Bitcoin was enjoying it’s bullish really in the cryptocurrency market from the previous two weeks. This bullish really of bitcoin hit everyone with surprise, but everyone was happy that after the bearish pressure of 2018, now bitcoin’s value is finally raising. Everyone enjoyed the bullish really and even predicted that it will go further.
But, again for everyone’s surprise, the currency started to going down with the bearish decrease. The currency went down the value of $12,000 today and trading at the value of $11,882.93 USD, with the loss of -0.20%. The currency has gained around 40% of the value in the crypto market in the previous week. This surprises everyone in the market. Even the CEO of the Bitwise Asset Management, Hunter Horsley shared his sentiment of disbelieve.
On June 26, he even showed his concern about the bullish really of the bitcoin on Twitter. He stated in his tweet that the strong monthly performance is good for crypto. But 40% gain in just one week is not good. He also gave three reasons for why this much growth is not good:
• Detractors will utilize this growth as a sign of a bubble.
• Regulators will get worried about the chances of hurting the retail investor.
• The regular investor might be worried about being bandwagon.
Let’s analyze all these points to understand the situation better.
Detractors will cry it out as bubble: Every bitcoin bullish parabolic sentiment has been welcomed up to the tulip mania of 1636. All the analyst and critics of the virtual currencies don‘t like it when bitcoin outperformed other assets in the global market. Then the greater strength of the cryptocurrency becomes the greater enemy for itself.
Since 2017, every bullish rally’s nature is parabolic and we can like this that every time is gained value steeply with less correction in its price. The excessive bullishness of the currency is the reason that the critics say it’s bullishness is just bubble or nothing else. The previous one week’s 40% gain of bitcoin will scare the critics of institutional and retail investors in the market. Even people who don’t understand bitcoin well, we say it’s value rise is just a bubble.
Worry of Regulators: This type of 40% increase in the value doesn’t happen with the other traditional assets such as stocks, commodities, and bonds. This the reason when an untraditional asset such as cryptocurrency gains this much it scares them. They see it as not mature and supposedly manipulation of the market. Only 116 wallets have hold of 10,000 and more Bitcoin, so it also doesn’t help in that way.
This also might the reason behind that the regulators keep on delaying the judgment of the Bitcoin exchange-traded-funds (ETF).
Expert investors don‘t want to look like a bandwagon: It is supposed of the expert investors to find the new big thing in the market for their clients. They do a lot of hard work to find something like that before anybody else. Presently, many of the investors hit fortune because of the marijuana industry. So soon there will be the next increase.
Now with the bitcoin success, no one wants to catch a word such as “cryptocurrency” after the gigantic surge of the Bitcoin. The definition for them doesn’t match with the increase of 40% of bitcoin, as they want to get in soon. And on the other hand, those who say something such as virtual currency will be ignored or others will take that person as a newbie in the market.
Horsely stated that “slow and steady wins the race” and he makes clear that why bitcoin’s 40% move is not good for the cryptocurrency market.