Twitter Handle Kevin Sekniqi stated about the current crypto trend, “When talking about 0. Buying momentum stalls. 1. Timely FUD (Elon, ESG, China) + Wyckoff blowoff. 2. Young UTXOs panic, sell. Institutions + whales go net short. 3. Over leveraged longs with collectively oversized OI and positive premia start liquidating, amplifying selloff.”
Conspiracies to entertain: was FUD and selloff coordinated? Maybe, market is unregulated. Likely? Probably not. Just a good alignment of timing.
What does this all mean? We’re likely in crypto perma-bull. Likely in this paradigm we see slower rallies and faster blowoffs.
I became involved in Bitcoin a few months after Satoshi first released the whitepaper. I’ve seen all the cycles. Never have I seen Bitcoin and the broader crypto market brush off relentless FUD like this. The demand is insane. It’s different this time.
You wanted institutions with more sophisticated money. Well, this is what you get. Harder and more sophisticated drops.
Others stated: I think fear for rising interest rates also had a hand in the FUD.
It’s clear that this bull-bear cycle is different from a *structural* perspective. Stablecoin pegs resolve quickly, backwardations reverts fast, funding rates return quickly. What took months or years to resolve before, now does in days.
Kevin Sekniqi stated, How many times has China banned Bitcoin now? I’m losing track. “And I’ll do it again.” “And I’ll ban Bitcoin again.”
Or, hear me out, Bitcoin is on its slow way out, and will be replaced by better tech. Markets are irrational, but not permanently.
Someone was like: BTC up + alts up = healthy BTC down + alts down = healthy BTC down + alts up = super unhealthy.
Also, the sell-off in BTC is coming from young money. In the future, Remember how when your (reluctant) friend bought their very first Bitcoin as it was rising, then panicked and sold at a loss as it was falling? Institutions are going to do the same. With much larger pockets.
Others commenting on China Threat: They could easily play on people assuming their threats are empty because they were usually empty. They’ve been banning crypto since 2015.
Worth Thinking: There’s probably many different systems of modern capitalism that use more energy than Bitcoin. The important question to keep asking is how we can even further reduce the footprint while still achieving transparent, open and Permissionless money. It’s a hard question.
Get the latest Crypto & Blockchain News in your inbox.