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As someone who has very little grasp of global markets, I'd kind of assumed that bitcoin and other cryptos would rally if stock markets were falling under a glo
by drcongo 7y ago
As someone who has very little grasp of global markets, I'd kind of assumed that bitcoin and other cryptos would rally if stock markets were falling under a global pandemic, but the cryptos seem to be tanking along with them. Is this down to reduced consumer confidence?
- overcast 7y agoThere's no one left in the world to get sucked into that scam, they all got obliterated in that last run to $21k
- OzzyB 7y agoMore like a "the world is crash and burning I want real cash in my pocket, NOW!" kinda thing. It's hard to buy toilet paper and water with Bitcoin at your local Costco.
- derwiki 7y agoCostco sounds as bad as a flight
- doubleunplussed 7y agoIt's hard to buy toilet paper at all!
- tunesmith 7y agoBuy a $60 bidet attachment, you savages!
- deleted 7y ago[deleted]
- TheSoftwareGuy 7y agoMore like reduced investor confidence, but they are correlated. Essentially, everyone wants a safe place to put their money right now. That usually means bonds (especially government bonds) and cold hard cash. Most people think of bitcoin as an investment, and a risky one at that. So they are taking their money out and putting it in safer places
- nsomaru 7y agoMy theory is that BTC is a “high risk” position/part of someone’s portfolio. So people are seeing lots of cheap stocks (high risk), noticing an opportunity and moving out of BTC to buy stocks. Just a theory.
- PragmaticPulp 7y ago> I'd kind of assumed that bitcoin and other cryptos would rally if stock markets were falling under a global pandemic, Cryptocurrency has been used as a speculative investment. It's riskier than stocks, so it has fallen further.
- qubex 7y agoYours was a widespread conviction born of the idea that bitcoin and other crypto-assets would be seen as de-correlated safe-havens for funds drawn from volatile traditional equity markets. The simultaneous drop in value is the very textbook definition of correlation, and therefore suggests that the same decision processes (perhaps even the same decision-makers) are operating in both types of markets and that, consequentially, bitcoin and crypto-assets are factually not alternatives at all.
- solotronics 7y agoEven more interesting is Bitcoin has been a leading indicator for tech stocks for some time now. Bitcoin drops often led FANG drops by a few days.
- qubex 7y agoOne of the prevailing ideas in several theories of financial market agent behaviour is that crashes occur when all or at least most participants’ horizons synchronise, leading to everybody acting on the same information uniformly. This is likely what is occurring: probably most investors are focussing on the here-and-now and thus on stopping their losses and/or reducing their exposure to risk.
- engineeringwoke 7y agoMakes sense. Good thought
- drcongo 7y agoExcellent reply, thank you.
- jules-jules 7y agoThe initial 2008 sell-off just like now also affected Gold negatively, although much less than Bitcoin now. I think BTC could be seen in a few years as a hedge against the USD.
- amiga_500 7y agoCouple of possibilities: 1. People who buy bitcoin also are in wallstreetbets selling options they don't understand. When they get a margin call and have to cover the money they lost, they sell bitcoin. 2. people in bitcoin are selling to transfer into stocks
- mattferderer 7y agoMy assumption is a lot of them moved their money to purchase options on the stock market or to cover their butts when one of those options went south. Not that I know anything about charts, but it did look like a head/shoulder chart as well a while back that would have suggested a dip was coming anyways.
- mseidl 7y agobitcoin has been dropping... https://www.bitcoin.de/de https://www.bitcoin.de/de The high at 12:00 am today was 7k now it's down to 5700 euro. People are selling at 5500
- CiPHPerCoder 7y ago"and other cryptos" "but the cryptos" Please say cryptocurrencies. http://www.cryptoisnotcryptocurrency.com/ http://www.cryptoisnotcryptocurrency.com/
- shawabawa3 7y agousage defines language not the other way around Like it or not, "crypto" now means cryptocurrency, and "cryptography" means cryptography
- Nasrudith 7y agoLinguistically they can both define it as they please really. Just like how a joint can be anatomical, a place, or a drug delivery mechanism. Really it is surprising that there isn't more contention over abbreviations.
- eivarv 7y agoUsage defines language not the other way around That depends on whether you take a prescriptive or descriptive approach.
- Analemma_ 7y agoAnd the prescriptivist approach is dumb, because no one has the authority to prescribe English usage. We don’t have an Academie française, and even English dictionaries explicitly disavow any intent to mandate correct usage and state that they are only cataloging real world speech.
- deleted 7y ago[deleted]
- TheAdamAndChe 7y agoIt's also context-sensitive. If you are talking about investing and mention crypto, it's pretty obviously implying cryptocurrencies.
- aabhay 7y agoIn a bull market, every explanation seems right. In a bear market every explanation turned out wrong.
- jaltekruse 7y agoI still assume it is possible and likely that something like cryptocurrency will eventually become incredibly valuable, but I see that happening only when technical and social hurdles are overcome to make it as widespread and scalable as the current credit card system for everyday transactions. Unfortunately for current cryptocurrencies, they just don't have what it takes to compete with decades of trust to get everyone to put their daily spending money in them, that is what will make a future system valuable. The current role they play as a speculative investment seems quite silly to me, literally they only thing they are good for is transactions, if you can't do that effectively I don't see value in the tokens at all. Imagine if someone started a stock exchange and listed a single stock, their own, the stock for the exchange itself, and no one else's. While you can buy some things with bitcoin or ethereum, it's nowhere near widespread, so that really seems to be effectively what it functions as for now, which looks very bizarre on its face. Unfortunately for the people who do want to get rich, if there is an eventual winner in crypto, their rise will probably look something like what we see now, limited buy in from speculators followed by some inflection point, so it's entirely possible buying this dip of ethereum or some other coin might be the right thing, but I'm just not sure any of them are ready yet. Even with SegWit and other stuff happening in bitcoin, it just isn't clear to me that becoming a cash or credit card replacement system is even the goal anymore, which seems like they are just riding on their first mover advantage to prop up the value more than anything at this point.
- Nasrudith 7y agoIf they were competing markets and the demand transferred sure that would make sense to see that dynamic. But it is common cause in this case and it doesn't privledge Cryptocurrency as it is a delivery and demand issue.