Do you remember the last months of 2017 in the cryptocurrency market? It was everywhere. Even the MSM started talking about it, although its journalists tended to get it all wrong. The ‘haters’ compared it to the Tulip Fever of the 1600s, and when Bitcoin crashed after reaching an ATH of $20,000, perhaps they felt vindicated.
It has taken three years for Bitcoin and the altcoins to retake their 2017 positions, and who would have guessed that it would happen at the same time as the world was mostly staying at home due to a rampaging virus. But that is what has happened, and in the last few days we have seen Bitcoin break through the $40,000 barrier to become ‘virtual gold’.
The question most cryptocurrency owners must be asking themselves is this: is this bull run the same as in 2017? Jeff Wilser has taken a look at it, starting by saying, “for some reason this bull run feels different – not as mainstream, not as talked about, not as Paris Hilton-y.” Dare I suggest this is because people are more hooked on Covid numbers right now?
As Wilser says, there are ways to measure a bull run by looking at the frequency of Google searches for ‘Bitcoin’, and expert market analyses. However, what he has done is take a qualitative approach, to see how it ‘feels’, particularly to those he calls the “OG Bitcoin HODLers.”
One example is Erik Finman, the ‘Teenage Bitcoin Millionaire’, who bought 100 Bitcoin in 2011 with money his grandmother had given him. He dropped out of school at 15 and set up a crypto payments company, Metal Pay. Oh yeah, he also launched a satellite with Taylor Swift. He has a theory about why this new cycle is going relatively unnoticed: “The cultural space that was once occupied by crypto is now gobbled up by politics (Trump) and the coronavirus pandemic.” What did I say earlier?
“[Donald] Trump gets more clicks than crypto,” says Finman. Exactly! He thinks the Biden presidency may change that. Not because he dislikes Biden, but because he believes Bitcoin may be more interesting. And, if Covid-19 becomes about as interesting as the common cold that too will make space for crypto. It’s worth noting that during the shocking scenes of rioting at the Capitol on 6th January, Bitcoin surged by 10%.
Erik Voorhees, the CEO of ShapeShift, takes another view on it. He says: “You see the bull and the bust cycles that repeat several times over the last decade, and you see that each time bitcoin “crashes” the new level is higher than the prior cycle.” So, why the quiet now? Because, “We’re not in the real bubble yet,” Voorhees claims. It needs to get more exciting before the media starts shouting.
Others, such as Jill Carlson of Slow Ventures, says that with 20% of US dollars printed in 2020, Bitcoin has become a hedge against inflation. That doesn’t have quite the same ring for retail buyers as ‘When Lambo!’
There’s less hype this time round, but surely that is a sign that the market is maturing, and those of us who have owned crypto for some time are less anxious about the inherent volatility, while still quietly excited to see where this bull run goes.