Did Satoshi Get It All Wrong?
We’re less than two weeks into 2018 and the market has given us all a big wake up call on who really controls the cryptocurrency market and dictates where it heads next or if it continues to thrive higher in value. That’s right, it’s the governments. The governments and every other global-influencing entity that can make one outlandish claim or regulatory strike and its bye bye cryptocurrencies and every investor with it. Will it ever get to that point? No, but what’s happened over the course of this week is a very humbling lesson of exactly what can happen if we don’t play ball with the ‘man’.
Evaluating the current market correction, if you can even call it that, it’s important to focus on what caused this and what it’s shown about the vast majority of participants in this market. It came to light yesterday that South Korea was going legislate exchanges and ‘ban’ them for alleged tax-evading and other illegal activities outside of the regulatory boundaries of the Korean authorities. The mainstream media outlets such as the NY Times, Reuters, Wall Street Journal, Financial Times, CNBC & CNN just to name the top few, all covered this story with some of the biggest misinterpretations of the true reality I have ever seen to date for a cryptocurrency related article. Titles and outlandish claims such as ‘RAID’, ‘CRYPTO’S BEING BANNED’, ‘EXCHANGES SHUTDOWN’ is the true definition of FUD (Fear, uncertainty, doubt) as a means to manipulate the market and cause a mass sell-off to benefit the pockets of themselves and those connected within the same networks of corporate governance. After reading such articles it’s no wonder the market started losing around 20% of its value in just a few days, you would have presumed the SWAT and military literally raided the exchange’s headquarters alongside a bomb squad and armed force when in reality the investigation was conducted by 2 individuals who simply went to visit the institutions and check all compliance and business conduct was in line with KYC regulations, nothing more, nothing less.
The fact is, once again this week we have been shown that against our will whether we want to face the truth or not, the government will always succeed in having the final laugh and profit off the sheep that contaminate this market like the plague. Cryptocurrencies are unregulated, which means a political figure could make one accusation and the whole market goes tumbling down a black hole of liquidating crypto's back to fiat. No such operation or financial market has ever gone unregulated for too long or allowed loopholes to slip through the cracks, which means regulatory strikes will swoop in like a vulture this year and clamp down on the unethical trading standards we all seem to love dearly in a bull trend, yet criticise and when the going gets tough. Having a market that barely posts a down day for months on end truly has clouded the judgement of what many consider regular investing activity. Banks and governments are adopting blockchain technology in real-time and have been for a majority of the prior two years, meaning as the blockchain technology begins revolutionising the system as we know it, these organisations will only grow stronger and align themselves with the modern tech to make sure they're always one step ahead of the game. If they're in this for the long-term and dictate the legislation/regulatory rules then who do you think has the biggest intentions to profit from this market whilst it's a complete wild west and can be sent tumbling at the flick of a switch? I'm sure you're following my point here. The truth is, we need these organisations more than we may think. The majority are in this market not to revolutionise the world but to make money, therefore, follow the money.
In such an irrational market, it's only natural we see irrational decisions alongside this and the correction has shown this like no other in both a scarily negative but more so a positive light on what we're in store for this year. Forums, chat rooms and social media has been flooded with a deep fear from the market pullback, where it's become increasingly obvious a majority of the new herd in this market have likely never seen more than two months of cryptocurrency mania that entails on a daily basis that the small handful have now become accustomed to as regular activity. FOMO (Fear of missing out) is a term frequented throughout this market regularly and rightly so, it's what drives this market to insane highs once the going gets good. A perfect storm being Ripple, Bitcoin, Ethereum & Litecoin as examples of new money jumping onboard with no logical backing whatsoever except the knowing price is rising, fast. When you think about how fast the market began falling and the lingering questions of "is it all over?" it makes sense that a lot of 'dumb' money began jumping onboard over the Christmas period when prices were at their absolute peak of all-time highs and nearing the boiling point of an overdue correction yet this would never cross the mind of new investors as they're driven solely by monetary gain which means when the slightest decline in value presents itself, the same logic applies and positions are liquidated before they can suffer any further emotional turmoil from financial loss. It's a tough cocktail of emotions and illogical mania but it tells me new money is flooding in faster than anybody had originally expected and the correction comes at a perfect time for the new herd both institutional and retail to re-evaluate their portfolios and get a feel for just how vicious this market can be in both directions of movement.
The new wave is coming and it puts 2018 in pole position to be a monumental mark in financial history.