Issue 139: Bitcoin and Basketball
June 17, 2021
Bitbuy Partners With CEBL To Pay Players In BTC
Weekly Market Update
Opinion: The State Of The Crypto Market
After reaching a new all-time high, bitcoin fell nearly 41%. With these frightening prices, many have begun to ask, is the crypto bull run over?
Let’s consider some conditions around the recent downturn. One of the most notable was driven by Tesla founder Elon Musk. After purchasing USD 1.5 billion in bitcoin and announcing that Tesla would accept bitcoin in exchange for its electric vehicles, a single tweet derailed the momentum. In his tweet, approximately a month and a half later, Elon Musk announced Tesla would no longer accept the digital currency. It was around the same time that China announced that payment organizations would be blocked from accepting bitcoin.
This came recently after many “brand new to crypto” new investors began purchasing bitcoin. According to one research group, this same group of investors that purchased in the last five months also made up most sellers, dropping the latest fear and greed index into “Extreme Fear.” This should come as no surprise as investing 101 often states, new investors must exercise caution against emotionally driven investments.
Weighing all of these factors, many industry analysts are still predicting a 6-digit bitcoin valuation in the medium term.
The main difference between this pullback and others is that previous bubbles were driven by cryptocurrency enthusiasts and retail investors. With the most recent wave of adoption, investment firms and tech companies also bought in and have since taken the hit.
A broader group of investors means that more stabilizing forces are at play. Although prices have been hovering at a significantly lower price, many savvy investors have been waiting for this dip to occur. New lower prices have made it possible for enthusiastic investors to continue to buy into crypto assets and for large investment funds to continue to diversify.
While it’s hard to say if the crypto bull run is over, another tweet from Musk and as of June 14, 2021 another 10.9% run was imminent, driving bitcoin to the highest price since May 18. I guess it’s true what they say, it’s not over until it’s over.