Where is all this cash going? If stock is down, crypto is down. Where is all cash?
It's in cash.
Bitcoin and cryptocurrency prices have fallen sharply over the last few days
21–30 of 259 posts
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#22It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…
bitcoin is not really "there" the same way as gold is.
The whole point of gold is that it is a tangible asset. You can hold gold in your pocket or under your mattress and it costs nothing to store it. You can't prove you have bitcoin if you don't have internet access for example. You can't have bitcoin if miners don't run their nodes. Basically, you are depending on a resource in faraway lands to let you "own" what you have. What kind of asset is that?
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#23It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…
bitcoin is not really "there" the same way as gold is. The whole point of gold is that it is a tangible asset. You can hold gold in your pocket or under your mattress and it costs nothing to store it. You can't prove you have bitcoin if you don't have internet access for example. You can't have bitcoin if miners don't run their nodes. Basically, you are depending on a resource in faraway lands to let you "own" what y…
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Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#24I have to say, the crypto market's strong ties to traditional finance in this crash surprise me. I understand selling off stock because of expected corporate losses, I don't understand mass conversions to FIAT especially when "print more money" seems to be the fed's response to this.
because bitcoin is not money, it is an asset, it is a property that can be traded for money but its value fluctuates and is not tied to anything other than people's perceived future value in it (which can be valuable, don't get me wrong there, all I am saying that it will change all the time)
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#25It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…
Why is cash king?
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#26Where is all this cash going? If stock is down, crypto is down. Where is all cash?
does not need to go anywhere, cash is a form of storage
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#27It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…
Why is cash king?
Assets and long term-investments mean nothing during a crisis, so short-term value stores becomes a much higher priority (currency).
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#28It's a common misconception that Bitcoin is a safe haven. It's not. Not even Gold is a safe haven during a liquidity crisis. In sharp downturns, cash is king. Think of Bitcoin and Gold as call options on the entire global monetary system. If Govs become insolvent, Bitcoin and Gold is there. If the masses lose faith in central banks, Bitcoin and Gold is there. If central banks debase currencies too quickly, Bitcoin an…
Why is cash king?
Its value is not suddenly dropping as the same rate as the other investments. You can (hopefully) buy food with it.
(But being good to your family, having low or no debt and some prudent food storage are also wise, among other things our church has counseled us for a long time). (Edit: and savings "for a rainy day".)
(Edit: This is considering the definition of "cash" to be not just paper in your hand, but as a regulated currency whether paper or in a bank. Further clarification in another reply just below.)
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#29I have to say, the crypto market's strong ties to traditional finance in this crash surprise me. I understand selling off stock because of expected corporate losses, I don't understand mass conversions to FIAT especially when "print more money" seems to be the fed's response to this.
My take on the selloff is people looking for liquid cash. Very similar to stockpiling home supplies. People are looking for stuff they can use or trade in the very short term because they don't know how bad it would get. It's a lot harder to do that today with crypto. I haven't seen anyone with strong reason to believe that companies are gonna be that much worse off a year from now than they were a month ago, or for…
Exactly. It's like here in Florida, when the systems go down after a hurricane, cash is king in the digital age.
Re: Bitcoin and cryptocurrency prices have fallen sharply over the last few days
#30I have to say, the crypto market's strong ties to traditional finance in this crash surprise me. I understand selling off stock because of expected corporate losses, I don't understand mass conversions to FIAT especially when "print more money" seems to be the fed's response to this.
I have a hypothesis that Bitcoin post-2018 is largely held by a handful of major banks as a way to sidestep anti money laundering rules. It's widely known (and proven in court) that the major banks routinely serve billionaire-class criminals (real criminals like drug cartels and terror groups) and large crypto holdings and prop trading operations allow them to move money on and off their books with relative ease.
A slowdown in money laundering activity (as would be expected during an extended period of restriction of goods and services) would lead to a rapid drop in crypto prices.