I don’t know whether I have been uncannily prescient at predicting where the cryptocurrency market is going… or if I am causing all of the things I am predicting.
It’s a serious question. It seems that when I say I expect a cryptocurrency to go higher it immediately spikes massively higher right after.
And, yesterday, I said that a pullback in bitcoin and the altcoins was not only to be expected but was a healthy thing after such a massive run-up.
And then, today, bitcoin and the altcoins all pulled back for the first time in weeks.
Only bitcoin and Ethereum Classic avoided the bloodbath… and even bitcoin had a major selloff of its own in the last 12 hours, as it rose to nearly $2,800 and then sold off to below $2,400 before recovering somewhat.
Many are calling this a crash… and it was, bitcoin has crashed all the way back to where it was about 18 hours ago.
This is a much, much needed breather for both bitcoin and the altcoins which I pointed out had begun to become “loco” yesterday.
And this breather gives us an opportunity to respond to critiques and concerns about bitcoin.
The latest came from Mike Adams of www.healthrangerreport.com who put out this video yesterday with the title, “BITCOIN WARNING: When you want out, you won't be able to sell”:
I like a lot of Mike’s health stuff and am speaking at the same conference as him at G. Edward Griffin’s upcoming Red Pill Expo next month in Montana.
Mike is known as the Health Ranger, and dishes out a lot of truth about health… but why he decided to weigh in on bitcoin, which is clearly out of his area of expertise, is beyond me.
In the video, he had three warnings about bitcoin, so let’s go through them.
#1 BIG SELLS CAN CAUSE THE PRICE TO CHANGE
Mike mentions how a drop on the Bitfinex exchange happened when someone sold 2 million dollars worth of bitcoin or 1000 bitcoins and the price dropped $80 per bitcoin on that exchange.
And, uh, yes, this is what happens when people sell large amounts of ANYTHING in a very short amount of time. If you sell a massive amount of US dollars, or Apple stock or, well, just about anything… you will cause the price of it to go down briefly as the market corrects and bids are hit.
Why he is warning people about this in bitcoin is anyone’s guess. My guess is that he should stick to talking about health stuff since he is clearly new to how markets work.
#2 THE BANKS CAN SELL A LOT OF BITCOIN TO DISCREDIT BITCOIN
Here Mike says that if someone sold 10,000 bitcoin at one time the price could tank a few hundred dollars. And he says that central banks could buy up and sit on bitcoin, because they can print unlimited fiat to buy and strategically plan a massive sell-off to discredit bitcoin/cryptocurrency.
And, again, that is what central banks do in EVERY market. They and their Wall Street friends often buy up the stock market and then crash it almost every seven years (Shemitah!). And they do the same with currencies, commodities, real estate and nearly everything else.
So, why make a point of warning people about bitcoin?
Mike is right, the central banks can print up as much money as they want and buy up anything they want. And they could do this with bitcoin. If they do want to do it, however, they haven’t done it yet.
Bitcoin is still only about 1/6th the size of Apple. It’s still tiny. If the central banks wanted to print up hundreds of billions of dollars to buy bitcoin we’d see the price of bitcoin very quickly skyrocket above $20,000/coin.
During that process nearly everyone in the world would be talking about bitcoin, learning about it and trying to buy it… and this would cause the price to go even higher… which would cause even more people to get excited about it.
At that point bitcoin would be so well-known, owned and used by people worldwide, it may already displace the US dollar as the main currency used in the world. And, it’d make thousands of anarcho-capitalists super wealthy.
And if the banks, after doing all that, decided to sell all their bitcoin, all at once, to cause an unprecedented crash, all it would do is give those who missed buying the first time a second chance to buy.
In other words, the banks buying large amounts of bitcoin and selling large amounts would only serve to increase the awareness of bitcoin, make a lot of libertarians incredibly rich, and then offer people a second chance to buy it if they missed it the first time.
#3 TRANSACTIONS ARE BECOMING EXPENSIVE AND SLOW
Mike then points out the blatantly obvious… that bitcoin has already become so popular that it is outgrowing its current infrastructure. Because of that, transaction fees have increased and transaction times have slowed.
This is already known by most and is an issue caused by the popularity of bitcoin but, is also in the process of being fixed.
SUMMARY
So, to summarize, Mike is warning people about bitcoin because it is a market like any other market in which someone can move the price by selling or buying large amounts at once; the central banks can buy and sell large amounts of it just like they do with everything else; and bitcoin is becoming so popular that it needs to upgrade its software to keep up with demand.
Thanks Mike for stating the obvious and trying to make an anthill sound like a mountain of problems for bitcoin. I suggest sticking to the health stuff.
You don’t see me here, at The Dollar Vigilante, warning people about which vitamins they are taking… That’s not my area of expertise. I leave that to guys like you… and perhaps you should leave bitcoin to guys like me.
For anyone who wants to learn about bitcoin and be eligible to receive their first $50 in bitcoin directly from me, check out this free 4-video tutorial here.
Aside from that, I’ll be seeing Mike where we’ll both be speaking at The Red Pill Expo next month.
Maybe I can speak about the importance of amino acids while Mike can talk about how central banking is a scheme set-up to impoverish the masses and we can both waste everyone’s time talking about things we know nothing about.
