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Bubble, Bubble, Froth & Frenzy
"To wake [up] and see Bitcoin down 15% at one point overnight was certainly reflective of [a] 'speculative overshoot' feel which has more people flagging a pending correction," Nomura's Charlie McElligott said Monday.
Bitcoin of course hit $34,000 over the holiday weekend, pushing the "digital gold"/real gold ratio to a record high (figure below) in the process.
For whatever reason, it (Bitcoin) decided to plunge 17% out of the clear blue sky (and that figure of speech serves a dual purpose he
15% drop over the weekend for no discernible reason does not boost confidence. Profit taking soon to follow?
Who knows? Who cares? Casino dwellers.
yeah, and I mean, it could be at $50,000 next week for all anyone knows.
what seems silly (to me anyway) is when you see on social media and message boards the crypto crowd trying to find historical examples of currency volatility or currency crashes to make the argument that Bitcoin isn’t really “different”
one can always find a historical example of something if one tries hard enough.
so, my point isn’t that it’s “impossible” for a developed market currency to abruptly collapse 15% and I’m certainly not suggesting that all fiat currencies aren’t inherently worthless — they clearly are. Money is just a made-up human construct after all
but all belabored attempts on the part of Bitcoin adherents to argue the case aside, the fact is that if, for example, the pound or the yen or the euro were to collapse 15% overnight, it would be huge news. with Bitcoin, it’s just “another day at the office.”
and that, right there, is what’s so concerning for something that’s variously billed as a store of value, a safe haven, a medium of exchange, etc.
in reality, it’s a penny stock where one share is “worth” more than a loaded Honda Accord.
I’m just a mere speculator, but I’ve heard adherants argue that bitcoin ‘should’ become more stable in the future and that today’s value is derived from a future usefulness that just isn’t quite there yet. Which does seem like a big leap of faith, although I suppose this is how some stocks function (looking at you, TSLA).
Given the backdrop of Tuesday’s Georgia runoff elections, Wednesday’s scheduled political theater, and the subsequent two weeks of chaos during which Trump may literally try anything and everything to stay in power, I would be surprised if Bitcoin didn’t hit new highs.