Market Watch: Dominance.
So today was pretty weird.
I wake up and Bitcoin is crashing to $33k.
Was feeling pretty good about that.
Because the day before I stopped myself from buying a potential bull trap.
Then hours later Bitcoin spikes up to $37k.
I swear this market just likes to psychologically mess with us.
It's like a constant test of patience and willpower.
In any case... look at the trendline.
Bitcoin has the most obvious trendline ever ever.
I can not believe how many people I've seen recently talk about the price dropping to zero when it hasn't even returned to the doubling curve yet. Like seriously, these investors have such thin skin and such a lack of patience that it simply blows my mind. Grow, up.
Seriously though I just want to shake people and be like...
WHAT IS THE MATTER WITH YOU IT'S DOUBLING EVERY YEAR!
Doubling.
Double.
Every year.
But somehow that doesn't matter.
Somehow it is NEVER enough.
If it's not obvious by now that society, as a whole, is guaranteed to always have insatiable infinite greed, then I don't know what to say. It's painfully clear at this juncture that it truly doesn't matter how well crypto performs. Every time the price goes down for literally any reason, people are going to complain and cry like a child that dropped their ice-cream cone. It wouldn't matter if the token just went x100 and they were still up x50, if the price goes down, it is the end of the world and it's all a scam and going to zero. Every time, without fail, this is not my first rodeo.
This psychology is actually very interesting.
Because it tells us exactly where this is all going. Which coin is going to be at the top of the market cap in twenty years? It sure as hell won't be Bitcoin, and it won't be Ethereum either, or XRP... nope. In fact, it is more than likely that the coin at the top of the market cap in two decades doesn't even exist yet. We don't know what it will be, but we know what properties it needs to have.
Top coin properties:
- It's a unit-of-account with a stable price.
- It is extremely inflationary.
- Yield/inflation/interest-rates expand and contract with the market, allowing the community to command a stable price point.
- It has massive interoperability with other chains.
- Value pours out of it into every other network.
- Likely has various incentives to get communities to work together.
If I'm being honest, RUNE / ThorChain could pull it off if they play their cards right. It is possible (however unlikely) that Hive could as well. Not that anyone needs to be number one, just that it's fun to speculate.
In all likelihood dominance will become a thing of the past and many of the coins in the top ten will have similar stacks. It's not going to matter much if one network is worth $100T and another is worth $120T. In crypto, that's close enough to be practically the same market cap. 20% difference is nothing.
The point here is that people HATE to lose money, so the first "only up" coin to pop into existence is going to be the one that everyone adopts, especially during any kind of bear market (or even fear of bear market). In fact, I'd be willing to bet that even if you could 'only' earn 50% consistent yield on this token it would still get more adoption and long-term growth rate than Bitcoin's 100% average yearly gains. That is how much people HATE red markets. They'd sooner take a 50% pay-cut than have to deal with the psychological ramifications of a bear market.
But the complaining doesn't stop there.
The tribalism complaints are constant. Remember when everyone complained that Doge mooned? Then they complained that Elon Musk was shilling it on Twitter. Then they complained that Shiba Inu mooned. Before that they complained that Ethereum mooned (BTC maxi), and before that they complained about Litecoin going up while the rest of the market dragged.
If it's not my bag then I'm going to complain about it filling up.
Market sentiment is flipping.
Remember how hard the maximalist cried when Bitcoin dominance dropped to basically all time lows and all the altcoins were going wild? Did we really think the script wasn't going to get flipped back into their favor? It's already happening right now. Dominance has already risen 3% to 40% in a matter of days. How much longer before it gets back up to 60%?
To be fair I don't think it will actually get all the way back up to 60%, but 50% is certainly still on the table. Bitcoin performs really well during uncertain times and bear markets. Bitcoin has a nasty habit of propping itself up by stomping on alts constantly during any kind of bear market. This is how it maintains the doubling curve so easily. It sucks liquidity out of the alts when we return back to the trendline and BTC becomes a good deal once again.
So yeah, if we get back to $30k, you sure as hell better think about getting some BTC, because we all know what it's like to watch Bitcoin double or triple in price while the rest of the market does nothing. If you don't have any BTC during those times, it is not a fun feeling. I know from experience
Getting flashbacks of 2018.
Back then I thought I could "diversify" my money into a bunch of ICOs and that was sure to keep my value protected! We all know how that turned out. During uncertain times, you buy more Bitcoin. End of story. There really is no argument. Bitcoin is the ultimate store of security. Do not fade the grizzled granddaddy of crypto.
Conclusion
Bitcoin dominance is moving up, just like we would expect during uncertain times like these. I can all but guarantee the doubling curve trendline for Bitcoin, but as for the alts? Not so much. Should we enter a "scraping the bottom" "bear market" Bitcoin will continue to gain dominance and suck liquidity from the alts into itself to maintain the trendline.
