed BTC in everything that has to do with transactions, from quantity to fees generated. And ETH is not even close in Google search interest and active addresses.

Related Reading | TA: Ethereum Faces Hurdles, Here’s What Could Trigger Strong Recovery

For a closer look at the stats, check here.
Bear Trap, The Flippening chart - Blockchain Center

The Flippening, Market Cap chart | Source: Blockchain Center

Did we fall into a bear trap, then?

If we did, we’re still in there. So, we don’t yet have the necessary perspective to make a call. Certain indicators point that way, though. For example, this crypto enthusiast seems to have identified a historical pattern:

And this whale is undecided but hopeful:

In any case, bear traps only catch amateurs. This has nothing to do with a diamond-handed person such as yourself. Still, it’s nice to know where we’re standing. Or, at least, to theorize about it.

So, $BTC to 100K and $ETH to 9K? Definitvely possible for us.

Featured Image by Kaylyn Mok on Unsplash - Charts by TradingView
Posted on

Reliving The FUD That Led To This Week’s Bitcoin Crash

It is the worst of times. It is the best of times. It is the age of fear, uncertainty, and doubt. Nevertheless, Bitcoin’s fundamentals remain intact. The project’s value is still there, despite the disastrous drop in price. It was all going so well. How did we get here? Actually, there are a lot of valid reasons. Let’s review all of the causes that lead to this FUD.

As you know, everything started through Elon Musk’s fingertips…

Tesla’s “Environmental Concerns”

When Bitcoin was on its way up, Elon’s company gave it the push it needed. Tesla announced ownership of $1.5B worth of Bitcoin that, apparently, remain on its balance sheet. The crypto community celebrated the move, profits followed. The coin’s legitimization seemed to take a step forward. And then…

Inexplicably, Tesla announced they were not accepting BTC as a form of payment anymore. Despite wild speculation, no one knows what happened. In his tweeted announcement, Elon cited “rapidly increasing use of fossil fuels for Bitcoin mining” as the reason. Few people inside the crypto community believed it. Everyone outside of it did. And even though Tesla clarifies they didn’t sell any of their Bitcoin, the FUD set in. And retail investors started selling.

If you want to learn about Elon’s real views on the matter and about everything the crypto mining industry is doing regarding green energy, head over to Bitcoinist, our sister site.

Related Reading | Bitcoin TA: Here’s What Could Trigger A Bullish Reversal Above $40K

China’s Tightening Up Its Bitcoin Policies

This generated lots of FUD. The People’s Bank of China seemed to announce clear and unfavorable rules regarding cryptocurrencies. Yahoo Finance reports: 

“This is the latest chapter of China tightening the noose around crypto,” said Antoni Trenchev, managing partner and co-founder of Nexo in London, a crypto lender.

Virtual currencies should not and cannot be used in the market because they’re not real currencies, according to a notice posted on the PBOC’s official WeChat account. Financial and payments institutions are not allowed to price products or services with virtual currency, the notice said.

Nevertheless, as with most things on this list, the announcement didn’t amount to anything specific yet. 

BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com

The US OCC Turns Its Eye To Cryptocurrencies

The newly announced Acting Comptroller of the Currency, Michael Hsu, revealed that the agency he presides, the Federal Reserve, and the FDIC are reviewing their policies on cryptocurrencies. This isn’t necessarily a bad thing, it might lead to clearer laws and stronger governmental support. Nevertheless, the FUD doesn’t mind that fact. 

Hsu’s statement to the Committee Of Financial Services reads:

Shortly after I started, I requested a review of key regulatory standards and matters pending before the agency. Those items include the 2020 Community Reinvestment Act (CRA) final rule and associated NPR related to performance benchmarks, interpretative letters and guidance regarding cryptocurrencies and digital assets, and pending licensing decisions. For each, the review is considering a full range of internal and external views, the impact of changed circumstances, and a range of alternatives.

Binance Under Investigation

The US government turned its eye towards Binance. Apparently, blockchain investigator firm Chainalysis found a pattern. It showed a considerably higher percentage of funds from criminal enterprises flowed through Binance, compared to other exchanges. Bitcoin Magazine reports:

The world’s largest cryptocurrency exchange, Binance, is under investigation by the U.S. Department of Justice and Internal Revenue Service (IRS), according to a report from Bloomberg.

“As part of the inquiry, officials who probe money laundering and tax offenses have sought information from individuals with insight into Binance’s business.”

Even though it’s just an inquiry and nothing might come of it, the FUD it generated within the community cannot be ignored. 

