Mysterious Bitcoin Dip-Buyer Identified | Zero HedgesteemCreated with Sketch.

in #bitcoin7 years ago

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Amid the cataclymsic collapse of Bitcoin late on Friday night, the crypto currency suddenly saw a large buyer step in as prices plummeted below $6000. We now have an idea who that buyer of last resort was...

As a result of a giant publicity effort from its proponents, BCH saw mass investment as it heads towards a potentially contentious hard fork set for just after 7 p.m. GMT today. The failure of SegWit2x, coupled with endorsement from the soon-to-be-defunct Bitcoin Classic team meant BCH became the major 'competitor' to Bitcoin over the weekend.

But, as Reuters reports, former Fortress macro hedge fund manager Mike Novogratz - who we most recently profiled here - told Reuters Global 2018 Investment Outlook Summit in New York that he bought $15 to $20 million worth of Bitcoin over the weekend in that recent pullback.

The billionaire says his crypto fund 'Galaxy Investment Partners' owns Bitcoin, Ethereum, and many other companies, and coins.

"The institutionalization of this space is coming. It's coming pretty quick," he said.

Novogratz said he expects major financial firms will soon start to offer bitcoin or similar products as an investment option, one that could be easily purchased over the phone.

"When it's that easy, the price of bitcoin or ethereum is going to go much higher. And that is a lot closer than people think,"

His biggest regret this year has been not buying more cryptocurrencies when prices fell, because he knew that they would keep going up. He sees bitcoin, for instance, hitting $10,000 by March.

Novogratz previously said that, while bitcoin is a bubble, the mania is justified, because it is a technological advancement that promises to fundamentally alter our lives.

"I can hear the herd coming" Novogratz said.

And bubble or not, Novogratz concluded eloquently on the extreme nature of cryptocurrencies' potential...

"Remember, bubbles happen around things that fundamentally change the way we live," he said.

"The railroad bubble. Railroads really fundamentally changed the way we lived. The internet bubble changed the way we live. When I look forward five, 10 years, the possibilities really get your animal spirits going."

Bitcoin is set to become "the biggest bubble of our time," he added, and could reach $10,000 very soon due to fast-building interest.

But, we also note that Bank of Japan Governor Kuroda made some fascinating comments earlier that appeared to suggest selling yen and buying bitcoin:

Haruhiko Kuroda says he doesn't "see any serious problem arriving from cryptocurrencies at the moment."

"We are carefully watching the development," he says at an event of the Schweizerisches Institut für Auslandforschung on Monday in Zurich.

Additionally, Bloomberg reported that Kurodas warned "Japan's high debt-to-GDP ratio is not sustainable."

And as the chart below shows, the buying binge overnight really struck as Japan opened...

This move comes on the heels of American venture capital investor Tim Draper's comments (founder of the Silicon Valley VC firm Draper Fisher Jurvetson) that fiat currencies will no longer be in use in five year's time as they are to be replaced by cryptocurrencies.

At the WebSummit conference in Lisbon, Portugal, he told Forbes the fiat system will eventually disappear as people look toward coins like bitcoin or ethereum. He says its because fiat currencies are bound by country borders.

"In five years, if you try to use fiat currency they will laugh at you. Bitcoin and other cryptocurrencies will be so relevant … there will be no reason to have the fiat currencies," he said.

An unabashed promoter of cryptocurrencies, Draper said he fell in love with bitcoin not long after it was introduced in 2009. He bought 30,000 coins in 2014 (at about $600 each); they are now valued at over $214 million.

"This is the greatest technology since the internet,'' said the investor. "This is a sociological transformation, it's a movement.''

He also said that bitcoin will divide the financial services industry, at least initially.

"There will be a few who embrace it and jump out front and say, 'This is important' and then there are going to be those who jump back and say, 'I'm going to cling to the past, and I'm going to hold onto everything I've got.' And you know who wins then," Draper said. "It's always progress, it's always technology.''

Talking at the conference, he said investors should thoroughly study who's running the ICOs and whether their business plans seem legitimate.

Draper has rejected the possibility of the cryptocurrency market imploding like the dotcom boom in the late '90s, saying "people are always going to say there's a problem, and that usually means there's a lot more upside."

Finally we leave you with Dennis Gartman's comments tonight on bitcoin:

"this is a market for criminals and millennials."


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And this is exactly why Bitcoin will not fail contrary to what the fans of BCH are saying.

Wall Street is going to support Bitcoin full tilt. They are bringing big bucks. $20M is a drop in the bucket compared to what is going to enter this space in the next 2 years. And Bitcoin is at the top of everyone's buying list.

Finally we leave you with Dennis Gartman's comments tonight on bitcoin:

"this is a market for criminals and millennials."

Interesting Quote.

Millennial criminals

The only reason for time is so that everything doesn't happen at once.

- Albert Einstein

I do not believe the fiat system will disappear, but we should see appear crypto state cryptocurrency.

"In five years, if you try to use fiat currency they will laugh at you. Bitcoin and other cryptocurrencies will be so relevant … there will be no reason to have the fiat currencies,"
Probably, it's too little time to replace fiat completely and everywhere. but it can happen someday

We constantly underestimate the rate of change brought about by new technologies. In the US, that rate of change is slowed somewhat by existing infrastructure like the proliferation of credit card systems and our societies easy access to credit cards. Because of this, I think we'll lag behind the rest of the world in this movement. When it does happen, the change will be swift and will seemingly happen "overnight." Case in point, China went from 99.9% cash to 99% cashless using QR codes in less than 3 years: https://www.nytimes.com/2017/07/16/business/china-cash-smartphone-payments.html

Fiat is handicapped by being country specific, unlike cryptocurrencies. The release of electroneum is being eagerly awaited in Africa precisely for this reason. It is already gaining traction with multi merchant adoption.

Market and real life intetgration is key. DASH usability soundings could be pivotal. Coming round to idea that 'Bitcoin' will evolve as holder of value, and not a payment system, as will not want to spend much if keeps going up.

Could the solution be a fee only blochain ledgers that process all Cryptos, so the blockchains are cost neutral? Global or National/Regional payment setlement ledgers, could iradicate scaleability problems by giving a different blockchain option to transfer wallet to wallet. Perhaps future forks / rivals to BTC & BCH will be more useable with proof of life of holder, and recycling of lost or dead holder coins? Sustainability issue of lost coins seems to need to be resolved for a Crypto to be sustainable long term.