On Wednesday, we wrote about the potential crash on Wall Street. It is worth asking about how the bitcoin itself will behave at the moment of global crisis.
Everyone who has been on the cryptocurrency market for several years (from 2012 or 2013) remembers the price increases of bitcoins at the time of the banking crisis in Cyprus. The bull market in spring 2013 was even called a “Cypriot bubble” at one time. This stimulated the imagination of the digital currency community. You can easily find entries on forums from that time, from which emerged the image of bitcoin as an asset that will be a form of escaping wolves from Wall Street from falling stock indexes. Is this really going to happen?
Low volatility of the intro to the bubble?
In the last few weeks, the price of bitcoins has been exceptionally stable even when stocks lost ground and began to fall. Tom Lee, founder of Fundstrat Global Advisors and one of the most stubborn bulls on the btc market, said he was pleasantly surprised by the low volatility of cryptocurrency prices in those days. He told CNBC:
“It’s surprising, considering how small bitcoin is in terms of market capitalization, the total market level of cryptocurrencies is 200 billion dollars, and nearly 90 billion dollars of global assets actually saw the correction … so I’m pleasantly surprised.”
Lee thinks the BTC seems to be hitting the floor at $ 6,000, because he tested this level several times throughout the year and eventually stayed above it. Cryptocurrency prices may also benefit from the reversal of the upward trend in the dollar. The declines in the price of the American currency, together with the inflow of institutional investors’ capital, should be enough for the new bubble for the BTC. But what if the falling dollar will be accompanied by drops in equity markets?
Asylum during the bear market?
Mike Maloney, an economist, financial advisor and best-selling author of “Guide to Investing in Gold and Silver.” Protect Your Financial Future and the owner of GoldSilver.com.
“For the first time in history, everything seems to be [an economic] bubble at once,” Maloney said on his YouTube channel. Added:
“In 2000, the stock market only seemed vulnerable, in 2008 it was stocks and real estate, this time we are dealing with a bubble that could affect both shares, real estate and state bonds.”
However, the current global bubble is to bring a definitive apocalypse. Everything is to be played in three years.
According to Maloney, the property sector will once again be the source of the crash. However, while in 2008 the problem mainly concerned the USA and Great Britain, this time they also have: Canada, Australia, New Zealand and China.
In one of his statements on his website, Maloney stresses that investors can start to run in bitcoins. Why? In his opinion, people can no longer trust currencies that have not been backed by gold since the ’70s. The future crisis will be an introduction to the new monetary system:
“… there will be no more gold and silver. We will need a monetary system from a place ready for use, and such systems already exist today, they are called cryptocurrencies, and everything started with bitcoin. ”
Is it really like that? It’s really hard to judge. Remember that digital currencies are still something new in the world of finance (and public awareness). They were created in response to the problems of banks from a decade ago. But over the years they have benefited from the general bull market in traditional markets as an alternative, somewhat exotic asset in which you can invest . So will the market reward them in the era of eg stock crash? The moment when we will know the truth inevitably comes closer …