Luckily, we never had a mega-bubble. This means we will also not have a mega-bust. We really don't have to worry unless Bitcoin is trading under the trendline, which currently sits at $27k.
2022 Bitcoin Doubling Curve
| Jan | Feb | Mar | April | May | June |
|---|---|---|---|---|---|
| $27733 | $29867 | $32,000 | $34133 | $36267 | $38400 |
| July | Aug | Sept | Oct | Nov | Dec |
|---|---|---|---|---|---|
| $40533 | $42667 | $44800 | $46933 | $49067 | $51200 |
Fade the doubling curve at your own risk.
I personally will never make that mistake again.
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You are right that people don't want to lose money at the same time, they complain even though there is a rise. I laughed about Doge 😅... It's true that a lot complained about the rise of Doge.
Bitcoin has a lot of potential to come back up no matter how it dips, then I don't really see the reason why people complain except they are only investing for quick gains only, then they shout when it dips. This is common in Nigeria 😅, as well other countries I suppose.
I always say, don't invest money for food, but money you don't have use for. Be wise and not be after quick gains.
Yes, you are totally spot on. I remember when i use to rush these leverage trading longs with 50x for lucky pumps.
I agree. It better to play the crypto game with patience.
Watching the market hourly and day by will drive you nuts. But when you zoom out sanity can seep back in :)
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I have to sit on the sidelines for the rest of this. I spent my stables and I am not selling or trading my RUNE/LEO/CUB/Fantom farm/Cosmos farm... I am pretty confident that up will be the longterm trend... I can wait it out.
I slowed down on my BTC purchases because I wanted more RUNE and HIVE but I don't think I'm anywhere close to having a decent amount of BTC so I may have to start buying it again.
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True investors are those who get on to the market and are constantly learning. A quick observation is that a bulk of people have bill shilled i to crypto made to throw money at the spot market and think this is all about fluctuating coins or being a part of an elite club. Without researching or diving i to coin use case. I love the sound of Rune/Thor chain stand a chance, this is a place the investor should be coming from always having down their own research
Entering the investment environment takes your learning and especially when working with crypto. immediate liquidity causes euphoria in people I prefer a passive income based on term investments that is why I remain calm while I observe how the bear market fluctuates, in fact it takes advantage of acquiring a good amount of BTC.
Posted Using LeoFinance Beta
Given how bullish you are on BTC, what are your thoughts on the potential impact of UDST flopping in the near future due to rumors of being back by air? Do you believe BTC has simply reached a point of resilience that prevents it from being "dethroned", in a sense?
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After all, crashes are common in crypto markets. We saw massive crypto crashes in Q1 2020 and again in 2021. Whenever crypto market crash occurs, people worry that they are dead. The market recovered from each crash and reached new highs.
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Just wondering, what do you plan on doing if BTC does drop below the trendline? I do believe that BTC will be higher price in the future due to the deflationary aspects. I was planning on adding to my position if it drops down far enough.
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one thing that seems somewhat "strange" for the doubling curve is that the chart would imply that when btc let's say maxes out at 100k, there isn't really so much room left for it to fall. Perhaps if the "bear market" really starts in this summer prices wouldn't fall as dramatic as in the past. With btc becoming more stable the whole idea of "bull and bear markets" has to be reconsidered as well I think; and with btc dominance falling to under 30%, the market would start to look much more interesting with everything not correlated so much to btc
You drew that trend line such that the price goes below it (sometimes by quite a lot) on a fairly regular basis. So it's not unlikely that could happen again. If it happened now, the price could go under $20 and still fit your pattern.
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STOPCheck out the last post from @hivebuzz:
This makes me think if i can actually purchase BTC in installments or if i should just sit it out? 30k is millions of naira... Lol.
There's no reason that anyone needs to buy an entire Bitcoin.
Buy 1M sats if the unit-bias is throwing you off.
That's 0.01 BTC
Yay. I'll try that
Though i am not big on crypto but the simplicity of your words made me get some vital points
OMG better off on the watch than fall for it but i hope in due time the market will fall back to it's bullish move.
All we have to do now is spot for a potential bullish entry point and role with the wave.
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Yes, of course it's sad to see
but stay cool and think in the long run,
don't be emotional...
But I also hate all those crashes... 👀
Nope. If it's one thing I learned from you and really makes sense :) it's this doubling curve. This one makes a whole lot of sense now. Not even the four year cycles don't matter that much anymore.
Posted Using LeoFinance Beta
Bitcoin inflation is so low that it seems like the halving event doesn't even do anything at this point.
Bitcoin inflation essentially rounds to zero now.
Only 2M more Bitcoin to me mined in the next hundred years.