The Bitcoin Craze
Monday, 9 January 2017
Why is Bitcoin going through the roof? Some would have you believe it’s solely because of Yuan depreciation risk, with most of the buying coming out of China. This is certainly a factor, and likely chief trigger of the present melt-up, however this is not the entire reason. Others would be quick to add it’s the scarcity factor (only 21 million units in circulation) and the ‘check’ blockchain technology provides. And again, these are factors as well. But there’s another reason. Of all the alternative currency markets, with precious metals the king daddy, Bitcoin is not a controlled market or political target run by Western control mechanisms – centered on futures markets.
Bitcoin has no ‘credible’ futures market or stock exchange derivative alternatives. Therefore, unlike precious metals, speculators who wish to participate in Bitcoin must actually buy Bitcoin, not a derivative used to splinter the market and redirect demand into falsities used to manage prices. This of course illuminates the idiocy of COMEX and its hedge fund / banker players with respect to precious metals.
So how high can Bitcoin go?
It’s a bubble now, and positively correlated with the nexus of fiat based bubbles (stock, debt, etc.) that are sure to pop at some point, so although it can go much higher (for the wrong reasons), it should be pointed out once the Chinese buying dries up, considerable volatility should arrive. What’s more, besides the fact(s) it’s supply is both controlled and monitored, it’s backed by nothing, which in fact makes it a fiat animal as well (because supply constraints can be changed), given it’s much better behaved than sovereign alternatives (don’t tell the public). So, it’s risky – make no mistake. Scarcity, in and of itself, is not sufficient reason to act irrationally in the full measure of time.
Of course there are those that would argue precious metals are a great value right now, and far less risky, however they are controlled; and can’t rise to their full potential(s). And this is true – so let’s hope for change – no?