Ignore the Recent Bitcoin Surge
Bitcoin saw its value spike by $5,000 on Tuesday, an amount not seen since its infamous crash last November. That surge saw a large number of other cryptocurrencies increasing in value, however, there is little reason to become bullish on crypto.
If you are one to follow the crypto market, one thing is clear, the surge has created a near-euphoric feeling. Michael Arrington, the founder of cryptocurrency news site TechCrunch, put it best by saying, “I’ve never been more excited about crypto than I am right now”.
Brendan Bernstein, a former analyst with Goldman Sachs, was spoken to recently and called the cryptocurrency space the perfect storm. That might be hard to understand, but due to the rise of democratic socialism in the United States, the Trump Government has shown increasing interested in cryptocurrency and growing the financial wealth of America. Through brokerage firms, continued money-printing and legalised gambling, the American government will be able to increase the country’s wealth dramatically.
There is some bad news. The speeds at which governments, major companies and central banks are acquiring cryptocurrency have begun to slow down. This has been the result of increased hacks on crypto servers, new currencies dying out regularly and scheme brokerage firms popping up every month.
Bitwise Asset Management, a company working with the United States Securities and Exchange Commission had a presentation to SEC that showed 95% of all crypto trading was either non-economic or fake. They even noted fraudulent firms like CoinMarketCap and that fraud is taking place more regularly with higher risk exchanges.
Bitcoin is a small market when put in comparison to Global Forex Trading volumes that averages roughly $5 Trillion daily. Regardless, according to Bitwise, the cryptocurrency Bitcoin had more than $1.2 Billion traded in over 24 hours at the beginning of April. This is what caused the $5,000 increase in its value.
Bitwise continues to argue that even though there are exchanges that have better surveillance and security, there is still potential in the Bitcoin market. Unfortunately, Bitwise hasn’t been able to guarantee that the volumes will be real which has caused caution from governments and major companies around the world.
This could have all been the result of an April’s fool joke that the US Securities and Exchange Commission posted on their website on the 1st of this month. The post stated that two cryptocurrencies had been approved to trade funds legally. It’s speculated that trading bots went crazy, not picking up on the fact that this was technically all fake news. There was also a mystery buyer who believed the story and bought $100 million in Bitcoins.