Related Reading | Market Sentiment Hits Low As Binance Has Largest Bitcoin Inflow Ever

India almost bans cryptocurrencies

A total crypto prohibition was on the table once again, but India’s lawmakers turned the ship at the last minute. Word on the street is that they’ll pass clearer regulatory laws instead. The Economic Times reports:

The central government may form a fresh panel of experts to study the possibility of regulating cryptocurrency in India, three sources privy of the discussions told ET. This comes amid the prevailing view that the recommendations by a committee headed by former finance secretary Subhash Garg in 2019 for a blanket ban on these assets had become outdated.

This new rumor arrived yesterday, but the FUD that a total ban inspires was around for a while. 

Is This A Coordinated Attack? Or Is The World Just Going Nuts?

We can’t confirm or deny this was a coordinated attack on Bitcoin and cryptocurrencies in general. Maybe the upper class, transnational corporations, and high rollers of all kinds want to buy your BTC at a discount. Market manipulation is as old as markets. But, maybe, this perfect storm of bad news is what happens when the best performing asset that the world has ever seen takes over the world’s headlines. All eyes turn to it, and all fingers start poking.

However…

Featured Image by Jasmin Sessler on Unsplash - Charts by TradingView
Posted on

What Elon Musk’s Vision Of The Dogecoin Moon Could Look Like

Is this what Elon Musk wanted? To constantly be present on every type of news outlet? The bastion of quality journalism known as Page Six reports that the billionaire, his rockstar girlfriend, and musical guest Miley Cirrus went to a Dogecoin-themed party. This was after Musk’s infamous Saturday Night Live hosting gig, a night that created all kinds of disasters. 

The party was at a hotel called Public, which opened just for the celebrities for the first time in 14 months. Page Six describes it as:

“It was a cryptocurrency-themed bash for Elon,” a spy told Page Six. “Ian opened it just for Elon and his guests. Girls were dressed as aliens, walking around with trays of Dogecoin cookies and cupcakes, and there were Dogecoin ice sculptures.”

To make things worse, a handler brought a Shiba Inu dog, a live Dogecoin logo. Other celebrities in attendance were actual comedian Chris Rock, SNL’s creator Lorne Michaels, Weekend Update’s Colin Jost, and South Park’s creator Matt Stone.

Related Reading | Dave Portnoy Buys SafeMoon, Says He Doesn’t Know Why

Panic Attack for Princess Peach

Apart from that, Page Six reports that Grimes was hospitalized the day after. She informed the public herself through her Instagram page. 

“Forgot to post these cuz I somehow caused myself to have a panic attack and went to the hospital yesterday which tbh was quite scary and I suppose it’s a good time to start therapy.” Grimes captioned the pics of her dressed as Princess Peach alongside musical guest Miley Cyrus.

Yes. That was Grimes as Mario Bro’s Princess Peach in a much-mocked sketch that made the rounds on social media after Elon Musk’s disastrous performance. It’s worth noting that the billionaire was one of the very few people that has been invited to host SNL without being an actor, comedian, musician, or performer of any kind.

Dogecoin price chart for 05/18/2021 - TradingView

DOGE price chart on Bitfinex | Source: DOGE/USD on TradingView.com

Financial victims of Elon’s Performance

Grimes wasn’t the only one affected that night. As NewsBTC reported, Dogecoin took a 30% dip after Musk’s performance:

In the run-up to last weekend’s SNL show, Musk was expected to mention Dogecoin, which he did during his opening monologue, and again during a Q&A describing it as a “hustle.” But markets reacted by selling off, tanking the price by as much as 30% at one point.

At the time, the tanking went down to $0.49 per coin. Nowadays, it’s even lower. Dogecoin trades at $0.47 at the time of writing. Of course, the coin is still affected by Elon’s takedown of the whole cryptomarket by announcing that Tesla wasn’t accepting Bitcoin anymore because of bogus concerns about its environmental impact. For more information about this matter, head over to Bitcoinist.

Related Reading | Coinbase Banks On Dogecoin Listing To Revive Stuttering Fortunes

Last but not least, Musk’s fortune also took a dive after people realized how unfunny he was. According to Forbes estimations:

The fortune of Tesla’s billionaire cofounder and CEO, Elon Musk, has plunged by more than $20 billion since Musk made his controversial appearance on Saturday Night Live last weekend.

Is this what Elon Musk wanted?

