Think Like a Bitcoin Whale
Updated
This post is not based upon any real technical or fundamental analysis and is purely speculation. I’m just pontificating about what someone with a majority of their wealth made in Bitcoin, and perhaps still held in Bitcoin, might want to see happen in the crypto market.
Wealthy crypto investors don’t need the price of Bitcoin to skyrocket to achieve financial success, they’re already very wealthy. When someone gets rich, and suddenly they have a big stack of coin, they don’t want to gamble with that money. They want to preserve it, or at least they should.
A Bitcoin price that is constantly pumping without ever establishing a floor of support isn’t necessarily advantageous to someone who’s already enjoyed the momentous rise of Bitcoin’s value. They might want to see some testing of Bitcoin’s downside potential, and they would want to see Bitcoin perform well during those tests. This would establish confidence that Bitcoin should always be worth more than X amount, and confidence that their Bitcoin wealth won’t suddenly evaporate some day.
Have we seen Bitcoin establish a floor at any price? I’d argue, not really. 200 was kind of a floor, but no one who’s rich in Bitcoin wants to see their Bitcoins fall to that low of a value again. The next logical floor is about 3000. Bitcoin has tested the 3000 level only once. In my opinion, one test is not enough to truly establish a floor. You need at least two tests, but preferably even more.
This is why I don’t think Bitcoin is going to skyrocket from here. I think people who are already rich in Bitcoin want to see an actual floor of support made for their investment, and they may be inclined to sell above 3000 until that floor has been truly established. If Bitcoin tests the downside target of 3000 again, then Bitcoin would be in a long period of consolidation. This consolidation would serve as a floor underneath Bitcoin’s value and that’s what someone who’s already rich in Bitcoin might want to see happen.
Wealthy crypto investors don’t need the price of Bitcoin to skyrocket to achieve financial success, they’re already very wealthy. When someone gets rich, and suddenly they have a big stack of coin, they don’t want to gamble with that money. They want to preserve it, or at least they should.
A Bitcoin price that is constantly pumping without ever establishing a floor of support isn’t necessarily advantageous to someone who’s already enjoyed the momentous rise of Bitcoin’s value. They might want to see some testing of Bitcoin’s downside potential, and they would want to see Bitcoin perform well during those tests. This would establish confidence that Bitcoin should always be worth more than X amount, and confidence that their Bitcoin wealth won’t suddenly evaporate some day.
Have we seen Bitcoin establish a floor at any price? I’d argue, not really. 200 was kind of a floor, but no one who’s rich in Bitcoin wants to see their Bitcoins fall to that low of a value again. The next logical floor is about 3000. Bitcoin has tested the 3000 level only once. In my opinion, one test is not enough to truly establish a floor. You need at least two tests, but preferably even more.
This is why I don’t think Bitcoin is going to skyrocket from here. I think people who are already rich in Bitcoin want to see an actual floor of support made for their investment, and they may be inclined to sell above 3000 until that floor has been truly established. If Bitcoin tests the downside target of 3000 again, then Bitcoin would be in a long period of consolidation. This consolidation would serve as a floor underneath Bitcoin’s value and that’s what someone who’s already rich in Bitcoin might want to see happen.
Note
Oye..
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