I am nothing more than a deckchair economist, I don’t have a whole lot to do with finance these days and I cannot be bothered with even discussing my old job.
These days I would prefer to be in my shed, with my dog by my side, building furniture but, from time to time I look at something and I think to myself “I cannot be the only one seeing this right?”
After years of climbing, the fall began - $25,838.29 into $5,903.69 in 10 months, that is the numbers.
From early 2018 until today, that is the value of Bitcoin in freefall.
To understand why you have to work out what $1.00 is worth and no, it isn’t $1.00 because if it was, there would only be one international currency leaving the notion of Bitcoin redundant.
$1.00 is what the country who prints the money is worth. It is the Oil deposits, the gold in its banks, the minerals in the ground, the businesses and the industries and all the people ready and waiting to make it happen. It is the value of what we need, to live life the way we expect, held in a centralised institution that we entrust.
It is a crypto message, no more than a WhatsApp message, that no one can read and holds no tangible value, with a price dictated by only those who use it and if those who hold it, all decide to sell because they no longer trust it, it becomes the same as a mining company with no gold. Worthless.
Bitcoin has been on a downward trend for months now because it holds no real value. There is no county called “Bit-topia” mass producing oil, silver and gold, so there is nothing tangible others want to back against it. There is no central bank issuing bonds in its name.
To better explain it, imagine sending a text message to your best friend but, for them to receive that message, your cousin had to verify that it came from you. That is all bitcoin is, except in this instance, you don’t know either your best friend or your cousin.
I am not denying that Cryptocurrency has a future, but the hype this one started, created an unbelievable precedent that will force future, better-implemented Cryptocurrencies into a corner resulting in nothing like the 2018 spike in value, it will open a market where “$1.00 is $1.00″ no matter where you are.
As for Bitcoin, if you know trading or at least know what charts to look at and you want to talk “market speak” it is just the biggest “cup with handle” (Bull market) into an “inverted cup with handle” (Bear market) in history.
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