Once again, the wags are wagging and the wagging is not good. The price of Bitcoin is dropping. That is where most of their “sky is falling cryptocurrency is dead” nervousness is focused. People are running scared because Bitcoin is down 70% from its price peak. As of this writing, it is down to $5,860. That’s the lowest since back in October of 2017.
The last time Bitcoin sunk below $6,000 was October 29. By mid-December, it had rocketed up to $19,982.
So, in a little over 6 months time Bitcoin takes that 70% hit. The result is a sell-off. Investors flee. Crypto Armageddon is here. Run for your digital money lives.
I have to wonder. The same folks who are fleeing and bitching now, were they the ones pumping up Bitcoin with everything they had last year?
As markets go, the plunge of Bitcoin was not a straight line. There were ups and downs along the way. That is to be expected. Markets react to a lot of factors. Good news and bad news. So, you get the movements with the ups and downs that have been graphically represented on countless graphs.
The Crypto Optimists
Not everyone is screaming bloody murder.
There are plenty of optimists in the cryptocurrency space. One of the more controversial is John McAfee. He’s the British-American computer programmer, businessman, and occasional fugitive.
Solidly in crypto’s corner, he has nothing but confidence in the market. Last summer he notoriously predicted that Bitcoin will hit $500,000 by 2020. Claiming in a tweet that if it did not, he would “eat my dick on national television.”
Not long after that, McAfee topped his own prediction. He claimed that Bitcoin would hit $1 million by 2020. He backed that up with another “eat my own dick” statement. That is confidence!
The Virtual Coin Pessimists
Representing the nay-sayers, there is Wolf Richter of Wolf Street. His latest hobby is slamming cryptocurrency. He has been taking potshots at McAfee.
Richter recently started doing the math for McAfee. Richter figured that there are a little over 17 million bitcoins “in circulation” right now. And, doing the math, he placed the market cap at $17 trillion if Bitcoin was at $1 million “right now.
Taking that scenario and running with it, he calculated that we can expect “many more bitcoins” by the end of 2020. Doing more math, he said if that were the case the market cap of Bitcoin would be about the size of the United State Gross Domestic Product.
Continuing his extrapolation, he said that is just Bitcoin. All the other crypto coins need to be included. As Bitcoin booms, so would all the others he surmises. Now, we are up to “half of the global GDP” or something like that according to Richter.
Richter went on to babble about anyone who “believes” in digital currency are “True Believers”. He says the $1 million Bitcoin price is based on “fake hope”. He calls the promotion of a massive Bitcoin price run-up “brainless crap” put out by people who are “either totally nuts or the worst scam artists.”
Then he goes on to compare Bitcoin to “one of the worst fiat currencies the world.” He is talking about the Argentine peso. His “reasoning” is that the world’s favorite crypto coin is worse than the Argentine peso because that peso only dropped 35% during the same time period.
To further back up his opinions he offered that much hedge-fund and family-office money was moved into the cryptocurrency markets last year. Because of the media “frenzy” about it, artificial demand was created. This artificial demand was created for something, he claims, is useless. To further pump it up, he claims that the supply of coins is artificially limited.
According to Richter, this “scam” worked for awhile and now the funds are screwed. The can’t get their money out, he says with causing the price to crash even more.
You can listen to either of these guys or neither. By following the news, expansion of, and growing uses of cryptocurrency, you can better make up your own mind.
As we all know, it is your money you are investing. Make up your own mind, in an educated manner. Then, act accordingly.