May 26th, 2017, 20:30 CET – Since the beginning of May Bitcoin is on an unprecedented bull run which seemingly has no end. Situations simply attract scaremongers who shouts in panic as loud as they can: “Bubble! It’s a bubble! Sell everything!” Well, Bitcoin is not a bubble. I will show you what it is.
Bubble – a definition
A bubble is an economic cycle characterized by rapid escalation of asset prices followed by a contraction with a crash that signify unreturnable end of cycle.
So, basic element of a bubble is that it can’t return in a shape or form that preceeded to contraction and crash. When it bursts, it's gone forever. Volatility of Bitcoin cannot be qualified as a bubble even if we take into account first ‘Silk Road’ price crash, because Bitcoin has recovered and continued it’s rise. All bubbles are more or less, elaborated scams. Bitcoin isn’t a scam. It’s a New World that measures the level of decay of the Old World based on fiat currencies.
In Bitcoin we are actually experiencing normal pattern of rise COMPARED AGAINST FIAT currencies. Remember this: Bitcoin is stable, instable are the fiat currencies that still dominates exchange markets. People are willing to give more and more of this wortless paper for the stable decentralized cryptocurrency, and so the price is rising in fiat. The same would happened with gold if it wasn't controlled and manipulated due to its physical properties.
When, after a longer bull run, a bunch of people sells crypto because of some fears, or some short-term payment in fiat, price fall for a few days, and then starts rising again. It is already seen Standard pattern of Bitcoin rise:
Which can be used for future projections:
Standard pattern of Bitcoin rise
But what if Bitcoin is vulnerable after all?
True, this is quite new technology and anything can happen. I’m not a fanatic. I won’t lie. Bitcoin can fail. Maybe. But fiat currencies WILL CERTAINLY FAIL, and there’s no “maybe” in it. It’s a doom’s device!
There are also two more things you should consider:
Bitcoin grows stronger with every new block. For eight years nobody succeded to destroy it, and we had a variety of attacks of every kind. Hardfork attack is still ongoing, but Bitcoin endures and becomes ever stronger.
Even if Bitcoin by any chance fails, idea is out. It is not possible to kill the idea of decentralized cryptocurrencies, lest of the destruction of planet.
Fiat is already dead. And now, I’m going to show you a picture of it’s demise. But let’s first see Bitcoin’s performance in 2017:
Now, let’s turn that graph upside down…
…and now we can see, clear as a day, global level of trust in fiat currencies. Since the exchange between crypto and fiat goes by a large majority through the five IMF basket of fiat currencies, USD, EUR, GBP, JPY and CNY, this graph shows a GLOBAL FIAT BUBBLE. And it is bursting as we speak. That is not going to rise any more. That’s what you have to sell!
From now on, we are going to measure Bitcoin to the controlled, but closest safe asset in a material world – Gold.
May 26th, 2017. 18:00 CET
Xe.com: BTC to Gold Ounce
1 BTC = 1.88377 oz
Xe.com: BTC to Gold Ounce
1 BTC = 1.88377 oz
