If you’re into crypto, or currently contemplating dipping your toes into it, then you must have heard of Elongate.
What’s Elongate?
Yes, I’m referring to Elon Musk’s market moving tweet, reversing his stance on Tesla accepting bitcoin for Tesla purchases. In the aftermath of his tweet, Bitcoin retreated roughly 20%, down from $54K to wick down to $46K, recovering somewhat, before even more shenanigans brought the price lower. We’re currently hovering around the $45K mark.
Previously, Elon had moved the bitcoin market the other direction by announcing that Tesla had bought $1.5B worth of Bitcoin as part of its treasury reserve allocation strategy. Since then, the eccentric billionaire has been raging a war and brewing a love-hate relationship with the bitcoin community, while also shilling Dogecoin relentlessly.
I don’t know what his endgame is, but bitcoin has survived without Elon’s involvement, and bitcoin will survive in the aftermath of his game, whatever his ideal outcome is. We just have to ride out this current turbulence, which came rather timely as a correction will be healthy at this point.
Why, Elon?
Why is Elon doing this? Nobody knows. No doubt he’s brilliant, but he’s also prone to doing some stupid shit over the years. Eventually though, it doesn’t matter. Bitcoin has survived and thrived across even more FUD in 2017.
In 2017, China and India, multiple times tried to ban Bitcoin. Those have all been bigger FUDs than Tesla no longer accepting bitcoin as purchases. After all, how many sane folks will exchange their bitcoin (an appreciating asset) for a Tesla (a depreciating liability, albeit an environmentally friendlier one?).
I have a theory for this. Remember when Tesla sold some bitcoin last quarter? They announced that they had sold about 10% of their holdings, and Elon at the time stated that they sold bitcoin to prove to his board that there’s sufficient liquidity in the market for them to use bitcoin as a “cash equivalent”.
What if this series of tweets and news is to prove the infallibility of bitcoin, and that it is now more resilient than ever before, and that even the world’s richest person can’t tank the market? Sure, the market will be spooked a little, but over time, it will recover and fundamentals don’t change overnight just because an eccentric billionaire prefers a joke coin.
So, is Bitcoin Dead?
Far from it.
Even though events from the last 2 weeks have brought the fear and greed index to a low of 27, we are still at $45K, and I think this is a good base to start accumulating if you have any firepower left. After all, folks like MicroStrategy are still buying bitcoin, exemplifying dollar cost averaging into the asset.
DBS Bank has also launched their crypto custodian solutions, after launching their crypto exchange late last year. Now, their private bank customers can not only purchase and trade crypto through DBS, but can also entrust DBS to hold onto their coins for them.
Enterprise solutions and support for blockchains, across bitcoin, ethereum and other blockchains remain at very high levels of activity, and don’t seem to be stopping anytime soon. Once the pandora’s box is open, you can’t cap it again. Price will follow activity and volume.
In the meantime, I have one word for you. HODL.
If BTC ever gets near its 200-week MA (or 1000-day MA) load up like hell.
I’ll consider BTC severely impaired (or dead) if it drops significantly below that MA.
Its 30% 14-week RSI level also shows an accurate bottoming of price in the past few years.
With all that said, I think BTC gains going forward will be more tempered. The momentum & emo & insta gratification crowds will move on to more exciting cryptos.
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