After a pretty huge drop in crypto at the beginning of 2018 following the ridiculous highs at the end of 2017, we’ve had a year of relative stability in the crypto markets, and then November happened. What happened in November? It’s hard to pinpoint a single reason, but pretty much every cryptocurrency has absolutely tanked, with Bitcoin in territory that it hasn’t seen in well over a year. Before I make the case for Bitcoin reaching $1 trillion next year, let’s see how we got here.
First though, fiat stock markets have had some pretty big dips, arguably it is largely related to tech stocks and the house of cards many of them are built on financially, but also the mounting bad press about their abuse of the data they collect and the voices they silence. At about the same time, there was a Bitcoin Cash fork war going on and it is hard to ignore the timing between that pissing contest and everything starting to drop. Of course, tweets like this one from Craig Wright certainly didn’t help. I think it exposed the delicate nature of the perceived values of these cryptocurrencies, very few of which are actually used for much of anything beyond speculative trading.
Craig Write tweet about tanking Bitcoin
According to Bloomberg, the U.S. Justice Department is looking into price manipulation from Tether in a complex scheme that included crypto exchange Bitfinex. Not surprisingly, Tether refutes these allegations, but to date, there really hasn’t been a reputable audit of the funds that Tether claims to hold. Then you have the Mt. Gox “Whale” trustee who does a big Bitcoin dump periodically, which then sends the price down. The trustee claims won’t sell anymore, but who the heck knows.
In the meantime, I’m lurking around in various crypto Facebook groups and following them on Twitter and you see all the HODL and FOMO people, and they are all making predictions about the bottom, what it will be, when it will get there and then what it will hit next week, next year, etc. My favorite might be John McAfee saying that he will eat his penis if it doesn’t hit $1 million in 2020, up from originally saying $500,000, so that is some real confidence, but it isn’t something I want to see again after the trauma of the 1987 film “The Cook, the Thief, His Wife & Her Lover”. Thing is, none of these people have inside information, they are all just guessing, and there is a lot of inside machinations going on that most people are unaware of. When Craig Wright can single-handedly (it seems) cause a huge drop in Bitcoin, that’s damn scary, and he’s just one player.
So, what is my case for $1 trillion Bitcoin in 2019? Nothing. I just claim it will be, and that claim is as valid as any other argument you’ve seen for any other price at any point in time. This story wasn’t a total waste of time though, look at everything you learned about what is going on with the prices. You now know more than most people making predictions.