The big event of the week. The arrival of PayPal, which has served as a great catalyst for the price of Bitcoin. When it comes to price, we’ve been hit hard by the events outside of the community lately. Impulses, macroeconomics, politics, etc. But this message is ours. That’s very good. Yes, there are reasons to celebrate. And yes, there are many reasons for optimism.
Now let’s talk about the most read crypto news of the week
The dream of many is to see Bitcoin as the great form of payment of the future. This is definitely Roger Ver’s dream. I mean, Mass adoption. By “adoption” we mean, of course, the use of Bitcoin as a means of payment in retail. Kind of a libertarian PayPal. In other words, with Bitcoin we can buy a coffee or the market. However, Is that really Bitcoin? One way of payment?
In this case, price stability would be essential and the most relevant number would be the number of traders accepting Bitcoin. In this scenario, the scalability of the technology would be critical. However, the reality seems to be different. Bitcoiners seem interested in price spikes more than just adoption. This could indicate that more than one payment method is a primarily speculative asset used for investing. Although we can sell bitcoin to buy things the same way we can sell our stocks for the same purpose, the average user sees bitcoin as an investment, not a means of payment.
It is entirely possible to have almost all of our assets in Bitcoin and regularly purchase a fiat currency for our daily payments. In this case, Bitcoin would be extremely useful, and at the same time commercial launch would not be as relevant.
Of course, this PayPal decision has great symbolic power. because it’s some kind of recognition that gives crypto a lot of legitimacy. Plus, it’s a good thing to only be exposed to PayPal’s 300 million plus users. However, it is important to note that Bitcoin needs more buyers, not more sellers. As an investor, it is ideal to encourage investments in Bitcoin. It’s convenient to be able to sell Bitcoin easily. But it’s not the end goal.
Those of us who spend a lot of time reading the news about Bitcoin know very well that this area is not always honest. In other words, we are being sold propaganda all the time, but deep down we know that not all that is said is true. This is a very common phenomenon in politics and religion. There is the official version, which is full of lies and half-truths. And there is also the real truth that no one dares to tell in public. If you say so, you are a traitor.
We are constantly told that Bitcoin is a safe investment and that the problems lie with the government, the Federal Reserve, and the dollar. And all along it is said that the price of Bitcoin will reach amazing numbers. That is the lesson. But what about the reality?
Here is a hypothetical case. Suppose our dear grandmother asks us for financial advice one fine day. What to do with your pension (what’s the only thing you have)? Option A: We could tell you to put everything in bitcoin. Option B: We could tell you to put the money in a triple-A insured pension fund so you can have a steady income. Now choose between the two options with your hand on your heart. What would you choose
Of course, 75% of cryptocurrency investors fear losing everything they own. And of course 96% of investors also think that cryptocurrencies are more profitable than traditional options. It’s a question of risk and chance. This is not the official rhetoric. But that’s what we Bitcoiners know from the bottom of our hearts. Our bag has to be first and the propaganda later. You need to think like an investor to design the best strategy and get the best results. And sometimes you have to know how to ignore the idealists’ propaganda.
Excellent article. I 100% recommend it. It is important to emphasize the seriousness of the respondents. Several respondents, different answers, same question. What can you expect from Bitcoin at the end of 2020? Latinos to Power! I read word for word on launch day and loved the common sense and prudence of every participant. Healthy and intelligent people. Such an article with guests from the English-speaking crypto community (the “famous influencers”) would have been radically different. It would have been all a show. However, we do not see any unrealistic or visceral predictions here. None of the usual crazy things. Read it calmly. Good to read them all. If I did a general analysis of the article here, that would be my analysis and it is not the idea.
Of course, there are many reasons for optimism. Staying above $ 10,000 for that long is the best news of all. Because time solidifies the supports. For this part, it is important to be optimistic. But one can also say that the Bitcoin market has matured a lot in recent years. The crypto winter helped us to mature a lot. And during that crisis, the market showed incredible strength. Bitcoin is definitely here to stay.
Now for the subject of correlations. There are so many misunderstandings here. If the price of Bitcoin seems to be pulling away from the SP 500 for a few weeks or mimicking gold, it doesn’t mean much. It is not a “decoupling with traditional markets”. If two markets are correlated, it does not mean they are twins. Correlation means that two markets tend to react similarly under certain conditions.
Two restaurants can be affected by a rise in food prices. And in general, this can drive up the prices of the two restaurants. However, this doesn’t always happen on the same day and in the same way. It would be absurd to expect the two restaurants to exactly mirror the other. The problem of correlation is a little more complex than it is sometimes presented.
It’s one thing to be optimistic and another thing to be mistaken. It’s one thing to look forward to ascension and another thing to fall prey to greed, to believe that we will never find a new blanket. Let’s take it easy. Perfect. The PayPal messages helped us a lot. But that doesn’t mean that we will exceed the all-time high in the middle of the pandemic overnight. In moments of euphoria, we need to remember that greed is not a good advisor. We go step by step. Let’s start with the $ 14K first.