People tend to take victory laps prematurely – both bulls and bears. From its most recent peak at $65 000 in April, Bitcoin’s precipitous fall to around $37 000, at the time of writing, represents a crumbling in the recent edifice of invulnerability among a newly-minted generation of crypto tycoons. (For the purposes of this piece, we will use Bitcoin and crypto synonymously).
Is it a loss of faith in new age “market gods” like Elon Musk, on-off supporter then detractor of Bitcoin? There is also the curious case of the DogeCoin millionaire Glauber Contessoto, who famously continues to HODL after staking his entire net worth on the meme coin, garnering his own troop of followers through the land of “diamond hands”. Maybe it’s China cracking down on Bitcoin while preparing to launch its own digital yuan? That said, if you followed the herd and bought at the peak, remember, herds tend to get slaughtered.
Perspective is important, so let’s zoom out. Recent gamification and “memefication” of markets erode the underlying merit of cryptocurrencies as an asset class.
Firstly, let me say that I support the ideological basis of why crypto exists. Crypto is an interesting innovation and this is likely just the start. Major central banks are also looking into this space, not just as regulators, but rather as potential issuers of central bank digital currencies (CBDC). The regulatory and policy implications as we move into an era of CBDC are huge; but a topic for another day.
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the {{IssueName}} edition of {{MagazineName}}.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
THE HEALTH OF SA'S MEDICAL SCHEMES
As the Covid-19 pandemic abates, finweek takes a look at the financial performance of some of the largest players.
The effect of Gilbertson's departure
With Ntsimbintle Holdings now the major shareholder of Jupiter Mines, it could change SA’s manganese industry.
Making money from music
Why investors are increasingly drawn to the music industry.
Conviction is key
Sandy Rheeder plays a critical role in Mukuru’s mission to open up financial services to the emerging consumer market in Africa through tailor-made technology solutions and platforms.
The post-pandemic toolkit
How CFOs can use technology to support growth.
Big city living exodus
Mini cities like Waterfall City and Steyn City are redefining city-style apartment living.
Big compact, big value
Handsome, with a hefty level of standard specification, the roomy Haval Jolion compact crossover is a great value proposition.
On barriers to entry
There are various ways in which a company or sector can achieve competitive dominance. They usually make for good investments.
Fear and greed in one index
To buck the trend, when markets are hot or cold, is a tough thing to do. However, it can deliver solid returns.
Africa's largest data centre facility coming soon
Vantage Data Centers plans to invest over R15bn for its first African data centre facility in Attacq’s Waterfall City.
