2021W20 - WTF has happened in bitcoin this week?
Bitcoin is here to stay
TLDR: Bitcoin price continues plunges, short term holders sell at a loss, long term holders accumulate, there is fear in the market, bitcoin continues being a net positive for humanity.
Hey there niblings, it’s uncle Bam again, with a summary of the most insightful events in the Bitcoin space. Back at it again digesting all the important news for you.
This has been an eventful week, to say the least. And here comes uncle Bam again with his main purpose, my core help you build conviction, and remind you that Bitcoin is here to stay.
So what happened? We have been trending down in price after in a strongly manner. Just in the last two weeks the price has plunge from ~$60,000, to a low price of ~$30,000 in a matter of weeks, this is 50% in just under 14 days. Now I wouldn’t dare to attribute causality to any of the reasons, but let me share my opinion here:
Elon started tweeting about the environmental impact of Bitcoin and the decision of Tesla to stop receiving bitcoin as payment.
After taking a hit, news circulated that China is banning bitcoin.
(This has happened over and over again, i.e 2017)The market was too greedy and people were overexposed to derivatives. As the price started to plunge due to fear, liquidations started in form of a cascade.
There have been many big/wealthy new players in the last couple of months, and some of these panicked and started selling at a loss.
Nevertheless, long-term ‘hodlers’ and miners (whether big or small) kept on accumulating, which helps the network to, create a price bottom and distribute bitcoin in the hands of more players
Let us see this in two charts shared by @dilutionproof
All while bitcoin becomes more distributed.. (shared by William)
So as we normally do in WTFBitcoin, let us focus in the positives. The price is only a reflection of the actual sentiment of the market, and just indicates that there is information asymmetry and the environment has been led by emotions. Fundamentally the development keeps on going in all fronts, and good news keep coming every single week, it is just a matter of distinguishing the signal from the noise.
And this is how the week started.
0. MicroStrategy has purchased an additional 229 bitcoins for $10.0 million in cash at an average price of ~$43,663 per bitcoin. As of 5/18/2021, The company owns ~92,079 bitcoins acquired for ~$2.251 billion at an average price of ~24,450 per bitcoin.
Michael announced that the entities under his control have accumulated a total of 111,000 bitcoins, and have not sold a single one.
1. Sony has filed a patent for a platform that would allow users to bet on esports using Bitcoin. The patent suggests a system where viewers of livestream E-sports would be able to bet on the outcome of matches while watching the action play out in real time.
2. Digihost Technology Inc. reports that over 90% of the energy consumed by the Company in its Bitcoin mining operations is from sources that create zero carbon emissions and more than 50% of the energy consumed by the Company is generated from renewable resources.
3. People start to get worried about inflation.
(Relevant because bitcoin is hard money as it can not be artificially inflated)
4. Legacy Records is the first record label to offer their artists to be paid in bitcoin.
Keishia McLeod, CEO of Legacy Records, said it came down to “either get involved or get left behind”. McLeod cited unique income stream opportunities for artists and closed by saying that “this is the future, not a trend”.
5. Scopus Asset Management has almost doubled its Bitcoin exposure through Grayscale Bitcoin Trust (GBTC) From 173K to 321K GBTC shares.
6. Top 10 Chess elite players compete for bitcoin in strongest online tournament yet. Both Magnus Carlsen and Ian Nepomniachtchi are taking part ahead of their €2 million, 14-game world title match in Dubai in November-December.
7. Cathie Woods, CEO of Ark Investment, makes an appearance in bloomberg, sharing their opinion in the bitcoin’s price target. She reiterates that it remains unchanged, and they see it reaching levels of $500,000. That now it may be a capitulation phase, and a great time to buy.
8. The University of Pennsylvania just received an anonymous gift of $5 million worth of Bitcoin, with the help of NYDIG. This is the largest cryptocurrency gift the University has ever received.
9. DMG Blockchain is adding a solar installation for their Bitcoin mining,
"We’re pushing into renewable because it’s just logical and natural for us to go that way.. It’s natural and logical for me to put a solar plant up because that would give me the lowest-cost power.”
10. Nebraska passed a regulation to allow bitcoin centric-banks, just as it has been done previously in Wyoming. The state is inviting people passionate in the space to build together.
11. The largest Domino’s Pizza franchisee in the Netherlands has offered to pay its employees in Bitcoin. With over 16 location, Immensus Holdings has 1,000 employees, all now eligible to get paid in Bitcoin.
As a summary note..
The space continues to grow, and even with the “Bitcoin uses too much energy narrative”, the narrative continues to be debunked by both the incentive of bitcoin on moving into cheaper energy sources, with zero carbon emission, and due to its continuity of being a net positive for the world, allowing people without the financial opportunities that some of us may have in developed nations, to be integrated in an honest and fair monetary network, which is bitcoin. You don’t have to believe me, you could see it for yourself, one beautiful example is the current situation in El Salvador, where bitcoin is being used on a daily basis.
All in all, if you are experiencing pain regarding your position, maybe you are over exposed, just keep in mind the long term play. Don’t get carried away by the bull market, bitcoin is about saving money for your future self, not about making a quick buck. If you are looking for a quick gain, then this might be the wrong place.
No one knows whether the price will go up or down in the short term. But YOU know that it will see higher prices in the long term, it is inevitable.
Bitcoin is a marathon, not a sprint.
Hence the great saying.. Stay humble & stack sats.
Have a great weekend niblings.
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Reference:
0.
1.https://patentscope.wipo.int/search/en/detail.jsf?docId=US323753843&tab=PCTDESCRIPTION
2. https://www.globenewswire.com/news-release/2021/05/17/2230611/0/en/Digihost-Reports-on-Green-Energy-Consumption.html
3.
4.https://bitcoinist.com/the-first-record-label-paying-music-artists-in-crypto/
5. https://t.co/yqUtPQp2ak?amp=1
6. https://www.ft.com/content/50997463-ff03-47f9-8c8e-0ddf82873e3a
7.Link in thread
8.https://news.wharton.upenn.edu/press-releases/2021/05/university-of-pennsylvania-receives-largest-cryptocurrency-gift-in-the-universitys-history-to-support-innovation-in-finance-at-the-wharton-school/
9.
Link in Thread
https://www.coindesk.com/staff-at-biggest-dominos-pizza-franchise-in-holland-can-now-be-paid-in-bitcoin