Penny stocks going 5x, bankrupt companies pumping 700% – why is the share market acting like crypto in 2017?
For the better part of two months now, bitcoin has been stalled. At the start of May, a few days before the halving, we pumped into the US$9000 range and have, barring the occasional fake out, stayed there. It’s been like watching two tennis players hitting a ball back and forth, both of them doing their absolute best to let the other player win. You get the feeling that when it does break it’s going to be an era-defining moment, but in the meantime I’ve seen episodes of Great British Railway Journeys with more verve and excitement to them.
Meanwhile, in the traditional markets, things have been, how do you say, effin’ ridonkulous. After shedding a third of their value in March, the US stock market is hovering back near all-time highs. In the case of the tech-focussed Nasdaq index, the all-time high has already been cleared. Destitute companies like Carnival Cruises and American Airlines have been posting 30% gains in a single day. At one point, literally bankrupt car hire company Hertz went from 80c to $5.50 – a gain of 700%.
Yet by every other metric America (and the rest of the world economy) is thoroughly screwed. So why has the share market shrugged off the apocalypse with such disdainful ease?
So, there are a few things going on here. The first is temporal, the second novel, the third structural. And yes, I am quite pleased with that summary.
First up: this ain’t over by a long shot. After the first, giant sell-off of The Great Depression, the market rallied 50% before continuing on its merry way into the basement. There are a couple of reasons why this time might be different – the present rally has been stronger and it could be easier for the economy to recover from the coronavirus than initially feared – but the point remains that these are early days and talk of a permanent recovery are premature.
Second is what’s being called the Robinhood effect – basically, a whole bunch of bored, newly unemployed young people at home getting into day trading thanks to stock trading app, Robinhood. And all power to them: they’ve made traditional money managers look like absolute patsies over the last few months. But if history is anything to go by – I’m looking at you Dot Com Bubble – when retail investors start thinking they can print money by randomly picking a three letter code and throwing money at it, it’s a pretty good sign you’re ready for a correction.
— Joseph S. Mauro (@jsmauro13) June 9, 2020
Show me the money
And finally, well, how good are these results? I mean, really. Because when you look at them real close, they lose a bit of their sheen.
Basically, it all depends on what you’re measuring the price against. Sure, you can measure it against the greenback, but so far this year the amount of US currency in circulation has gone up by around 20% thanks to the Federal Reserve’s policy of throwing money at a problem until it disappears. While inflation isn’t a 1:1 game, the US dollar is still worth significantly less than it was in January.
Measure it against the price of gold and the picture isn’t quite so rosy – by this metric, the S&P 500 has been in a bear market since 2018 AKA when people first started saying “I think the stock market may be a wee bit overvalued”. Measure it against bitcoin and, well, the last decade has been an absolute disaster. And while it’s pretty hard to buy your groceries with either gold or bitcoin right now, it’s a reminder that value is always relative and that inflation matters – to all of us.
Now come on, bitcoin. Make a goddamn decision already.
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By The Numbers: The Rate Bitcoin Must Climb To Reach $100K By July
Bitcoin is a numbers game through and through. There are only 21 million BTC. The code and its consensus algorithm are both made up of complex math. The total coins are slashed in half every four years, and so on and so fourth.
Most important of all, here’s the growth rate Bitcoin price must hit steadily to reach $100K per BTC by July 2021 according to one crypto capital manager – as well as the one thing that could get in the way.
Bitcoin Price Growth Rate Should Take Crypto Valuation To $100K By July
Bitcoin’s growth from virtually worthless to more than $60,000 per » Read more
” href=”https://www.newsbtc.com/dictionary/coin/” data-wpel-link=”internal”>coin came to be reads as if it was ripped from a sci-fi film: Mysterious person takes a shot at all money, and takes no credit for the monumental effort.
” href=”https://www.newsbtc.com/dictionary/satoshi/” data-wpel-link=”internal”>Satoshi’s creation is now more than a decade old and has grown far beyond most people’s expectations. Over the last year alone, the leading cryptocurrency by market cap has grown at a daily average rate of 0.65% since April, resulting in a nearly a ten times climb in value.
At the current pace, according to crypto capital manager Timothy Peterson, Bitcoin price would reach $100K by June 30th.
At only a daily growth rate of 0.64% the top crypto should hit $100K by July | Source: BTCUSD on TradingView.com
The One Factor That Could Cause BTC To Fall Short Of Target
Bitcoin price must maintain comparable momentum over the last year to keep climbing at a similar rate and reach more than $100K per » Read more
” href=”https://www.newsbtc.com/dictionary/coin/” data-wpel-link=”internal”>coin. The number is now closer to the current price action than $10K is, and thus potentially more achievable.
