The bitcoin summer is here with the currency up $1,000 to now $10,900 at the time of writing.
In a night that few will forget, bitcoin went through $10,000 while Europe was probably mostly Friday drunk, America was about to get drunk, while Asia was just waking up so giving the other two a sober driver.
Upon taking $10,000, some bears tried to kick it back under the line, but bitcoin stood, with eyes so turning to eth.
Little brother was struggling, all moody and annoyed that bitcoin up and up while itself facing formidable resistance at $300.
So bitcoin rose again to $10,600 and took eth’s bears down. $300 fell to much joy in a land that has gone through so much in the past 18 months.
And so they both rise on summer solstice with heads now probably turning. Is bitcoin to roar again?
Looking at the daily candles with perhaps a magnifying glass, it does look like there is no resistance until $17,000.
That was last time. Whether it’s still the same this time remains to be seen, but arguably so far this rise has been due to smart money.
While understandably taking $300 and $10,000 was much reason for joy, many feel nothing.
More relief perhaps, with maybe some hope. While for bears, they may have entered fear with it remaining to be seen whether capitulation for them will follow.
What most want to know is whether this will now make a big U shape, which it would if it goes back to $20,000.
Zoomed out, the $1,000 high in 2014 and then again in 2016 made such U shape, with bitcoin then going on to rise further.
The Summer of Hope
At all time high, bitcoin’s market cap would only be about $350 billion. While just one company, Apple, has a market cap of a trillion.
There are now three companies with a market cap of about one trillion, as there are three men that are now worth $100 billion each. Both of those being a first.
That’s inflation for you, and 2% a year might not seem much but it has a compounding effect.
That’s if you’re lucky to live in a country that has a 2% inflation rate. In Argentina and Iran, for example, it’s at 50% a year. In Venezuela, they no longer have fiat money, so decimating all savings, all pensions, all wealth except assets like bitcoin.
It’s a tragedy that keeps repeating because fiat money is basically soviet money. The politburo, called the FED or ECB or really the Bank for International Settlement (BIS) where all central bankers coordinate, so decides every few months whether to devalue money or to make commercial banks richer by increasing “consumer’s” debt burden through increasing interest rates.
This system does not work and can not work for like the Politburo doesn’t know how to set the price of bread, so too it doesn’t know the price of money.
Hence bitcoin, which at this stage is sort of a savings account with some extra qualities like no terms and conditions, you can actually move it, there’s no bank to just not give you your money, and so on.
Since money keeps being devalued, in literally every single country at various rates, then even if there are no new users you’d think the value of bitcoin should increase because the value of other money keeps falling.
Information however does travel very slowly and as a very new thing, wrapping your head around bitcoin isn’t easy.
Even in Europe and even in London many ordinary people down the street do not have much of a clue of what bitcoin is.
So awareness keeps spreading, but just 13% of Brits own a bitcoin. That means the tipping point has been reached, but adoption has barely entered the institutional phase and that’s for America, let alone much of the rest.
Meaning this rise was probably due to smart money across the globe who have probably been accumulating this very rare asset.