Apparently this week will also close in green. What would be positive for the second week in a row. Why so much optimism? Simple. Corporate income. In other words, despite inflation and “tapering”? the FED, Businesses make money. And that’s what has most of the weight. For investors, income comes first. We are about to make a great recovery. And good business results ensure growth.
The financial sector in particular is responsible for this hot streak. In other words, the banks had good numbers in their last reports. JPMorgan, Bank of America, Citi, Wells Fargo, Goldman Sachs and Morgan Stanley had better numbers than expected. The end of banking? I do not believe it. Macroeconomic and monetary concerns displace with good corporate incomes. As simple as that.
Now in the crypto space, we are all very aware of the price of Bitcoin. This time, the price tries again to break the large mark of USD 60,000. However, the task is not that simple. It’s not just about breaking it. Breaking open is relatively easy. What is wanted is an important and final break. It is still possible, but we need more strength. Anything to do with the possible approval of a Bitcoin ETF is fuel for this campfire. We need more fire.
Now let’s talk about the week’s most popular crypto news.
Never underestimate the power of greed. We are talking about a speculative project par excellence. It’s a meme coin inspired by a meme coin. Fundamental? I do not believe it. What we actually have is a fashion. We have a puppy, an Elon Musk, and a group of people looking for big wins. A small market with low liquidity and high volatility reacts explosively with the right promotion. What is the signal? Daddy Musks Tuis, the king of pump and dump.
I’m not saying here that buying Shiba Inu is a terrible idea. If you are looking for pure adrenaline pumping this might be an option for you. However, you have to be very careful. Don’t be naive. This is a very high risk investment. It is something that rises and falls violently. You can win, but you can also lose. It’s a highly speculative scheme.
We keep talking about the controversial Facebook currency. Everything sounds great. However, we come back to the same thing: regulation. Facebook with its own world currency is probably too much. I do not know. But the big stumbling block in this case is regulation. We’re talking about a gigantic global network that is perfectly intertwined. Now with your own coin?
Facebook is not on the cusp of popularity right now. What does that mean for sure Politicians will not get the project on the red carpet. It is known that the original project does not work. In any case, we would be talking about a fairly modified project. Could Facebook convince the regulators? What will the conditions be like? What countries are doing? Which country not?
The popularity of cryptocurrencies in countries like Argentina and Venezuela is closely related to the foreign exchange controls in those countries. I am referring to capital flight through informal channels. In other words, the black market for currency. Which implies that These restrictions are more an extension of existing currency controls than an attack on cryptocurrencies per se. It is the government that is trying to prevent capital flight.
The dollar is very popular in Argentina and Venezuela. However, the official route has many restrictions. So many are using the cryptocurrency market to get dollars abroad. In short, in these countries the dollar and cryptocurrencies are great allies.
Interestingly, many analysts misinterpret the volume data in these countries. It is contemplated that The popularity of cryptocurrencies in these countries is due to their high commercial acceptance. And there is no mention of its importance in the foreign exchange market.
It has always struck me that analysts seldom mention in this area dollar liquidity and investor optimism in general as important price variables. Apparently, Bitcoin is an island that is completely separate from the outside world. Monetary policy doesn’t matter. The economy doesn’t matter. Only the charts of the past and the halving are important.
Why so much blindness? Ideology. It is not easy for a crypto conservative to see that the price of Bitcoin is rising thanks to the policies of the Federal Reserve. Conservatives are often pessimistic because they are against the establishment. But ironically, the price of Bitcoin responds very well to optimism. This is the kernel. The solution so far has been to pretend Bitcoin is an island. Why is the price rising? The graph, the acceptance, the having and the offer. It is practically a sin to seek explanations in the outside world. Which is a pretty ridiculous practice. But the ideology is like that. And in this area it is ideology that is most abundant.
The proliferation of new games increases volatility. The incentive is always to focus on the new. Which means people are pulling away from the old games to go to the new games. As a result, instability is created. Investors know very well that the secret is to arrive early as games get less profitable over time. Before that it was Axie Infinity. Yesterday it was Plant vs Undead. And tomorrow will be different. The games business is like the restaurant business. There is a lot of competition. The new becomes fashion. But everything is going too fast. The new is always replaced by the newer.
In short, we have to expect volatility. It’s no surprise. It is our daily bread. More games will follow. AND Money will jump from place to place. The new becomes popular. And then the newer becomes more popular. Stability? Barely.