Those in the Know Stayed Calm: Cryptocurrency Makes Massive Rebound
We live in absolutely unprecedented times.
The media focus on the self-styled social media influencers bathing and relaxing in Dubai who adorned the pages of almost every newspaper in the Western world during the recent lockdowns held themselves out as untouchable celebrities, despite having very little in the way of career credentials.
There was a time when, in order to be influential, a person or entity had to have a long history of progress behind it, and be a benchmark for the subject upon which it is a point of reference.
Not anymore. The young and uber-confident ‘influencers’ have made Instagram and Twitter their own, garnering huge numbers of followers for relatively banal activities such as collecting ‘likes’ in order to win a luxury sportscar, and having enough capital to finance said car via commercial sponsors who know they will get a huge audience.
These days have very quickly become a time at which absolutely anyone can influence absolutely anything, and it is now clear that the cryptocurrency traders and investors who kept calm and quiet during last week’s tremendous flash crash which showed that several popular but unbacked digital assets could fall faster than they rose, and have proven that incredible values of over $60,000 per Bitcoin have been possible just as much as over $600 billion in daily losses could be sustained.
The reason they kept calm is now apparent.
They kept calm because they are a different type of investor or trader. Cryptocurrency advocates approach markets in a completely different manner to any other type of investor or trader. They are ultra-modern, slick and understand not just the modern, tech-orientated world but even more importantly understand the economy of today, an economy that changes every day and is influenced by the man in the street with a bit of tech-savvy bravado.
Unlike any other flash crash, which often results in finger-pointing and government furore, this one, which is the largest in modern history, raised no more than an eyebrow and was brushed off within a few days.
Many crypto traders sat tight and knew it would rise in value again and that is exactly what it has done.
Today, by the afternoon in Europe, Bitcoin had risen to $40,000 per coin. OK, it is not $60,000 but it is an incredible comeback, and it is continuing to rise.
What caused this? The same activity that caused it to fall, that’s what. Elon Musk, who now heralds himself as a market influencer when actually a market creator may be more appropriate, logged onto his account on Twitter once again, this time saying that he has been in talks with Bitcoin miners about renewable energy solutions, as well as news that hedge fund billionaire Ray Dalio has invested in Bitcoin.
It is therefore now a proven scenario that anyone can influence it downwards as long as they know how to bring it back up again using the same platform and similar tactics. Elon Musk very likely knew that the dip would cause the critical thinkers to get into Bitcoin, most of which would be middle class, highly educated people with an analytical mind, but some of which would be bigshots like Ray Dalio.
By causing these massive waves, a whole new audience can be attracted. Very clever indeed.
Even the most conservative analysts remain positive about the future prospects of Bitcoin, with some saying that it is a Bull market and “it is just warming up”.
Cardano and Dogecoin have both rallied by 10 and 25% respectively during the day.
It appears that the clever money is still with Dogecoin, but who says that anyone has to follow the crowd? What we can all learn from the activies on social media and forums this week is that the crowd is you!