The OG crypto currency Bitcoin is dropping in perceived value, having gone from over US$105,000 a unit to around US$83,456 as of writing.
Why exactly that is happening is anyone's guess. Trump's tariffs, United States' consumer confidence dipping the most since 2021, big outflows in Bitcoin-backed exchange traded funds, or Argentinian president Javier Milei's alleged LIBRA memecoin rug pull might indeed have spooked speculators. Other crypto currencies are also drooping.
A huge recent hack of US$1.4 billion in the Ethereum crypto currency at the Bybit exchange, most likely by North Korea's infamous Lazarus Group, can't be helpful either. Bybit co-founder Ben Zhou announced the exchange has produced an incident report on the hack, saying it wasn't their fault but a compromised Safe.global developer whose computer was compromised:
Bybit Hack Forensics Report
— Ben Zhou (@benbybit) February 26, 2025
As promised, here are the preliminary reports of the hack conducted by @sygnia_labs and @Verichains
Screenshotted the conclusion and here is the link to the full report: https://t.co/3hcqkXLN5U pic.twitter.com/tlZK2B3jIW
Maybe there's some rationality to it all, maybe not, but there's a curious gadget from Alternative.me that tries to measure bearish and bullish crypto sentiment, the Bitcoin Fear and Greed Index (BFGI). It's a simple device that goes from 0 to 100. Right now, things are looking downbeat on the Bitcoin front, contrary to expectations of a crypto-friendly Trump administration coming in:
Whether or not the BFGI is worth paying attention to is another issue, but Alternative.me is no doubt correct in saying that the crypto market is driven by emotion. So's much of our economy in fact. Look at Nvidia, the chip maker powering artificial intelligence (AI) worldwide. The company put in better than expected results, indicating AI is still hot stuff with loadsamoney being sunk into the tech.
However, the results weren't as insanely good as investors wanted them to be, and now Nvidia which is a whale-sized player on the share market, is sinking hard and fast.
29 Comments
The OG crypto currency Bitcoin is dropping in perceived value, having gone from over US$105,000 a unit to around US$83,456 as of writing.
Let's give it some perspective. Down approx 20%. Based on previous cycles, this is nothing and should be expected. If ratty doesn't fall 30-35% in a bull market or upwards cycle, then it's potentially an indicator that the market is maturing. During the 2016-17 bull run, the BTC price fell 6x at magnitudes of 30%+. So realistically we should get to somewhere between $70-$75K before things calm down. This is how free markets should work.
And the real damage is happening further out the risk curve where all the degens congregate and are positioning themselves for the 100x moonshots that they're using leverage to amplify their potential gains. Teens, university students, incels. In some ways, they're behaving rationally. The boomers won't get it, but the boomers themselves are responsible for creating the dystopic environ these people live in.
Most FMCG companies are woefully under-skilled in how to set prices accordingly - elasticity, etc. Most commercial people wouldn't even know where to start to know to measure the optimal price points. This is the type of stuff that should be taught in business schools.
Bitcoin must be the only asset class where long term investors (like myself) are actually happy to see decent price drops. I just brought a reasonable amount overnight. When you are certain this is a minimum 19T asset class in the future, this is just an opportunity to accumulate. I believe you shouldnt be buying BTC unless you have a minimum 8 year horizon (2 halvings). Dont worry about noise like this.
The old sharemarket adage of "buy when there is blood in the streets" is very applicable here. When you see the Fear and Greed Index at these levels that is always a good time to load up. To be honest this isn't even that significant a pullback for mid bull market. From the high of $109k to the current low of $82k that only a 25% drop. Previous bull markets have seen multiple 30%+ drops on the way up. This is no big deal, I used to see my portfolio drop 25% in a day.
Bitcoin must be the only asset class where long term investors (like myself) are actually happy to see decent price drops.
I share the same sentiment Lassie. Why do people only want to buy assets when the price is ascending not when prices are in the toilet?
People are happy to buy when ratty goes over 100K but would be paralysed by fear if it went under 10K.
That is counter cyclical investing. In shares it’s a challenge to identify the lows, hence the dollar cost average approach.
However, I don’t consider BC an investment, more a speculative asset. Recommendations to buy on the low are akin to Dutch tulip mania when the market collapsed and someone shouted ‘I’ll take the lot for 5 guilders’ and the next day regretted the purchase.
Yes, your first step is someone reputable who has been around for some time. But after that, from my experience using many of them, currency conversion and purchase fees are the biggest factor to consider (Obviously depends on how large an amount we are talking about). The most important thing is to withdraw to self custody quickly. DO NOT treat an exchange like a bank, because it most certainly is not. You should NEVER keep any bitcoin on ANY exchange that you are not actively trading with. For the vast majority of people, just buy the ETFs through your normal share trading account.
Just wait until these 'investors' require some cash due to the downturn. Everything will drop, including gold initially as the need for cash becomes desperate.
I think that the OGs understand well that BTC can plummet in price in SHTF scenario. We've already seen it in 2020.
As for gold, 100% that it will fall in similar scenario. Big difference now though is central banks are hoarding gold (doesn't make any sense to Lord Orr who thinks gold is for plonkers).
Because Zachary doesn't understand Bitcoin (and hasn't tried), he also doesnt understand how much conviction a bitcoiner who has been through at least two full cycles has. There is nothing financial related that I'm more certain about. Helped by the fact I'm equally certain that governments will continue to devalue fiat currency until it collapses.
As the most robustly and transparently provable scarce asset in existance, Bitcoin will continue to appreciate against EVERYTHING until after I'm long gone. I know that for those who don't follow this space it sounds like hyperbole, but a genuinely new asset class appears only once or twice a lifetime. Not only that but this is the first time in human history where the everyday citizen has been able to front run companies, banks and countries. Do you really want to have lived through this time period and not taken the opportunity that was presented?
Owing 1 Bitcoin is already out of reach for anyone but the 1%. Even 100 million satoshis (0.1 BTC) is now beyond all but the very wealthy. Very soon owing just 1 million Satoshis (0.01 BTC) will be the same.
Owing 1 Bitcoin is already out of reach for anyone but the 1%. Even 100 million satoshis (0.1 BTC) is now beyond all but the very wealthy. Very soon owing just 1 million Satoshis (0.01 BTC) will be the same.
That is actually an argument for it being worthless in the long run. I'm not saying it will be mind.
An interesting response to my question. Rather too defensive!
I think JC had made the claim about BTC dropping below 4K being a wonderful thing in a comment above however it was subsequently edited out. I was curious if he did genuinely think that. It is the sort of claim that many might find frightening. Like it's a perpetual Ponzi machine.
Always been sceptical about crypto. Anyone who buys crypto as an "investment" doesn't have a clue what an investment is. Crypto is pure speculation (and its extreme volatility makes it useless as a currency).
But I figured you have to "be in to win", much like Lotto, so I gave it a crack anyway. In 2017 I bought NZ$500 worth of BTC and NZ$500 ETH. In 2020 and 2021 I bought another $19k of crypto.
Then last year I used about $17k of my crypto to buy gold.
So currently I have about $3k of my initial stake left in crypto. Not long ago my crypto holdings (hodlings?!) had a market value of $80k, but after the latest correction it's about $60k.
Who knows what crypto will do - it may turn to complete crap, or it may continue to show average annual gains, like property markets and share markets.
Either way, I don't really care!
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