The big problem of small and highly popular markets is that they can be handled quite easily. Well, an investor with enough money to decide to buy or sell, can generate a trend that other traders follow. Therefore, sometimes in the crypto world it is difficult to differentiate between natural and speculative growth. Something that reminds an enemy of Bitcoin, Peter Schiff, in today’s Tweet:
Bitcoin recovery: Truth or speculation?
Since the first days of the year 2020, Bitcoin has generated worldwide news due to its price. Well, since the start of the year, BTC has been involved in one of the biggest bullish rallies of recent times. Initially positioning the price of the cryptocurrency around $ 10,000. Before falling later this month below $ 9,000.
However, in recent days the cryptocurrency has undergone a recovery process in its price, which has allowed its price to go from $ 8,548 per BTC to which it fell, to $ 9,119 in which it is currently quoted. A substantial increase, which has been immediately interpreted by analysts as a restart in the January bull rally.
This positive outlook, however, could have generated excessive optimism within the crypto world. Well, while Bitcoin had a warm recovery today of 1.81%, the market for future Bitcoin contracts, reflected by the GBTC index, increased 8.86%. What has been considered by Schiff as a product of mere financial speculation:
“I hope spring is eternal among Bitcoin speculators. Now the GBTC has gone up 9% on the day, but Bitcoin itself has only gone up 3%. If speculators do not get the moon shot they expect soon, we can expect the actions of the GBTC to fall back to earth!”Says Schiff in his tweet.
If Schiff’s vision were true, the crypto market would have overreacted too much to the lukewarm increase in Bitcoin. A trend that Peter is convinced will end very soon, causing the price of Bitcoin to collapse, and with it the GBTC indices.