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96 sats \ 7 replies \ @grayruby 24 Jun freebie \ on: Mt Gox Dump Coming? bitcoin
Short term it will definitely put supply pressure on the market. Let's face it, many of these people are forced hodlers for a decade and are up immensely in their positions and will want to realize some of that profit even as prices drop significantly from ATHs. I don't think it will be as bad as some predict but I don't think it will be nothing. Also, we have to factor in the cascade it might create as recent etf buyers who are up 30% right now may decide it is also a good time to take some profits.
Long term I think it is great for Bitcoin to get this FUD cleared up.
I said at the beginning of the bull run that if we can have a bull market that clears GBTC, MT Gox and DOJ supply overhang and that prevents a parabolic run up, I am good with that trade.
I'll be interested to see how low it takes us.
When people were talking about ETF's putting a floor under the bitcoin price, I was urging caution because investors might suddenly get spooked by something stupid and dump their holdings. This definitely qualifies in my book as just that kind of stupid reason to dump.
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There is also the issue that funds that own the Bitcoin etf (around 20% of the etf market) will also want to allocate to the eth etf. I suspect that won't be new capital but some rotated out of the bitcoin products and into the eth products. (maybe 20% of their holdings). Crypto is just a bucket for them.
I expect a rocky summer and once all this is cleared up and we get a fed pivot in Sept or a signal of a pivot sometime in Q4 the second leg of the bull market will commence.
How low will we go in the interim? Who knows? 50k maybe. There has already been a big reduction in leverage from the ATH and you have already had a big repositioning amongst traders with the eth etf launch (but more of that could occur if eth performs well while Bitcoin drops) so I don't think we see the type of liquidation cascades we saw during the covid sell off and china mining ban but I expect we grind down over the next 4-6 weeks and then consolidate for awhile before moving up again come sept/oct.
Could be wrong. Maybe etf holders are more diamond handed than I expect, funds aren't selling to allocate to eth and only a small portion of Gox coins get sold and the market realizes it got it wrong and we jump back to ATHs by end of July but that seems unlikely.
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Crypto is just a bucket for them.
good point
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You should also factor in the possibility of the Biden regime getting really draconian towards bitcoiners. Lots of bitcoin donations are flowing into the Trump campaign and I think that makes us more of a target.
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Maybe but I think they have lightened their stance on "crypto" because they know it is a losing issue. No one is a single issue anti-crypto voter but there are a lot of single issue crypto voters. I don't think it is as large a pool as the coinbases of the world like to purport but they obviously got spooked or the eth etf wouldn't never have gotten approved. Odds were at 15% and then suddenly Trump is coming out saying I will protect your bitcoin and crypto and a couple days later the etf is approved.
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Maybe so, but they started backing off before Trump started drawing lots of political donations in bitcoin.
I wouldn't underestimate how vindictive they can be. We would not be a difficult group to demonize, if they set their minds to it.
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