Bitcoin Pump Waves

in LeoFinancelast month

It's interesting to look at the all-time BTC chart. If we watch the chart on the log scale (as opposed to the linear scale), we can notice that the current BTC pump is at least the 4th (or even the 5th) big pump in BTC history.

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I don't know what caused the pumps in 2010, 2011 or 2013, because I didn't follow BTC at that time. Some say it was because of halvings, or maybe it was due to BTC adoption in the Darknet, or better trading infrastructure, some trigger inside the then small crypto community. Anyway, at that time Bitcoin was cheap and it was relatively easy to drive it, say, from $1 to $25 or even from $100 to $1000 apiece.

But the pump of 2017 was definitely the result of the "retail FOMO". In early 2017 BTC made a new ATH above the nice figure of US$1000. Matured shitcoins and CUDA/OpenCL-enabled mining algos made GPU mining available (and profitable) again. The miners rushed to buy GPUs and created shortages and inflated prices which gradually draw the public attention. At last, casual people learned about the magical internet money priced at $1000 apiece, watched the price growing every day, a hype media tsunami went on, the casuals bought themselves all in -- and got rekt.

By 2020 most of those who got rekt in 2017 have already learned that they'd be much better financially if they steer clear of speculating a shit when they know anything neither about the shit nor about speculation. In 2020 even experienced speculators were not sure about the pump. Myself sold my BTC stack at about $13K and had to rebuy it later at a higher price (the fact that doubts my trading experience, unfortunately). Another trader guy I'm watching was not sure about the pump for weeks, until the price went from $10K to almost $20K. Yet another trader guy was trying to short BTC at $18K. What I mean is that this time it was hardly any "retail FOMO" that fueled the pump.

The crypto folk has already coined the term "institutional FOMO". It sounds cool indeed, but I doubt it's the case at the moment. So far we have only like about two "institutional" buyers who're definitely not FOMO-ing, even if they keep buying BTC at $30K. The real FOMO is yet to come if those big guys succeed in luring other big guys to buy into crypto.

If they succeed, the pump of 2021 will be huge, in absolute figures (albeit probably much smaller logarighmically, than the pumps of 2011 or 2013). At the moment I don't discuss why those big guys would want to go into crypto (if they would at all), but if they would -- they would go in with millions or even hundreds of millions of US dollars. And if they do, it will be very interesting to see why they do it (and whether those "smart money" get rekt just like "dumb retail" at the end of the day).

But the main feature of the possible 2021 pump is that if it does happen it will probably be the last big crypto pump (or at least the last big BTC pump).

Really, after the "institutions" who next will be able to drive the price another 2x, say, from $100K to $200K and even more from $249K to $498K? Dumb retail or the governments? And why? Here again we return to the question of Bitcoin myth.

In the end I'd like to notice that a newly expected pump is a matter of weeks or even months. If you're going to buy $100M of crypto, you just can't take your credit card out and simply buy it the next minute through some "Buy BTC online now!" shitservice. At least, you have to wait for your wife to approve the deal.

Posted Using LeoFinance Beta