A brief review of the week’s most outstanding kryptonews so that you don’t miss any details about what is happening in the world about bitcoin, blockchain and the crypto ecosystem.
After a catastrophic election debate, we have the cherry on top. The president of the United States, , and his wife Melania have been diagnosed with . That ironic reversal of the political plot negatively affected the markets and . Bitcoin, against all odds, remains aligned with the S&P 500.
I must confess that I’ve always considered Bitcoin to be a growth asset and not a „safe haven“. Which means that a crisis isn’t good for Bitcoin. Prosperity is good for us, not disaster. If the ship sinks, we sink with the ship.
Now, let’s talk about the most read Kryptonews of the week.
It’s no secret to anyone that they are subordinate to the . The government’s power over the banking system in general is very great. With the help of the banks, the government can easily obtain our financial information. And it can collect taxes without our consent. You could say that, from a financial point of view, we are at the mercy of the Government because of our dependence on the banks.
Of course, it is always possible to avoid using banks. It is possible to use cash or to use . We can also move our money to banks in more liberal jurisdictions. All of this is possible. And, in fact, it’s done a lot. The fear of the government freezing our funds (a playpen) is a legitimate concern.
The most sensible thing would be to have only the strictly necessary amount in the bank. Personally, I only keep the money I need for my weekly expenses in my bank. It is possible to protect yourself. However, for many, banks are a necessary evil. Many businesses must comply with the law on tax matters, for example. The use of banks is necessary to receive payments, to pay suppliers, and to obtain credit. In these cases, there is no escape.
Well, many factors indicate that a bullish period is just around the corner. Bitcoin won’t stay at this level forever. The price will eventually rise, due to future demand.
The problem is determining when. There will be fluctuations. That’s for sure. Can Bitcoin go up? Yes. Can Bitcoin go down? Yes. Obviously, we have factors in favor of a rise. But we also have elements in favor of a decline. In the short term, anything can happen.
How will Bitcoin react to a shortage of liquidity? How will Bitcoin react to a drop in the S&P 500? How will Bitcoin react during the election and transition period? The situation at the moment is so complex that predicting a direction now is certainly an extremely reckless act. Sometimes we forget that investors are real people. And the human aspect is very relevant in these cases. It’s not all about numbers. We are in the midst of a global economic crisis, a pandemic, international tensions everywhere, and political crises in most countries. We cannot even predict how we will spend Christmas. But do we already know the future of the price in the coming weeks? Good luck with that.
Scarcity is important, only if there is demand. Much is said about the Bitcoin code and supply shortages, but without demand, there’s no value. That’s easily demonstrated. Let’s say a group of people fork Bitcoin and reduce the supply. Then, we have the same wonder code and more scarcity. We could call this new crypto „SuperBitcoin“. In theory, this crypto should soon be more valuable than Bitcoin. However, in all probability, this will not happen.
The answer is demand.
Bitcoin isn’t just your code and its scarcity. Bitcoin is also a history, a culture, an infrastructure and a community. The code can be updated. And the supply can be changed. But the web is not an easy thing to get. On the demand side, the good news is that institutional capital is slowly coming in. Bitcoin is entering the big leagues. This will be traumatic for many. In time, many idealistic bitcoiners will say that the Bitcoin community betrayed its anti-system origins. In this sense, we’ll have a culture clash between traditional investors and ideological bitcoiners. But I dare say that the price hikes will be a comfort to the most critical.