by Tom Luongo, Tom Luongo:
One of the oldest arguments against Bitcoin, and cryptocurrencies in general, is the Central Banker Attack. Anyone who’s spent more than fifteen minutes inside the crypto-world will have heard this one.
That’s the argument where the person tacitly admits bitcoin isn’t a scam or vaporware but then says, “Well, if it gets too big, they’ll just make it illegal.” What’s most baffling to me is that this argument is mostly made by those who swear by their gold holdings while simultaneously swearing at the central bankers for ruining the world.
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I get that it’s mostly a coping mechanism for watching crypto go ballistic while gold languishes under the control those same central bankers. And, in the past, I had a lot more sympathy for that perspective than I do now. Because today, at a total valuation around $2 trillion, we’ve arrived at that moment where the bankers and politicians are coming for bitcoin and cryptocurrencies and they are coming hard.
Since last week’s Coinbase IPO Bitcoin has been under constant and persistent attack. Bitcoin pushed through its former peak at $61,800 and since then there have been massive, coordinated dumps to push the price back down.
— Mr. Whale (@CryptoWhale) April 14, 2021
That pushed Bitcoin back below it’s previous high and COIN’s tumble from an overpriced IPO didn’t help matters.
Then Turkey announced it would, like India, that it would ban the use of cryptocurrencies as payments on Friday.
At nearly the same time, however, China announced it was allowing Chinese banks to import up to 150 tonnes of gold for retail distribution for the first time since 2019. This led some to speculate about a ‘gold-backed yuan’ but I don’t think that at all.
This was simply another counter-move to the ones made against the cryptocurrency markets. Like the Archegos Capital tac nuke that is still creating aftershocks throughout the financial system, China’s announcement sent gold, which was firming but still very vulnerable to the downside, through near-term resistance to close the week above the magic $1760 level.
One has to realize just how important gold’s non-confirmation of bitcoin’s rally has been to undermine it in the eyes of major money managers. Gold is an asset the central banks control most of the supply of. Bitcoin is the opposite, an asset the central banks presumably control none of.
So, when casting your eye around the market landscape who are the people, other than the bitter gold-only bugs, most bearish about bitcoin and cryptocurrencies? The ones who made/make their living off the U.S. dollar-based system.
Between them and those that have a kind of monetary policy Stockholm Syndrome there’s still a massive number of people who just can’t or won’t get involved at this point. At a minimum, many pros are simply waiting for a real correction they can get behind to finally take the plunge.
But bull markets, real bull markets, are brutal to people who refuse to get on board and the longer it goes on the more strident in their opposition they become. Hence the constant sniping and backbiting by people who should know better amplifying the truly clueless takes on the situation.