 Featured Image by Ganapathy Kumar on Unsplash - Charts by TradingView
Posted on

This Crypto Fund Manager Claims Bitcoin Drop Was “Capitulation”

It’s widely believed that even experts can only identify capitulation after it’s already happened. The thing is, in regulated markets, unscrupulous Billionaires/ Bond villains have the decency to manipulate the market behind closed doors. Traditional markets don’t have as strong a sign as infamous Elon’s tweet. 

The CEO of investment advisory firm Vailshire Capital Management, Dr. Jeff Ross, proposes the theory that Elon’s attack on the Bitcoin network generated a “short-term capitulation.” That means, everybody who was ready to sell their Bitcoin at the slight sign of trouble, already did it. The weak hands and short-term traders are out of the game.

Is this Bitcoin’s new bottom?

Of course, so far, the capitulation is just a theory. We can’t really be sure. But, if this is what’s happening, that also means that we’re seeing the new bottom of the Bitcoin market. And other indicators point in that direction. Capriole investment’s founder Charles Edwards identified a dip below 100 Simple Moving Average yesterday, which usually means one thing.

This, of course, has happened before. After 2020’s Bitcoin halving, capitulation hit the market and NewsBTC was there to ease everyone’s minds:

While “capitulation” sounds scary, especially since it has been affiliated with the late-2018 Bitcoin crash, it’s not exactly a bad thing.

As prominent finance podcaster and Bitcoin bull Preston Pysh explained in response to D’Souza’s analysis:

“During the 2016 halving, the price went sideways for 9 days and then had a 28% drop, and it took 100 days to get back to the halving price. Mentally prepare yourself for the efficiency cleansing and difficulty adjustment as the protocol prepares all passengers for launch.”

Related Reading | Was Bitcoin Crash Orchestrated? These 4 Theories Scream Beware

So, summarizing, if capitulation happened and we’re watching a new bottom, we might see the world’s favorite digital asset bounce and climb to new and incredible heights.

BTCUSD chart for 05/15/2021 - TradingView

BTC price chart on Bitstamp | Source: BTC/USD on TradingView.com

How will Bitcoin bounce after such a catastrophic capitulation?

This is the easiest question to answer. And with it, we can also answer another burning question: Did Tesla not do their due diligence before investing more than $1B in BTC? Did Elon just find out about the supposed dangerous levels of energy consumption that the Bitcoin network needs to secure itself? Probably not.

For a possible explanation, we give the mic to Mark Yusko, Morgan Creek Capital Management’s CEO:

Related Reading | Lesson Learned: Teacher Loses Life Savings To Elon Musk Bitcoin Scam

Bitcoin will bounce back with institutional money snatching every coin from scared retail investor’s hands. In fact, the process is probably already happening.

Other theories about Elon Musk’s possible motives include Tesla trying to get tax breaks from the US government’s green policies and that this is the rollout for a renewable-energy-powered mining rig. To learn more about both, jump to our sister site Bitcoinist.

Featured Image by ShutterStock - Charts by TradingView
Posted on

Bitcoin Supply Lights Up With Activity Due To Trading Range Boredom

This three-months-and-counting consolidation period Bitcoin is in has many investors with the finger on the trigger. Even though we’re in the middle of an Altseason of sorts, mainly caused by the lack of price fluctuation Bitcoin is exhibiting, the hunters seem to be ready. A recent Arcane Research report shows that, in the last year, a whopping 8.45 million BTC have circulated. That’s 45% of the total circulating supply changing hands or, at least, wallets.

The last active supply circulation peak happened on February 23rd, 2018. At that time, 59% of the total was moving around. That was two months after the peak of the bull market. But, as Arcane Research points out, “We are still far away from the peak of the 2017-2018 era, both in terms of percentage and also in absolute values.” This means we could be on the verge of a new high octane ride.

Bitcoin active supply on the rise, chart

Bitcoin is on the move | Source: Arcane Research

The larger the consolidation period, the bigger the uptrend

On a previous time that Bitcoin’s price flatlined, NewsBTC reported on an analyst’s prediction that came true with a vengeance.

Bitcoin could be on the cusp of seeing some massive momentum in the mid-term.

He is even setting his sights on a move to $40,700, which may act as short-term resistance.

“This consolidation on $btc has given more breathing room for our *allowed* mean reversion cushion. We could pump to 40.7k and still be within the accepted reversion band level above the basis. TLDR: Bullish on more upside for bitcoin soon.”

And over at our sister site Bitcoinist, they reported on a prediction of an imminent long-squeeze that also came true:

Bitcoin’s short-term upside potential is currently being hampered by the high funding rates for leveraged positions.

This could indicate that being long is an incredibly crowded trade and that a Bitcoin long-squeeze is imminent.

