CZ is still out here playing 4D chess.
- First he bank-runs FTX with a Tweet.
- Then he says all exchanges should prove their reserves.
- Then he calls out all the exchanges that proved their reserves in shady ways.
- crypto.com, huobi, gate.io, and many more all under scrutiny.
- All of this pushes more volume to Binance.
- Now CZ is creating an "industry recovery fund"
- Already 5 sources have been baited into applying 'anonymously'.
- Now CZ has even more insider information.
The bank-run against crypto.com continues.
If they don't go insolvent that will be a pretty good sign that perhaps the fallout from FTX won't be that bad. However, it is quite clear that the dust on the FTX fallout has not settled, and it may not even be settling. The contagion of 3AC going under lead to the collapse of TERRA LUNA. Many expect the contagion of FTX to lead to a similarly devastating event.
Personally I'm not super convinced this will happen. Everyone and their mother is calling for $10k Bitcoin. Really? $10k? The FTX collapse was less than a 20% dip, and we expect the fallout from FTX is going to be... a 40% dip? Yeah, that's not real. The bears are still drawing straight linear lines to measure support at a rock-bottom level that has support everywhere. Again, a full 80% retrace on Bitcoin brings us to $14k. That's a much more reasonable level to target if bearish.
The market is very confused right now.
Everyone can see how bad it looks but at the same time maximalists are celebrating their "victory".
I mean it was always obvious that maximalists were delusional hypocrites, and the current timeline we find ourselves in is no different. Maximalists provide zero infrastructure to avoid custodians, and then blame everyone else for the problems they aren't fixing. More often than not they'll simply say "oh the lightning network fixes that" to any given issue. Yeah, it doesn't though.
Regardless of the hypocrisy, it is now more obvious than ever that we should be acquiring as much Bitcoin as possible. I've been saying this for months, and it only gets more accurate over time given these constant debacles.
2023 has a very good chance of being the year of the maximalist. I made that prediction in July 2021, and I still think it's pretty valid (even though the price predictions were incorrect). Regulators are going to have a field day with crypto after everything that just happened. 3AC gives them an excuse to regulate hedge funds and whatnot. LUNA gives them an excuse to regulate stable coins. FTX Gives them an excuse to regulate the banks. If we look at the evidence that connects all three of these collapses, it almost appears like a coordinated attack to allow these regulations to sail in with zero resistance (tinfoil hat required @klye). These events are weirdly connected.
So in 2023 the regulators are going to be swinging their dicks around at everything. Combined with historical patterns, it makes a lot of sense that 2023 would be a bull market for Bitcoin (maybe goes x2 or x3) while the rest of the alts just sadly trade sideways (or worse). 2023 may very well be a good time to allow Bitcoin to dominate the market so we can sell it back into alts at a huge discount down the road (just like Hive in 2020). I'm personally stacking as many sats as I possibly can without blowing my other bags up.
This is an especially good strategy seeing as where we are right now. Something like Hive can easily fall to something like 1500 sats per coin or below. Our market does not have a lot of volume or liquidity. Price moves up and down very haphazardly, and often on a whim from Upbit. Meanwhile, Bitcoin continues to consolidate and get exponentially more buying pressure as max pain moves in.
But they didn't even sell any BTC...
- That's the funny thing about the FTX crash.
- The 3AC crash liquidated tons of Bitcoin.
- LUNA insolvency liquidated tons of Bitcoin.
- FTX liquidated ZERO Bitcoin.
Why did they liquidate zero Bitcoin? Because they didn't have any. FTX was selling every last drop of Bitcoin the second users deposited it on the network. When they went insolvent, the only reason BTC crashed is because speculators crashed it. This is a dynamic that should give us pause, as even though the fallout of FTX is still playing out... BTC is grossly oversold just because people are afraid. That's the only reason.
Conclusion
I'm convinced more than ever that $10k can never happen, especially now that everyone is calling for it. People are acting as if the history of Bitcoin 'proves' it. "Well, Bitcoin usually retraces 85%". LoL, yeah... it retraces 85% TO A HIGHER level. from $100 to $1000 to $200. From $1000 to $20000 to $3000. And now they are all saying from $10000 to $69000 to $10000. What? No, that's never happened. $20k was supposed to be the support. Paper hands are being fleeced.
Again, I implore everyone to not make any hasty decisions until we've had a full two weeks to refactor where we are at. 9 days to go on that front. Will be interesting to see where this rabbit hole leads. Are we at rock bottom, or should we be bracing for $14k? $10k is not happening. Literally every single person wants to buy there.
All exchanges except Binance have done a poor job of proving their reserves. Coinbase, Kraken, and Gemini are also relatively safe because they are heavily regulated and based in USA. I knew there was a reason why I wasn't touching these new exchanges with a ten foot pole. Feels nice to not be on the cutting edge for once. Sometimes the edge falls off into the ocean. Stay safe out there.