“Nobody goes there anymore. It’s too crowded.” Or: Why I bought Ethereum this morning after liquidating my other Crypto holdings last night *prior* to the selloff…
A quick disclaimer: I'm not knocking anybody for choosing their own personal journey through Crypto. This is just how I'm seeing things at the moment.
First off: I'm new to Crypto. And like all n00bs, I've been doing my best to research everything I can. I still have a lot to learn.
Big surprise (to nobody): initially, I saw BTC as a fun & exciting way to enter into the fray. BTC was everywhere I looked when I began researching Crypto. From financial analysts to celebrity tweets: everybody had their opinion. In what seemed like the blink of an eye, Bitcoin was unavoidable.
This was both good and bad.
It was good because there was a wealth of information available. (There was free crypto on Coinbase!) It was bad, too, because I was often left wondering whose information I could rely on. So much of what I read seemed like speculation. Or manipulation…
Then came last night's mini BTC selloff.
I wasn't surprised by it. In fact, I would've been surprised if there *hadn't* been a selloff. Even so, I was disappointed because the selloff convinced me of one thing: to my knowledge, Bitcoin (at the moment) isn't being used for the purpose for which it was created. As for my (extremely limited) understanding: BTC was designed to be a stable hedge against centralized, government-controlled inflation and deflation. (Among many other things….)
Why didn't last night's selloff surprise me? I got into BTC with a VERY modest, fractional amount when its price was hovering around the $48k mark, so I'd seen the mini selloffs at $51k and $56k. No big deal. Plus, I was still learning, so I didn't fully understand what or why those events were happening.
Still, I watched with excitement as BTC approached $58k, thinking that it would continue its upward trajectory, as some reports had indicated…
But sometime during the middle of the day yesterday, something just didn't sit right with me. It's almost like I suddenly sensed a great disturbance in the Force, as if millions of voices suddenly cried out in terror and were suddenly… oops, wrong script.
In all seriousness though: I guess I just put two & two together and realized that a $58k selloff was coming. It's not rocket science: people see a new high on the horizon ("free money!") and they sell. And guess what? The moment BTC hit $58k, the selloff began immediately.
All of a sudden, it seemed to me that the people who were investing in BTC weren't buying into a product / idea / technology that they personally supported or believed in. In fact, it was just the opposite: investors were pumping cash into a reasonably predictable machine that could (or might) make them some quick, easy money. (Nothing wrong with that, but more on that later…)
So, I started thinking to myself: Yes, BTC continues to "recalibrate" and then gradually rise after each "milestone-selloff-cycle". However. More and more it seemed like larger "institutional" forces were treating BTC like a casino. A casino that *they* owned and controlled.
It felt like I could start "timing" events: 2am-3am selloffs, 10am-ish selloffs, Bull/Bear runs beginning occurring at 10min-15min intervals on some days… it was like a rollercoaster ride. But just like a rollercoaster ride there's a beginning, a middle, and an end. And then it repeats itself. If you learn "the track", then you kinda know what to expect. Now, I didn't *always* know what to expect, but I'll wager that some institutions with a lot of money knew *exactly* what to expect and exactly *when* to expect it.
Just like Old Faithful: as each new threshold neared, people gathered around to "ooh" and "ahh". Then as soon as it popped everyone scrambled away with their earnings and the process began again. Rinse and repeat.
Now, there's nothing inherently *wrong* with this. And I'm new here, so correct me if I'm off base… but do people see BTC approaching its own "jumped the shark" moment?
With each new day / week / pump and dump cycle, BTC seems to be functioning less and less as how it was designed to function. So, if a currency stops functioning in the way in which is was designed… then will people start losing faith in it?
I quote Yogi Berra in my post's title. Asked about a popular restaurant, Yogi answered, "Nobody goes there anymore. It’s too crowded." Well, is BTC too crowded? Is BTC now saturated with so many people who are just treating it like a gold-rush and creating even more volatility than existed prior to BTC's mainstream awareness?
Anyway, this is my way of saying that I see ETH as a far more stable long-term investment, even if I only really understand a fraction of its capabilities and its purpose.
Final thought: this post may seem a bit "doom and gloomy", but in all honesty I can't remember when I've had so much fun researching finance, new technologies, and new opportunities for investing. So I promise: there's no "doom and gloom" intended in my post at all. (Plus, reading other people's posts in this forum & their thoughts & analysis has been fantastic as well.)
It's been a blast so far, and it's really only the beginning, both for me and for Crypto, and I plan on continuing to be a part of the Crypto community "for-ev-er".
And with that, it's time to get off my soapbox & do some more research. Cheers!