We went from greed to fear in a matter of hours. And that didn’t just happen in the crypto market. Wall Street is the same. Skepticism is already growing. I mean, the euphoria is over. The correlation between Bitcoin and SP 500 seems brighter today than ever before. In other words, prosperity is good for us, not crises. And we go hand in hand with big tech. Further impetus will come before the US elections. That will bring the mood back to life.
Many present Bitcoin as an asset for the fearful. The “digital gold”. The “safe haven”. But the evidence suggests the fearful are taking refuge in the dollar and government bonds. Bitcoin is instead for the optimists. There is a risk. And risk implies volatility. But in volatility there is opportunity.
Now let’s talk about the most read news of the week
Well, here we come back (again) with the difficult task of commenting on this delusional fantasy. We need to reconsider this After Truth-Time cowboy movie. Max Keizer predicts wanderings out of nowhere and draws far-fetched conclusions from pure air. Max speaks of increases and decreases in price. That is fixed. The man is a walking Bitcoin sentiment indicator. I called it: the Max Index. The only indicator I know has never given me the wrong signal.
A few weeks ago, I commented on Max’s statements about Buffett who allegedly bought gold because he was disappointed with the system. Then I wrote something about the gold market. But Max keeps talking and his nonsense circulated in the press. In fact, I wrote a special article on the subject because the novel is not over.
Warren Buffet, one of the richest men in the world, gives up the dollar. What madness is that? Warren always said he’d rather own companies and stocks than cash. You really don’t like having a lot of money on your hands, but you are required to have a substantial amount to pay for your insurance policies. Additionally, in Berkshire Hathaway’s financial sector, the financial sector is one of the most important. Berkshire Hathaway is pretty much Apple, Finance, and various defensive stocks like Coca-Cola. What the hell is Max talking about? The man is insane.
Satoshi’s secret grows larger over time. Everything that is said about him raises more questions than answers. Meanwhile Satoshi is already a heavenly being and no one will believe anything that is said about him. All finds are actually small pieces of an infinite puzzle. The context is extremely relevant in these cases. And here much of the context is unknown. For example, many of us assume that Satoshi is a lonely hero who acts on the highest principles. So in our imagination we see an old Japanese who dismantles from his PC at home alone. But, What if Satoshi is indeed a government organization or a criminal organization? That would change everything.
I assume that one day Satoshi’s identity will be known. And suddenly he won’t be the wise old man we all hope for. It’s likely a big disappointment. A flesh and blood person could never be as ideal as a myth. An eternal secret is easy to idealize. It’s magical. And Satoshi today is as big as his secret.
Let’s be honest. All of these predictions rarely come true. In most cases these are people looking for more inches of press. Price predictions attract readers like nothing. They write that the price will go up to 50,000 in a few days and you have a headline that Google beats in seconds. People like to hear what they want to hear. Everything is a delusion.
It is very difficult to do a Bitcoin valuation. The problem is that we don’t have good data. For example, Facebook knows how many members your network has, what the exact growth rate is, and what money each member represents. This way you can estimate its size in a few years and its sales. The data is very relevant in the assessment.
How many Bitcoiners are we? What is our annual growth rate? How much money in Bitcoin does the average Bitcoin have? And what is the annual growth rate of that number? The Federal Reserve has all of this data in relation to the dollar. Where is the Bitcoin Foundation quarterly report?
The gold market consists of pure big leagues: governments, banks, financial institutions, institutional investors. In other words, half the planet has money in gold. You could say: I don’t have gold, but your government does. And this gold is everyone’s gold. Can Bitcoin build such a network in a few years? We will see. But saying it is not the same as doing it.
The world has ended since the time of Christ. It’s always the end of the world. We are always at the worst possible moment. According to libertarians and conservatives, we are on the verge of collapse and the system is no longer giving in. I read in the Warren Buffett biography written by Alice Schrolder that in the 1950s, Warren’s father Howard Buffett, an ultra-conservative man appalled by government interference in the economy, decided to buy a farm in order to to feed his family in the event of a collapse of the dollar. Warren put his money in his pocket. Well, apparently, optimism is more profitable than pessimism.
Critical point, of course, yes. This week was crucial for all markets. The honeymoon is coming to an end and the magic is coming to an end. Many on Wall Street are withdrawing their money and preparing for the next crash. Are we going to have a big crash before the elections?
The 12K resistance is very tough, but the good news is that the 10K support is solid. Despite the fact that we’re getting very close, the fight is there. It is very likely that we will recover and revert to the sideways trend above 11,000. For now we have to keep our fingers crossed.