Cryptocurrency Analysis

[IFX_Selena]

Nassim Taleb: Don't mess with Bitcoin!



Bitcoin continues to "balance over the abyss". Nassim Taleb, the author of the world bestseller "Black Swan", once again criticized cryptocurrency. According to Taleb, bitcoin is a typical Ponzi scheme. "There is no correlation between inflation and bitcoin," Taleb said. He recommends that investors buy a plot of land or a house as a tool against inflation. "The best strategy for investors is to own those things that can bring income. Do not mess with bitcoin, buy shares of stable corporations and those things that you understand," Taleb said. Thus, Taleb, who does not own cryptocurrencies, as a disinterested expert, believes that bitcoin is a "bubble" that will burst sooner or later. From our perspective, the opinion of a non-interested in the growth of the "cue ball" is more valuable than any investor who already has cryptocurrencies on his balance sheet.

Simultaneously, the CEO of the analytical company CryptoQuant, Ki Young Ju, said that the growth potential for the first cryptocurrency is still very high. He called the recent weeks a "cooling of the market", and the fall in bitcoin prices – a "technical correction". However, the CEO of CryptoQuant believes that "digital gold" will resume the upward trend. As the reasons for the fall of bitcoin, Ki Young Ju does not consider fundamental factors, such as a power outage in Xinjiang County in China or Joe Biden's initiative to raise tax rates in the United States. He believes that the correction occurred due to an excessive number of long positions with too much leverage. Roughly speaking, many traders had an extremely low "margin of safety," and the slightest decrease in the "cue ball" caused a wave of "margin calls" and forced position closures. And, unfortunately for bitcoin, this can be a serious reason for its further growth. After all, bitcoin is an extremely hype investment tool. Many traders, counting on its "constant" growth, really open deals with high leverage, leading to the demolition of stops and margin calls. You should never forget about money management and the risks of the transaction. But, as practice shows, not all investors and traders follow these rules, leading to a collapse in quotes. Although, of course, the influence of fundamental factors cannot be denied. Over the past ten days, the capitalization of the cryptocurrency market has decreased by $ 200 billion.



Let's take a look at the hourly timeframe, which we have already given in recent articles. There is a clear downward trend line here, which shows that the downward trend has already formed and is currently continuing. Quotes have passed over the last 12 -15 hours about $ 3,600 up, but sellers need to keep the "digital gold" below about the level of $ 56,500, which is still far away. Higher up, the bulls can retake the initiative.




Paolo Greco
Analytical expert
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