Price predictions for the next cycle top reach as much as $400K, with estimates more steeped in reality ranging from $125,000 to $325,000 per BTC.
The rally could really be over if the historically accurate signal is right again | Source: BTCUSD on TradingView.com
There’s a chance, however, the cycle top is in, according to the Pi Cycle Top Indicator. If the historically accurate tool is right yet again, the leading cryptocurrency’s daily growth rate will begin to decline from here on out until another bull market breaks out.
Bitcoin price wouldn’t make it to $100K by July, and a return to prices much lower would follow. If that’s the case, crypto investors would have to wait a while longer for the number one cryptocurrency by market cap to reach that ultimate target.
Featured image from Deposit Photos, Charts from TradingView.com
Bitcoin’s time has come: TIME magazine to hold BTC on balance sheet
Institutional fund manager Grayscale has partnered with acclaimed New York-based magazine TIME to produce an educational video series on the subject of crypto assets.
The partnership was announced on April by Grayscale’s CEO, Michael Sonnenshein, with Sonnenshein revealing that TIME and its president, Keith Grossman, will receive payment in Bitcoin.
Further, TIME does not intend to convert the Bitcoin it receives through the deal into fiat, and will hold the crypto asset on its balance sheet. No further details of the partnership have been revealed so far.
— Michael Sonnenshein (@Sonnenshein) April 12, 2021
TIME was first published on March 3, 1923, with the magazine and online publication having been active in the crypto space of late. In March, TIME cashed in on the NFT mania by dropping a set of tokenized magazine covers on NFT marketplace SuperRare, with the “TIME Space Exploration – January 19th, 1959” NFT fetching 135 ETH worth almost $250,000 on March 30.
“The media industry is undergoing a rapid evolution. TIME is seeking a Chief Financial Officer who can help guide its transformation,” the listing said.
According to Bitcointreasuries.com, TIME will become the 33rd publicly traded company to hold Bitcoin on its balance sheet. TIME joins the ranks of top U.S. companies Microstrategy — who have invested billions into BTC from August 2020, Square — who added 4,709 BTC to their treasury in October, and Tesla — which purchased $1.5 billion worth of BTC in January. Multinational investment corporation Blackrock also began dabbling in crypto during February, profiting more than $360,000 from a small long using Bitcoin futures.
This deal marks a significant partnership between giants of the mainstream and crypto worlds. Grayscale was founded in 2013 and has $46 billion worth of crypto assets under management, including roughly 3% of Bitcoin’s total circulating supply.
Moonstake integrates with Sylo to bring their staking protocol to the Sylo Smart Wallet
Moonstake, a staking pool protocol and service provider, has announced a new partnership with Sylo, a decentralized software development firm and the creators of the Sylo Network and Sylo Smart Wallet.
Through this collaboration, Moonstake will connect Sylo with their robust API/SDK solution, thereby enabling staking functionalities in the Sylo Smart Wallet and allowing Sylo users to earn passive income from their idle crypto assets.
Founded in 2010, Sylo is committed to decentralization and has created an ecosystem consisting of digital consumer wallet software, applications, infrastructure, and developer tools in order to usher in a decentralized future worth looking forward to.
A unique wallet app that combines digital asset management with decentralized communication, the Sylo Smart Wallet is a savvy decentralized e-wallet that enables users to purchase, store, track, send, and receive crypto assets, explore the world of Ethereum dApps by means of a Web3 Browser, pay with cryptocurrency in the real world, and provides secure communications by chat or audio/video call.
“We’re pleased to offer our community of global users yet another way to access the benefits of crypto. As always, our user flow has been designed with simplicity in mind, and staking via Moonstake in the Sylo Smart Wallet will make earning from digital assets simple enough for people everywhere.”
– Dorian Johannink, Co-Founder and Business Director of Sylo
Born over a year ago with the aim to create the largest staking network in Asia, since its inception Moonstake has developed highly user-friendly wallets for both Web and Mobile (iOS/Android) that are compatible with over 2000 cryptocurrencies.
After a full-scale operational launch in August 2020, Moonstake’s total staking assets have grown rapidly to reach USD 800 million in staked assets over just six months. Within a year of its founding, Moonstake became ranked in the top 10 of the world’s premier staking service providers and it continues to strongly expand its business.
“The Sylo Smart Wallet is an interesting e-wallet that combines the functionality of a flexible digital asset management tool and a secure instant messaging app. We are happy to help proper crypto projects like Sylo enable staking in their wallet so that users can have more ways to earn with crypto. With a wide selection of PoS coins and attractive yield rates from our high-quality staking pools, we are confident that users will be pleased with their staking experience on Sylo powered by Moonstake.”
– Mitsuru Tezuka, Founder of Moonstake