Long term I am super bullish on Crypto. As an IT guy I do think that Bitcoin itself is technologically redundant already but with First Mover Advantage and the way Proof of Work operates to secure transactions it’s here to stay for a while yet. No other PoW Crypto can really emerge without facing a 51% attack from the big Bitcoin Miners so we have already hit the point where there is a barrier to entry for new players and Bitcoin can Monopolize PoW to some degree.
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Currently, however, I own zero Bitcoin. I’m not real happy about that because I sold it all to pay for my families new house and the Bitcoin price is already higher than when I sold. I want to be invested and I am feeling the FOMO...especially because it’s started looking like a New Bull Market has begun a bit earlier than I had expected. Even so, I am trying to be patient and get my affairs in order before taking a new position for good reason.
The Hype that accompanies every Crypto Bull Market has been going on for months now and it’s all about the supposedly imminent Bitcoin ETF Approval. Having experienced how sentiment works in Crypto over recent years this suggests to me that it might actually be Overbought. To me the downside risk is two-fold. If the Bitcoin ETF is Denied we will likely see a savage sell off as the hype implodes spectacularly....but if the Bitcoin ETF is Approved we may see a Sell-The-News type of drop because the market widely expects an approval and so the good news might already be Priced In.
Thus I need to quell my FOMO and be content to wait this little Hype Cycle out. If you have any doubts about the impact this announcement can make then have a read of this very amusing piece about the SEC Hacked and Signals Approval of Bitcoin ETF. It once again shows how the market can make big moves on the basis of 1 Tweet. To me this whole situation is a bit of a sideshow, but Mr Market seems to care deeply about having a Bitcoin ETF and you have to respect that the market will respond one way or another as a result of this pending news development.