“TWAPs & daily opens seem to be really important these days. Funding is getting pretty high again though, so I don’t think there’s a whole lot of room for further upside.”

When the price fell, liquidations were brutal and wiped out Billions worth of contracts. The futures market broke all kinds of liquidation records, as traders were clearly overleveraged. That means that the road is clear. And the fear of inflation is not going anywhere:

The richest individuals in the world are now buying Bitcoin to prevent their wealth from evaporating into thin air. And if inflation expectations are only now breaking out from a ten-year downtrend, Bitcoin’s uptrend might only just be getting started.

BTCUSD 05/12/2021 - TradingView

BTC price chart on Bitbay | Source: BTC/USD on TradingView.com

Are we being too optimistic?

Despite all those signs, nothing’s guaranteed. The trading range has been thin for months and Bitcoin’s current active supply might be on the move, but other factors might be at play. And, as NewsBTC reported, a “reset” might come sooner than later. 

According to cryptocurrency analyst Dave the Wave, who has supplied accurate analysis to the community through his Twitter soapbox for years now, Bitcoin could be looking at a strong “reset.”

Things might have taken off too quickly and too powerfully for Bitcoin price this time around, causing the LMACD to become overextended and brushing up against a long-term trendline.

It should be noted that Dave the Wave thinks that, after the possible reset, we’re “off to the races again.” So, the point is that even though the sea seems calm right now, we’re bound to see incredible action soon. The stage is set for a storm of epic proportions. And Bitcoins are moving around waiting for the right time to… move even more.

Featured Image by alessandro fazari on Unsplash - Charts by TradingView
Posted on

Treasury Management Firm Says CFOs Avoid Risk, Bitcoin Won’t Become Corporate Vehicle

If you need reassurance on just how early you’re to Bitcoin, head to Fortune.com. They interviewed the managing director of Treasury Partners, Jerry Klein, to find out if corporations are thinking about Bitcoin as a store of value. Short answer, “Not one of our clients has expressed interest in Bitcoin.” Good to know. But let’s explore further.

Related Reading | Stone Ridge’s 10k Bitcoin Bet Shows Changing Sentiment of Corporate America

The article begins with alliteration and dishonesty:

“The lead cryptocurrency so far offers practically no practical uses.”

Is the implication here that, for example, instantaneous wealth transfer is not practical enough? We consulted the linked article to find out exactly what the author meant. It starts with:

“In reality, Bitcoin has flopped as a vehicle for buying things, and it failed in its first big test as a safe harbor during the past year’s stock market crash.”

Oh yeah? Let’s ask the people with strong hands that held on to their Bitcoin until today. Are they not satisfied with Bitcoin’s performance? There’s turbulence, but the harbor is safe. And about the other point. nobody wants to be the next person who pays 10.000 BTC for two pizzas. Bitcoin is and will be in price discovery phase for the foreseeable future. Buying things with it is not a priority.

BTC Price chart, the last year - TradingView

BTC price chart for the last year on KuCoin | Source: BTC/USDT on TradingView.com

But let’s get back to corporate cash

According to Klein, his client’s portfolios usually consist of three kinds of investments: government bonds, money-market funds, and corporate stocks. Klein claims that their priorities are safety and liquidity, and that risk is out of the question. Furthermore, the article continues, “companies want to avoid owning assets that risk even the slightest decline in value.” 

Oh yeah? Isn’t Fiat currency in the United States devaluing at a 15% annual rate? Doesn’t that pose a risk of its own? To drive the point home, let’s quote the pioneer of displaying Bitcoin in the company’s balance sheet. MicroStrategy’s CEO Michael Saylor recently told Time magazine: 

“If you’re going to make a rational investment decision today, whether you’re a real estate investor, a stock investor, a bond investor, or just a wage earner or you’re a treasurer, you have to estimate the rate of monetary expansion for the next eight years. We know there’s a commitment to run deficits, and we know this commitment to stimulus.”

That means the US government is printing money like there’s no tomorrow. And will be for the foreseeable future. 

Related Reading | This is why all companies should buy Bitcoin, says Square’s CFO

You’re early to Bitcoin

Among the crypto community, there is a fear that the arrival of MicroStrategy, Square, and Tesla means that it’s corporations time. That the head-start that Bitcoin gave to the little people is over. Fortune.com’s attitude while handling the subject suggests that the crypto community might be wrong. Big institutions have no idea what’s going on. You probably have more time to stack those Sats. 

And that is a good thing.

Featured Image by Josh Hild on Unsplash - Charts by: TradingView