The total crypto market cap has gone up
rocketing it up from $140B
to $170B but a lot of
people out there are still skeptical.
they say the market is manipulated.
it’s gonna crash, that it’s a dead can
other people look at those people and
say “look! people are wary!” people out
there are still unfamiliar with market
cycles and disbelief is a key part in a
market cycle. So how can you benefit from other’s skepticism? let’s talk about it
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great to have a discussion there it’s
always respectful. so people are wary
here are some comments I’ve seen on
Twitter recently “Bitcoin was manipulated
to $20,000 and heisted back down to
$3500 in 18 months
congratulations for bouncing back to
$5,000! hahaha there are lesser fools
everywhere” and another one “well this
thread is the example of fools who have
invested and still expecting big return
for a TOY money” and another one: “dead cat bounce!”
that’s all it says. Few months ago
I was in hostel I met a Bolivian fellow
and I told him I had this channel
talking about cryptocurrency and he said
“oh yeah Bitcoin… si… isn’t it a pyramid
scheme?” then I met a young lady from
South Korea and she said to me “ah yes
Bitcoin isn’t it a fake?” so people out
there are skeptical. people are wary and actually I like it when
people are wary. I’d much prefer them to
be wary than to be climbing over each
other, climbing over each other’s own
grandmothers to try to get some Bitcoin
because that’s when you know that the
market is overheated and people are just
worked up into a frenzy – irrational
exuberance. There’s a really important
phrase if you haven’t memorized this
yet you need to repeat it over and over
It’s this: “be greedy when others are
fearful and be fearful when others are greedy.”
Think back if you can remember
all the way to the first quarter of 2018
a lot of people, when a little rally in
Bitcoin started, they jumped on social
media and they said “is this it? is it back?
is this the return of the Bitcoin cyberchrist?”
and of course it wasn’t. The rally
quickly fizzled out and drooped down
looking pretty sad like a sad panda
“and when one little panda puts his furry
little Willy in another pandas ear, that
makes me a very sad panda.
eventually those
people stopped posting. a lot of the
Facebook crypto groups that I’m in got
really quiet like dead, like tumbleweed.
then and the blast quarter of 2018
people started posting again some of
these people apparently just stuck
around in these crypto groups and still
stick around, just to let everybody know
how little they believe in
cryptocurrency. Now with this recent
rally it seems to be stepping up a notch
as more people out there saying that
this rally is false, it’s nonsense,
it’s not gonna be sustained. So this is
funny the previous rallies had that hype
around them they had the hope around
them but they didn’t last. now bitcoin is
rallying and people are skeptical and
that tells me that there’s more pushing
this rally than just hype and hope it’s
probably something more substantial,
underneath the surface. There’s another
phrase which is really important in
markets and it’s kind of a joke among
people who have been in markets for a long time. The phrase is
“it’s different this time” and when people
say that you need to start looking at
your portfolio and wondering if you’re
overexposed to the market, wondering if
the market is overbought because “it’s
different this time” that’s something
people say when they believe that the
market is just gonna keep going up
forever. Part of the reason this phrase
is so insidious is because it’s kind of
true. Every time it is a little different,
every time there is something a bit new
but it’s not different in the way people
think. so there are things that stay the
same and there are things that change
every time. let’s talk about a couple of
those things which in some ways are
constant in some ways of changing. let’s
talk about access to cryptocurrency, and
let’s talk about the Halvening.
when I first bought Bitcoin I had to go on to
PayPal, deposit some Australian dollars
convert them to US Dollars, send them to
Virex and convert the dollars
to Linden dollars, the currency of second
life, and then finally buy Bitcoin and in
the process I spent about 20% on
Commissions. the next time I bought
Bitcoin I remember I deposited onto
Skrill they probably charge me like 2.5%
just for the deposit and then I
paid the trading fees as well
Eventually I could just walk into the
National Australia Bank and hand them
some hundred dollars in cash and
deposited straight into my Coinjar
account, and the past couple of years
people have been able to go on a site
like Coinmama and just buy straight
with their credit card then there are
decentralized exchanges such as Bisq
so you can download the program and
trade with people in your country even
if cryptocurrency is illegal in that
country so we’re likely to see this
trend continue it used to be the hugest
bottleneck, trying to get into the
cryptocurrency market, you just couldn’t
find a way to put your money inside. but now there are more and more
ways for people to do that and that
means the next time the cycle rolls
around more and more people are probably
going to be putting money in, either as
speculators or people who find a
practical use for it.
Now the Halvening
if you don’t know, the Halvening is when
Bitcoin halves its rewards for the miners
every four years the first time it
happened people weren’t really
anticipating it and weren’t thinking too
much in terms of supply and demand so
they didn’t think to put in money before
the Halvening and take advantage so the
price just rocketed up pretty soon after
the Halvening. the second time it
happened people were a bit more savvy
they saw what was going to happen with
the supply and the demand and they
realized about three to six months
before and started buying so the price
went up a bit. But it’s hard to take account
how much those rewards affect the
market when miners are selling millions of dollars
worth of Bitcoin every day and people
have to keep buying in. So what happened
three to six months after the Halvening, the price started going up once
again and that’s when the media starts
getting involved and that’s when they
start to pile on and especially when it
reaches an all-time high, that’s when the
media goes berserk. So the upshot is this
all those people who were skeptical out
there they say well bitcoin doesn’t have
a future or it’s just not ready or this
kind of thing this is all part of the
cycle. So I can’t say for sure what’s
gonna happen in the next six months or
anything like that. I do know that the
Halvening is likely to happen on May 23rd
2020 so about six months before that
time we’re likely to see a lot of money
go into the cryptocurrency market. Cycles
come cycles go, you can look at the
charts where people have plotted out the
attitudes of people at different points
in the cycle and you can see disbelief
is a key one and it
says, on one of these charts it says
“this is a sucker’s rally” and that’s
exactly the kind of comments that I’ve
been seeing in social media. So take that
into account
Just some final thoughts I want to tell
you my long-term prediction of what this
stuff means for humanity because I think
this technology is actually gonna offer
something more. Once again I wanna add on to “the dream of cryptocurrency” the
highest ideal. I bought into Bitcoin a
couple of times when it was bubbling and
after the second time I started to see,
I started to realize “actually if I want
to be smart what I need to do is buy
when nobody else is paying attention” buy
when it’s quiet, when there’s no hype in
the market. now that took about two or
three years for me to have those
realizations. In traditional markets the
cycles tend to go for about seven years
so it might have taken me 14 or 21 years
to have those kind of realizations to
get enough data to click it over in my
mind to come to the right conclusion
about when to buy and when to sell
everyone who gets involved in
cryptocurrency is going to get this
crash course in bubbles in mass hysteria
and hype and they’re gonna get immunized
to it, people are gonna start to learn
that “it’s different this time” doesn’t
really mean what they think it means
people are gonna know on a personal and
deep level what a market cycle is, and
what hype looks like, what irrational
exuberance looks like. Markets will start
to smooth out because people won’t be as
willing to buy into bubbles and that
means people won’t be is willing to buy
into scams and that means if you want to
gain wealth you can’t just rip people
off you’re going to have to give them
something of value, something of
long-term value which is going to help
humanity and so in the end I think the
dream of cryptocurrency is that
humanity’s wealth is going to expand
because of these rapid-fire lessons
in bubbles. thank you so much for
listening to Cryptonomics, thanks for
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