Bitcoin is Dogshit! – SpaceGoatFarts

Let’s now look at market cycles…

Where is bitcoin in the classic market cycle? At point 1 or point 2 in the cycle?

The latest run to $14k was almost certainly smart money playing the markets (and not due to organic growth) by accumulating just above $3k and then sparking the run up by dropping a few $100m to take the price above $4k and start the fomo. Note the lower high, a classic sign of a downtrend. Will $6k hold?…..not without new money coming in?

ETH following the classic market cycle. Will DeFi save it?

LTC following the classic market cycle to it’s inevitable demise.

The ultimate trading contraindicator.

BTC mining under threat?…

Mining of btc is potentially under threat with the low prevailing prices.

2019 has been the worst year for Bitcoin miners in all of the last 5 years.

Mainstream interest is waning…

Google trends for bitcoin. ‘nuff said.

There is no new money entering crypto, there are no new users entering crypto, there is no real mass interest in crypto (compared to 2017/2018), there has been no real development of the tech and there has been no increase of adoption. The primary use case for cryptocurrency is speculation and this use case is dying with the drop in value of all the currencies.

Increasing regulation…

Europe’s and the USA’s opposition and concern around independent currencies including Libra and btc is clear and they will do what they can to maintain their control of the financial system. One method to control alternative currencies is through increased regulation and investors will be brought under control of the very system they are trying to escape and disrupt. Coupled with current and possible actions against Bitfinex, Bitmex and Binance that regulation and control is only going to increase. Bottlepay has already closed down rather than deal with the regulation.

But…but the herd is coming…

As for the argument about all the smart people and institutions entering crypto being bullish, consider the South Sea Bubble and Issac Newton’s record.

What about DEFI?…

The alpha is gone as the interest rates have dropped to the low single digits making it less attractive to the mainstream. The rates may still be higher than many banks but with the falling rates, contract insurance, fiat to crypto conversion rates and the associated friction, they may not be enough to spark mass interest outside of the limited pool of crypto enthusiasts.

What about DEXs?…

They are subject to regulation under US securities law. https://medium.com/@melzhou/how-decentralized-exchanges-are-regulated-part-i-securities-3e999bc52e86

Most cryptocurrencies are securities…

The SEC has only acted against the low hanging fruit so far. The SEC moves slowly but one can be sure it is coming after many more. https://medium.com/@melzhou/when-crypto-is-or-isnt-security-94792a318157

The lines between crypto and the banks are becoming blurred…

Libra and stable coins…

The development of new currencies such as Libra and stable coins will eat into the btc-as-cash use case. Vendors do not generally want to accept a volatile currency and only do it to cater to appeal to a very small demographic and they quickly convert it to their fiat currency of choice. Developments such as the Astro wallet reduce the friction with little cryptocurrency interaction required. With the increased velocity of the cryptocurrencies involved their use as a store of value fades. Fiat wallets such as Apple Pay and Samsung Pay are gaining traction and reducing the appeal of difficult-to-use crypto solutions with their high fees and security issues.

A final word…

It’s over btc… thanks for all the memes.

Published at Fri, 03 Jan 2020 17:59:30 +0000

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Bitcoin is Dogshit! – SpaceGoatFarts

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