Baron's Crypto Trading Journal

[Specterx]

So back on the topic, I just want to share this chart so there's a clearer perspective of what's going on. All the naysayers love to bash Bitcoin using a timeframe of the past year, but what about if we go back just a decade or so since inception?

Currently, BTC is in the $20k range. What's fascinating is that the Dow Jones Industrial Average took about 125 years to reach $20k, but bitcoin achieved the same result in 1/10th of the time.

This isn't the right way to look at it. In the first place, the relevant measure is not price per unit (which is arbitrary) but rather dollar market cap. BTC is like a stock which 'IPOed' the first day the founder and his two buddies paid the $50 corp registration fee in their garage. At $370bn after 13 years it's certainly at the upper end of historical observations, but it's not unique. FB/META and TSLA are in the same league in terms of growth velocity, and the MAGA gigacaps have each added far more total market cap dollars per unit time in recent years.

And then, all this is interesting but majestically irrelevant to the future.

 

[Pekelo]

Of course the Dow comparison is silly. If I make a coin and exchange it with my crypto bro for 20K, than we could achieve that price in 1 day. Anyhow, let me do a little history for maybe newcomers.

Price: Influence:

0 to 100 organic, mostly insiders buying

100 to 1000 Willy bot on Mt. Gox

100 to 20K mostly organic, average people learn about crypto, some HFs starts to move in. Also Tether

3K to 66K (Tether's role is still unclear) But mostly everyone and their mother moving in, widespread industrial buying >>> becoming a high beta tech stock and coupling with the Nasdaq

So Bitcoin and cryptos general got the fame for being the first truly worldwide kwonzi. But now that everyone who was interested bought in and the industry also experienced its high and collapse, I don't see just what kind of news or power would push it to new ATH? Usage ain't for sure. It is going to fluctuate, but until it decouples from the market, it is silly to expect 100-300% growth. Occasional good and bad news going to move it out of balance with the market, but 95% of the time it is just a stock following the rest of the market.

 

[NoahA]

Of course the Dow comparison is silly. If I make a coin and exchange it with my crypto bro for 20K, than we could achieve that price in 1 day. Anyhow, let me do a little history for maybe newcomers.

Price: Influence:

0 to 100 organic, mostly insiders buying

100 to 1000 Willy bot on Mt. Gox

100 to 20K mostly organic, average people learn about crypto, some HFs starts to move in. Also Tether

3K to 66K (Tether's role is still unclear) But mostly everyone and their mother moving in, widespread industrial buying >>> becoming a high beta tech stock and coupling with the Nasdaq

So Bitcoin and cryptos general got the fame for being the first truly worldwide kwonzi. But now that everyone who was interested bought in and the industry also experienced its high and collapse, I don't see just what kind of news or power would push it to new ATH? Usage ain't for sure. It is going to fluctuate, but until it decouples from the market, it is silly to expect 100-300% growth. Occasional good and bad news going to move it out of balance with the market, but 95% of the time it is just a stock following the rest of the market.

Just throwing this out there. I've seen several people mention that huge funds can't get into bitcoin yet because the market cap is still too small. They maybe want to be able to move billions in a day.

But lets assume, and this is what I believe, that bitcoin is the single best way to transact. No permission, no counter party risk, enough transparency that the other side can prove they have the asset, no ability to undo the transaction, etc. US treasuries are considered risk free because the US will never default, fine. But when you see how much rehypothecation there is with these things, and the risk of contagion from multiple owners thinking they own the same thing, god knows what happens when real cracks appear. This is why banks stop lending to each other.

So I'm sure enough smart people see the huge benefits of bitcoin, but just can't use it yet for their uses because the market cap is still too small. It therefore seems to me that if the market cap goes up, it will suck in even more interest.

Nobody has to be a bitcoin maximalist like us guys here, but tell me, if all you need to do is make a transaction and you want zero headache, zero risk, and can easily go back to fiat if you want because the liquidity is there, wouldn't this be far superior to everything else out there?

So I really feel like none of these discussions about price and how it got there will matter too much once we reach some critical mass level. Maybe that will be between 500k and 1 million per coin, and then big businesses can easily transact and call it a day.

 

[fullautotrading]

...
But lets assume, and this is what I believe, that bitcoin is the single best way to transact. No permission, no counter party risk, enough transparency ...

https://link.springer.com/article/10.1007/s00181-020-01990-5

 

[Pekelo]

Just throwing this out there. I've seen several people mention that huge funds can't get into bitcoin yet because the market cap is still too small.

It is not a small market cap stock. The market cap is the same as a 200 dollar stock with 2.1 billion shares issued.

If you meant large amount to be transferred, there are other coins for that. Like Doge. And nobody is using BTC for large money transfers anyway. Banks have their own coin for that too. I don't see why HFs would wait for that...And it already happened:

https://cointelegraph.com/news/someone-transferred-a-billion-dollars-in-bitcoin-for-less-than-5

Remember, BTC is for holding not for transferring value.

 

[schizo]

I don't see just what kind of news or power would push it to new ATH? Usage ain't for sure. It is going to fluctuate, but until it decouples from the market, it is silly to expect 100-300% growth.

Is this even possible, that BTC is completely decoupled from the market and reaches a new ATH while the rest of the market is spiraling down? All the markets that trade under the sun, including Forex, which is next of kin to BTC, are correlated. I think BTC should get a new name: WTF.

 

[semperfrosty]

Look, anybody with a first-grade education knows that I'm down on the position. We ALL KNOW THIS.

If a person wants to reiterate over and over again that my position is down, that's fine.

"This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning."

 

[Overnight]

Look, anybody with a first-grade education knows that I'm down on the position. We ALL KNOW THIS.

If a person wants to reiterate over and over again that my position is down, that's fine.

"This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning."

Indeed.

 

[fullautotrading]

....So Bitcoin and cryptos general got the fame for being the first truly worldwide kwonzi. ...

Hello Pekelo. I understand the assonance with "Ponzi" and probably something having to do with "pump and dump" schemes, but could you tell me how this word is formed and the meaning (I am not a native speaker)? Is this a word that every native would understand?

 

[Pekelo]

, but could you tell me how this word is formed and the meaning

Because the cultists, I mean the crypto fans are allergic to the word ponzi, somebody used the word kwonzi (after the infamous South Korean crypto promoter and now on the run fraudster Da Kwon) and we adopted it. There is a slight difference between a ponzi and kwonzi, a kwonzi is a crypto tailored ponzi. Let me see if I can find a definition:

kwonzi: a get-rich-quick, crypto token based pyramid like fraudulent system, where issuers and early investors make profits by selling the otherwise worthless or limited usage tokens to late comers. The system relies on continuously growing number of new investors with cash inflow and can not be sustained in the long run. Once the money inflow into the system stops, the price increase also stops and investors start to cash out in growing numbers, causing the price to collapse.