After rallying as high as $10,000, Bitcoin fell off a cliff on Saturday. In the day prior to and in the hours after the closing of Saturday’s candle, the BTC price plummeted from $10,100 to a low of $8,100 — a drop of 20%.
It was a move that liquidated over $1 billion worth of leveraged positions on futures exchanges, and one that enticed Bitcoin bears to gloat. As crypto analyst Joseph Young jokingly put it, “the worst part of the dump isn’t the dump [itself], it’s Peter Schiff’s tweets afterward.”
The worst part of the dump isn't the dump, it's Peter Schiff's tweets afterwards
— Joseph Young (@iamjosephyoung) May 10, 2020
Bitcoin’s Biggest Cynics Gloat After Crash
Many of Bitcoin’s biggest cynics were quick to celebrate the stark reversal in the market, citing it as clear evidence that their bearish theses on BTC are true.
Nouriel “Dr. Doom” Roubini — a professor at NYU Stern and a prominent skeptic of current market conditions, for both stocks and Bitcoin — said that the recent drop validates his theory that crypto is manipulated.
“[It’s] a rigged, totally manipulated, whales-controlled market where most transactions (90%) volumes are false as exchanges pretend to have liquidity they don’t have. Massive pump & dump, spoofing, front running, wash trading! Total Scam!” Roubini scathed, channeling his sentiment that cryptocurrency is rife with scammers.
Bitcoin crashes by 15% in 7 minutes on NO news: a rigged, totally manipulated, whales-controlled market where most transactions (90%) volumes are false as exchanges pretend to have liquidity they don't have. Massive pump & dump, spoofing, front running, wash trading! Total Scam!
— Nouriel Roubini (@Nouriel) May 10, 2020
Roubini first found about the cryptocurrency years ago but has asserted that this industry is a space for charlatans and good-for-nothings.
Peter Schiff, a prominent libertarian economist known for his love for gold, echoed Roubini’s line.
The long-time cryptocurrency skeptic, who first found out about Bitcoin over five years ago but didn’t buy, argued that the recent rally is just speculators “selling the news” on the block reward halving taking place in a day:
“Looks like some of the Bitcoin speculators who bought in anticipation of the halving couldn’t wait for the actual fact to start selling. As more sellers jump the gun, by the time the fact occurs, the profits those buying the rumor were hoping to cash in on may already be gone.”
They Won’t Be Laughing for Long
But these bears might not be laughing for much longer, analysts have suggested.
As reported by Bitcoinist previously, prominent traders believe that the fundamentals of this market remain decisively bullish.
Tom Lee of Fundstrat Global Advisors, a New York-based market analysis firm, identified four such fundamentals. These factors, which suggest that medium-term market growth is likely, are as follows:
- Bitcoin is the best-performing “asset class” in 2020, beating U.S. Treasuries and Gold amid a global recession.
- BTC was the best-performing asset class of 2019, rallying 92% while the U.S. stock market gained around 20%.
- The block reward halving is just 24 hours out. It’s an event that analysts think will boost the cryptocurrency market due to supply-demand dynamics.
- Paul Tudor Jones, one of the world’s biggest macro investors, just announced his fund is taking a stake in Bitcoin futures. Jones believes the cryptocurrency will act as a hedge against inflation.