By Tofiq Aliyev
On Nov 28, 2020
Bitcoin (BTC) has faced an extremely strong correction since it peaked at around $ 19,500. In recent days, the price has dropped more than $ 3,000. Over 15% has been removed from the price tag. Regarding the current situation of Bitcoin, Morgan Creek CEO Mark Yusko claimed that investors focus on value, but speculators focus on price.
After soaring to an all-time high of nearly $ 20,000, everyone focused on the possibility that Bitcoin would break a new record. But the sharp drop came unexpectedly. Bitcoin investors, analysts, and bitcoin bashers have all defended several opinions about the current situation. The leading cryptocurrency is even traded below $17,000 after a heavy correction on Thursday. Despite the current drops, it is believed that the leading cryptocurrency is in an undeniable bull market. In daily time frames, technical indicators such as the RSI hit the oversold conditions on record and jumped into a bull market in the weekly time frame.
Mark Yusko, chief investment officer, and general manager of Morgan Creek Capital Management commented on the current situation. He claimed that “investors drive long term value, speculators drive current price.” He said the motivation and time horizon for adopting Bitcoin determine whether investors are successful in this new asset class. In a Twitter thread about the recent wave of negative headlines, Yusko said that financial institutions are concerned about the impact of Bitcoin. So, they use all ways to slow the adoption of bitcoin. He continued that, consequently, this has been a lost strategy for centuries.
“When threatened, incumbents always turn to influence of governments to try and slow adoption of new technology through onerous regulation.”
Lately, unfavorable news has hit the market. China has seized more than $4.2 billion worth of crypto assets in its clampdown against the Plustoken Ponzi scheme. Then, Coinbase CEO Brian Armstrong has predicted concerning speculation about the US government proposing strict crypto wallet regulations. In the meantime, by reacting to headlines, speculators seeking short-term exposure will continue to influence Bitcoin price. However, Mark Yusko believes that investors with a longer time horizon are more likely to succeed as Bitcoin’s fundamental narrative strengthens:
“Investors are long-term holders focused on Value & Speculators are short-term holders focused on Price.”
Bitcoin holders are known for their low timing preferences. They are putting aside instant gratification for long-term gain. In this case, the “long-term benefit” is a paradigm shift in the way society understands money.
Right now, the views are that it is too early to talk about a bear market. At the time of writing, Bitcoin is trading around $ 17,208. According to CoinMarketCap, the leading cryptocurrency has raised 2.69% in the past 24 hours.
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