hey, what's up guys bitcoin dropped by 10% in just last two days in this video i will explain why bitcoin was dumped and then i will answer the question if this is a good time to buy or sell cryptocurrencies bitcoin has registered its biggest price drop in the last 30 days as it failed to sustain break about 12,000 for the fourth time during this recent period after closing about twelve thousand dollars two days ago the benchmark crypto reversed its gains in the last few days falling below ten thousand eight hundred dollars that's a one thousand two hundred dollars or ten percent lost in just few days well to be quite frankly i'm not surprised pre-pandemic bitcoin dropped by 50 or so in a single day bitcoin is a volatile beast and can go up and down in double-digit percentage at any given moment similar happens to ethereum and other cryptocurrencies just few days ago ethereum reached its new local high of about 488 a coin it was so close to break 500 level but it didn't at least not yet right now ethereum trading slightly below four hundred ten thousand dollars a coin that's more than seventy dollars lost per coin and if it turned into percentage that would be sixteen percent lost yes it dropped more than bitcoin indeed but let's not forget the huge outperformance that ethereum has over bitcoin in this year so far there are two potential reasons for this cryptocurrency dump first reason for the declining cryptocurrency space is the dollar strength strong dollar trends in the last few days can decrease the investor's appetite for cryptocurrencies and even precious metals but over a long time i have no doubt in my mind the dollar will decrease as fat printing countless of papers and aiming to increase inflation the dollar softing over five percent could be a catalyst for bitcoin to reach 12 000 level once again bitcoin has a strong inverse correlation with us dollar in the recent months as investors feared that the dollar would further lose its value they moved to asset classes such as bitcoin and gold which have shown they can retain or appreciate in value in time of economic uncertainty both bitcoin and gold had a strong performance this year so far yet there is another and one direct reason why bitcoin dropped today two bitcoin transactions from mad gox called wallet occurred early this morning there were two transactions sent to another address of the total value equals to 824 bitcoins which is worth around 76
7 million dollars at this time it does not mean that they sold 8214 btc but if they do the price may dump even lower now let's take a look at the famous bitcoin bull mike novogratz that isn't so bullish on bitcoin and other cryptocurrencies in the short term let's take a look at this video let's start with this environment right now uh which last time you were with us we talked about the low rate environment how it's pushing a lot of people into different assets but um what has it meant do you think in terms of the viewpoints on cryptocurrencies so listen you know crypto like any uh any of the other speculative assets has benefited immensely from a perception of zero interest rates forever and central banks just jamming liquidity in like they're trying to feed a foreground duck you know you're you're you're jamming the food into the into the duck and um and so we've seen a a nice move in the bitcoin price we've seen a a stellar move in the ethereum price that's based around this burgeoning new space in crypto called decentralized finance and what you're seeing in d5 which is really interesting is really reminiscent of what you're seeing in tesla just a speculative frenzy there are new projects that are doing really cool things but they're getting such a surge of liquidity so fast uh it's changing at a speed i've never seen in markets uh there was a new project called sushi that was only launched five days ago and it's over a billion and a half dollar market cap in five days and so that worries me some you know it's while it's early in d5 to see speculative frenzy like that i mean i think about tesla today right tesla's a stock that's up 600 on the year that's trading at over a thousand times earnings uh was up 13 yesterday after being up 70 because of a split and they announced they're going to sell five you know billion dollars worth of stock and the market wants to trade up you know that's the power of this frenzy we're in right now uh it's it's irrational exuberance you can call it what you will i'm a little worried that we're gonna have a big correction in a lot of risk assets soon um i don't think it's a correction that lasts for that long because the liquidity machine is not being turned off but i think we're gonna go through a series of these bubbles and it feels close to being at peak bubble right now well there's there's a lot to unpack in what you said there mike let me start just with the digital asset part of things because a lot of people are just starting to get their head around bitcoin even though there's been a very long dialogue taking place on that cryptocurrency for many years but you looted the fact that you know you're seeing a lot of digital coins very quickly uh created and well received in the market in fact our our partners at bloomberg just put out a story about hundreds of coins being created and they they referenced a few others like pork chop and spaghetti and whale it sounds like you say that that caution's the key word with some of these new the these new coins what what's your ultimate takeaway for investors on these new names these new coins that are coming to market you know do your work have fun be careful uh listen i i lived through and profited through the 2017 crypto bubble and this feels somewhat reminiscent to it uh there it was the icos back then you know a new ico every day and the herd would would swim to that ico and jam the price up and there'd be a frenzy of liquidity and price and then it would collapse and they'd move on to the next thing and it feels a little bit like that i i think defy is going to be around longer i think that you are building infrastructure you know compound might exist in 20 years and we might trade interest rates not a jp morgan but on compound or some decentralized uh baby but this is still we're a sandbox right now and it's a sandbox that's getting liquidity like it's an adult industry and so it's it's it's be very careful um what's interesting is the bitcoin the new bitcoin buyer uh is an institutional buyer it's a high net worth buyer they're coming in methodically and slowly uh and they're not stopping and so that's keeping the bitcoin price up a lot of the traditional crypto people right are selling their bitcoin uh buying the sexier sexier objects and so in this move of this kind of mania which we're seeing in decentralized finance it's pushing ethereum price up because it's built on the ethereum network and other protocols it's probably putting a little head a little weight on bitcoin which tells you how powerful bitcoin is that even with that selling pressure it's still going up based on the macro story listen cryptocurrency is here for good and so i couldn't say that in 2017 2018 uh that sentence comes with an exclamation point starting this year right we we crossed the rubicon bitcoin is not going away uh the ethereum project is not going away it's got critical mass uh and you're gonna continue to see innovation after innovation i would still tell you that while bitcoin is a finished product as a store of value as a digital gold the rest of crypto you need to put into the broad venture bucket it's still a sandbox there are experimentation there there's spectacularly cool innovations happening but we're really really early i love all the new access points i love all the new participants uh people understanding how it works uh and i am positive in 10 years the ecosystem around cryptocurrencies bitcoin ethereum the whole space block shades is going to be multiple times bigger than it is today i agreed with mike novograt about defy projects new projects receiving lots of liquidity so fast just because of their dump names such as yam which already filled pork chops spaghetti even sushi list can go on and on and no this is not a restaurant menu these are what's so called defy projects what i think about this project is pump and dump scheme at initial launch this project is being pumped and soon after that dump follows and moving on to the next one it creates no value no utility so i would recommend staying away from this part of cryptocurrency market in the end of the day if you play with the fire eventually you will get wrecked it is very similar what happened in 2017 bull market run where icos was a new hot potato and attracted lots of hype around many ico's coins could increase by thousand percent but disappear in no time so i am not recommending to get into these new quote-unquote dfi projects but could this market salov provide with a new opportunity to buy some bitcoin in ethereum personally i think this price is still a bit so high and i would not be a buyer if bitcoin would drop to like 8 000 or so then i would be buying more bitcoin and if ethereum would drop to around 200 i would also be buying eth but in meanwhile i would not be buying anything if bitcoin ethereum price grows from here then it's great my portfolio would increase respectively and if cryptocurrency will drop from here then it's not that terrible news it will give me an opportunity to buy more leading cryptocurrencies it's like flipping a coin hats i win sale i do not lose much and still win in the long run if you're playing with those new projects hats you lose and sale you get wrecked i think it's obvious which game is better let me know what do you guys think about this recent bitcoin dump and why bitcoin dump in the first place leave your thoughts in the comment section below do not forget to report those cryptocurrency scammers and smash that like button
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