The word “anti-fragile” gets thrown around a lot these days You hear it in podcasts, on the news and in articles
It’s a popular word but if you pay attention you’ll notice that it often gets misused Used correctly, anti-fragile doesn’t mean that something is strong, Rather, anti-fragile describes something that gets better as it’s attacked Most things are not anti-fragile, but then again, most things are not Bitcoin In 2020 Bitcoin was lambasted by the mainstream media, the price dropped 50% in one day and the regulatory landscape has become noticeably more hostile Despite all of this, as we enter into the first day of 2021 Bitcoin is less than $1,000 away from breaking through $30k
I think the lesson is: go after Bitcoin and it only gets better Bitcoin is one of the few things in the world that isn’t just strong, it’s anti-fragile In fact that’s our theme for this week: strength and performance Bitcoin has eclipsed Berkshire Hathaway in market cap, just as Polkadot has eclipsed Bitcoin cash Unsurprisingly, the demand for Bitcoin remains strong and the amount of liquid Bitcoin is continually decreasing
What do you get with high demand and low supply? Well, we’ll let you use your imagination for just a minute on that one as we open the curtain for 2021 on this week’s Exodus Crypto News Happy New Year everybody, it’s the 1st day of January and if Bitcoin is any indicator, it’s going to be a great 2021 Case in point It’s official: Bitcoin has done a value flip on some of the biggest names in the legacy financial system BTC is up more than 50% since the start of December, giving Bitcoin a larger market cap than financial giants like Visa, MasterCard and JP Morgan
Satoshi, if he or she is still alive, must be loving the fact that Bitcoin, which was created in response to large banks acting irresponsibly, now has a bigger market cap than one of the largest banks in the world! For crypto holders, one of the coolest things about this price rise is that Bitcoin now has a bigger market cap than Berkshire Hathaway For anyone not already in the know, Berkshire is the investment company run by Warren Buffet Although Warren is one of the most successful investors of all time, he’s no fan of Bitcoin Nobody in the crypto community has forgotten the time that Buffet called Bitcoin “rat poison squared” So there’s a bit of sweet justice in seeing the market cap of Bitcoin exceed the market cap for Berkshire
In fact, Bitcoin is beating Berkshire in both market cap and performance Bitcoin 1, Buffet 0 Out with the old, and in with the new Since the fork in 2017 Bitcoin cash has failed to prove itself as a viable alternative to Bitcoin Just a quick look at the BCH/BTC chart will tell you everything you need to know, it’s one long line down as Bitcoin Cash bleeds value against Bitcoin
Bitcoin isn’t the only asset that’s doing better than Bitcoin Cash though, as we’ve recently seen a flippening with Polkadot The blockchain interoperability platform Polkadot has taken over Bitcoin Cash’s number 5 spot on the crypto charts Not just by a few billion either! Polkadot’s market cap has grown to almost $8 billion while Bitcoin Cash’s has shrunk to $66 billion Who’s next? Litecoin? XRP? The thing about Polkadot is that it’s offering a service to the cryptocurrency community that could be tremendously valuable
Polkadot is creating a platform to join blockchains and create an interoperability standard between all of the major cryptos It’s an ambitious project, but if Polkadot can pull it off they will have justified their high spot in the crypto rankings Speaking of value, and for frequent watches of this show or if you follow me on twitter, you may think I sound like a broken record here because I talk a lot about Scarcity Scarcity is another key factor in determining how much a digital asset is worth The less liquid the supply is, the fewer coins there are to meet demand
In Bitcoin’s case what we’re witnessing right now is record high levels of hoarding Investors big and small are taking their Bitcoins off exchanges and the available supply is shrinking rapidly In fact, according to the blockchain analytics firm Glassnode, fully 78% of all Bitcoin has now been taken out of the market That leaves just 22% of BTC, about 42 million coins, to fulfill all of the rising institutional demand
For anyone who is surprised by Bitcoin going from $20k to just under $30k in only a matter of days, this lack of Bitcoin supply helps to explain what’s going on Why are so many people withdrawing their Bitcoin from exchanges and way does this latest run look different than 2017? There are a couple of good reasons First off, awareness is growing about Bitcoin, pure and simple The passing of the last All time high has helped bring BTC back into the spotlight And inflation, This time around, one of the main reasons that investors and institutions are buying BTC is to protect against inflation
And well, inflation isn’t something that just happens for a few weeks and then it’s over Inflation is typically a long term phenomenon that can go on for quite a while So if someone is buying BTC to protect against inflation, their timeline for holding BTC is probably years, not months What will happen if even more BTC is taken off exchanges? Less Bitcoin on the market means anybody who wants to invest is going to have to pay more per coin, which means higher BTC prices Or, in technical jargon, orange coin goes up
But remember, one Bitcoin is always worth one bitcoin so it’s never to late to enter the market From a purely crypto point of view 2020 was actually a really good year We’ve seen the explosion of DeFi, Bitcoin smashed its previous all time high and new projects like Polkadot are promising to bring all sorts of interesting functionality to the cryptocurrency ecosystem Having a look at the charts we can see that since January 1st, Bitcoin has gone up a massive 330% Measured since the March lows, BTC has gone up approximately 550%
Ethereum is up 485% since January 1st and up 575% since the March lows We can also look at the altcoin index, which is basically the market cap of all cryptocurrencies minus Bitcoin This index is up 156% since the first of the year, and up 220% since the March lows An impressive year, to be sure We know it’s been bad in almost every conceivable way, but crypto at least has been a bright spot in an otherwise dreary landscape
The team here at like to thank all of our viewers and subscribers, since it’s you who make this all possible Looking back over the year this channel has grown an impressive 87% since the beginning of 2019, we’ve posted over 165 videos and more than 150 posts to the Exodus Blog And on that note Happy new year and we hope 2021 is even better for your crypto than 2020 was If you’ve enjoyed this video please smash the like button and hit subscribe so you never miss out on new Exodus content Until next time, HODL on!
Recent Comments