5/27 ANDY HOFFMAN (CryptoGoldCentral.com): The Only Crypto Use Case That Matters
Whether Bitcoin is still in a bear market; or bottomed February 6th; remains to be seen. Only time will tell, and no amount of fundamental, technical, or sentimental analysis provides “inside information” on the answer.
Fundamentals scream, as loudly as possible, that the worst is over – particularly when the Mt Gox Trustee situation is objectively analyzed.
Technicals, as always, give mixed signals – depending on your point of view and the methods used. And while “sentiment” is the least reliable – and measurable – metric, it is anecdotally worse than any time since I entered Bitcoin 2½ years ago. The reason being, that OGs are frustrated as to why price isn’t reflecting the across-the-board advancements Bitcoin’s technology and adoption are experiencing; whilst new investors are selling en masse, to avoid further losses.
As for institutions, my guess is that they, too, are in deep loss positions – having entered after the price exceeded the $100 billion threshold ($6,000 Bitcoin); and thus, are not confident enough to add to positions at current levels. That said, the reason they entered in the first place – aside from momentum trends, of course; was Bitcoin’s store of value proposition; i.e., the ONLY crypto use case that currently matters…that ONLY Bitcoin can provide.
Don’t believe me? Than consider that during this period of dying crypto sentiment; and more rapidly dying use cases; Bitcoin’s hash rate is at an all-time high…whilst Ethereum’s is in freefall.
https://twitter.com/Andy_Hoffman_CG/status/1000053926828298240
https://twitter.com/Andy_Hoffman_CG/status/1000707024869408768
The same is true, of course, for essentially all other altcoins – given that, generally speaking, their only “use case” is speculation. This has made them extremely vulnerable to hacks – as occurred at BGold and Verge this week; whilst Bitcoin’s has become LESS vulnerable.
In other words, Bitcoin’s principal use case; the ONLY crypto use case in the burgeoning Digital Age…store of value; is strengthening, whilst “competitors” are rapidly dying. Sure, a renewed bull market will “save the day” for altcoins – as increased speculation yields increased hash rate; and in turn, increased network security. However, for the time being, altcoins as a group are being exposed…whilst Bitcoin’s core strengths are being enhanced.
No investment class, EVER, has been subjected to the FUD Bitcoin has dealt with throughout its nine-year history. The reason being, that 1) few understand it; 2) many are threatened by it – including the world’s leading political and monetary powers; and 3) its extreme illiquidity makes it prone to dramatic price movements. Thus, it’s no surprise how many FUDsters are out - yet again, claiming a Bitcoin apocalypse is upon us…damn the fundamentals.
https://99bitcoins.com/bitcoinobituaries/
In times like this, it’s best to consider why you own it; and why what appears to be the best store of value invention ever made; by man or Mother Nature; would collapse in price when all the reasons it became popular are as valid as ever.
You are right on,Bitcoin is a great store of value and human effort and only with that one (but not exclusive) trait, it is a valuable asset people should own. LTC will be there for transactions, BTC will be sovereign treasuries.