Dear Coiners, You’ve Just Been Musked

CRYPTOCURRENCIES

Crypto-traders and HODLers alike are affected by the wild swings in crypto prices. Elon Musk’s antics are an effort to profit off the little man.

If I was a crypto-evangelist, I would be tired of Elon Musk.

The Tesla CEO appears to have the power to move markets, even for the largest cryptocurrencies Bitcoin and Ethereum, with a few lines in a tweet.

And Musk is making a mockery of the entire crypto space. He seems to enjoy it.

Those who got lured into buying Bitcoin during Elon Musk’s Bitcoin appraisals near the tops in February, March, and April, probably aren’t enjoying it as much.

Pissing off the Bitcoin crowd and pumping the parody cryptocurrency DogeCoin (and even get rich quick scheme coins such as “Cumrocket”) could mark the turnaround for Elon Musk. It may be what brings him down.

At least, many Bitliebers have turned on Musk. Amongst them Changpen Zhao who is CEO of one of the largest crypto exchanges Binance. CZ, as he is often referred to, publicly whined over Musk’s tweets:

But is the problem here really Elon Musk?

If a man can move the market by posting a few sentences on his social media pages, doesn’t that reflect some broader structural issues with cryptos?

It raises questions of just how liquid the markets are.

Many small investors have bought into cryptocurrencies in hope of rapid gains, but miners extract significant amounts to keep servicing the network (the total amount of USD leaving the Bitcoin ecosystem alone through miners is estimated at $60 million a day).

As long as people keep their cryptos, or in coiner slang HODLe, there’s no problem. The exchange rate is inflated by stablecoins such as Tether, but the cardhouse likely won’t fall until there’s a net outflow.

But what if the swift drawdowns, such as the one seen in recent months, turn the tide and people suddenly want to change their crypto for USD? Crypto gains could vanish at a much higher pace than they arrived at. And who will hold the losses here?

Crypto exchanges taking commissions in USD? No. Miners who have continuously supplied the market with their awarded new mints in return for USD? No.

It will be the little man — as always.

Source: https://medium.datadriveninvestor.com/dear-coiners-youve-just-been-musked-3f4a8a3d208b?source=rss——-8—————–cryptocurrency