2020-11-3 13:46 |
Buying Bitcoin during a bull run has been a constant topic of debate among crypto-traders and investors. As market sentiments collide, the result has been evident in these numerous “hot takes,” circulating around the market’s ecosystem, the larger part of the community is evidently keying into the current Bitcoin bull run, that has now propelled the dominant cryptocurrency to new highs of $14,000.
However, the difference in trading and investment market psychology has once again been highlighted by the analyst and investor CryptoWhale. Certain that the bull could crumble at any time, CryptoWhale is weary of investors jumping into the market at this point.
CryptoWhale: Tether Minting is a Big Red FlagPrior to this, news had been circulating that “new money,” has found its way into the Bitcoin ecosystem, suggesting that Bitcoin’s domination in the cryptocurrency market was not solely based on market maturation as was largely suggested. Tether’s ability to “mint fake U.S dollars,” creates a steady channel for the inflow of fiat currencies into the market. According to CryptoWhale, this could be credited to Tether’s staggering market, which swelled by a large margin this year.
“This year, we’ve seen Tethers market cap grow by over 300%, which much of the MC has been funneled into BTC, and other assets to boost the price, and essentially launder money back into real fiat. The reason that isn’t sustainable, and supports my short-term bearish sentiment is the fact that Tether is currently involved in a massive fraud and price manipulation investigation by the U.S.”
Institutional Investors are not the Saviors we think they areInstitutional investors have been ushering their way into the market and the rise of retail investors this year is solid proof of that. This year alone, the market has gained over $400 million in investment from the retail market. Similarly, there was a quick market hype last year that ushered companies like Libra and Bakkt into the market. CryptoWhale now asserts that this hype is merely just an “overactive narrative,” in the market.
”To summarize, this whole narrative on institutional investors rushing to buy up all of Bitcoin’s supply is nothing more than a marketing scheme by big companies such Greyscale, Square and MicroStrategy to grow the price of their stocks.”
Every Market is Booming, Bitcoin is not the exceptionThe policy of purchasing longer-term securities in the open market, so as to increase money supply said to have hit its peak this year, the analyst observes. The vast circulation of the U.S dollar, which is as a result of this monetary policy known as Quantitative easing is already taking place in the United States.
CryptoWhale’s assertion is that there was no coincidence in Bitcoin and the Stock market bottoming at the same time. In fact, the correlation Bitcoin has had with the stock market is precisely a result of the influx of fiat currencies into Bitcoin, which is not entirely as a result of market maturation, but purely the result of “artificial money that has been pushed into them – Bitcoin and the stock market.”
While there is no quick fix to the FOMO, which the analyst claims to have circled the market at this time, he suggests paying less attention to the market movement, making investment decisions void of the “market noise,” and ditching the popular market psychology of buying into the hype when the market is rallying and selling out of fear when there’s a reverse speculated market dump.
“It’s very dangerous to be buying into this hype rally, especially considering there’s a strong (95%) chance that we correct below $10,000 in the near future, and even potentially drop to below March lows – as crazy as that sounds now.”
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