Bitcoin’s 19th Doubling

Thank you to the many that joined our webinar last week. Judging by the turnout, Christmas was a quiet affair for most. I briefly covered Bitcoin’s monumental doubling events since it was first seen at 6 cents in July 2010 (first recorded price is debatable but it’s close to that). I said the next double would come at $31,457, which was 10% away. Little did I know, that would be reached within days.

Bitcoin Doubles

Source: ByteTree.

The Bitcoin Doubling Counter

Source: ByteTree.

Stimmy Checks Showing Up

Source: ByteTree. Heatmap.

The Cloud Over Tether

Tether is a US stablecoin that aims to mimic (or peg) the value of the US dollar. According to CoinGecko, it is the largest stablecoin and 3rd largest digital asset with a $21bn market cap.

Counterparty Risk — Pre-2020

Tether’s opaqueness warrants skepticism. For the less versed in Tether’s previous mishaps, the stablecoin promised 100% currency reserves, meaning that a ‘real’ dollar would be redeemable for each Tether coin. However, as many realised in May 2019, Tether changed their small print to state that cash, cash equivalents, and loans backed each coin.

Tether’s Peg — Pre-2020

Source: Bitfinex. USDT/USD chart.

Unbacked Circulation — Pre-2020

The most topical issue relates to speculation that Tether has been printing un-backed stablecoins for themselves and manipulating its trading pairs through ‘fake’ liquidity. There is absolutely zero empirical evidence supporting these claims; however, we recognise that these are a natural part of a bear’s tool kit.

Bitcoin Risks

Thank you, Tom. Tether is one risk, but another is just that price is seemingly ahead of events. Just to remind you of the obvious: good news occurs at tops while bad news occurs at bottoms. In particular, overly buoyant markets will eventually cause the stimulators to withdraw. And we don’t want that.

  1. There is a bull market in newly qualified Bitcoin experts.
  2. Volatility is back to high levels which will discourage institutional investors.
  3. Price is over-extended from short and long-term moving averages.

Bitcoin and Gold in 2021

Applied data for digital asset investors. ByteTree provides real-time data, fundamentals, technical and deep blockchain market analysis for Bitcoin, and more.

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