Hi, I don't believe your premise of the irrationality of investors and your theory that institutional investors are ready to jump in any day now when markets finally bottom. I do not believe that either is the case. You may be right and I may be wrong though. I am willing to admit that. But I will try to explain my thoughts.
Institutional investors are professionals. They do not invest as a hobby. It is their jobs and they know what they are doing. They understand the market cycle. They understand the implications of a parabolic run and then a climatic peak and they can see one a mile away. They get out before the bubble pops when mania besets a market. They mostly got out at on the bull run to $17K in early December. You can see this in the volume of coins traded. We had big volume on that run. Who do you think was selling out? All the news stories were around were saying that bitcoin was going to $100,000 or even a million. Who was not taken in by these crazy stories? The institutional investors. They sold out into the mania that was last December. I do not think that they are coming back for a long time.
Retail investors are acting rationally. We have been exiting since the blow-of top at bitcoin $20K. When a building is on fire, the last people to leave are the ones who get burnt. Some people can afford to hold on, for what may be years, until they get their money back. Most people are not so fortunate. I know that I am not.
Almost everyone in crypto is in here to make money. Let's be honest. But people can see that there are difficulties ahead. The easy money days are gone. That's not the market that we are in now.
What happens to prices if tether and bitfinex fall? They will go off a cliff.
What happens to crypto prices if the stock market crashes and we enter a new recession? They will go off a cliff.
What happens when people realise that 95% of altcoins are garbage? The market will go off a cliff.
What happens (in the short term) if governments seriously regulate crypo? The market will go off a cliff.
But hey, there's the lightning network to look forward to... :)
I believe that bitcoin in 6-8 weeks could be $12K. It's possible. I also believe that in the same time span, bitcoin could be $4K. So that's plus or minus $4K. Am I going to put my money into bitcoin? Of course not. I would get the same odds right now taking my money to the casino and betting it all in red. That's not a rational thing to do with hard saved/hard worked for money. The market understands this position and has done since bitcoin $20K. What is happening is a great unwinding of the market.
But who knows what the future holds. This is just my guess. You might be right. Fingers crossed for you. I hope that it all goes well for you.
institutional investors are professionals. Thats why that guy the guy above linked put 7 million dollars into bitcoin when it was 700$. he also agrees with the other institutional investor that i linked who believes that bitcoin has a chance to be worth all of the world's fiat. Youre right, institutional investors are here to make money and they are educated. They have been educated about bitcoin and so they see it as money. It's value for now, and in my opinion, for decades to come, is volatile. Institutional investors will take advantage of this so that if bitcoin among all the other crypto currencies that are here now or are to come, becomes the world's international currency, they will have obtained each satoshi for as cheap as possible. They have programmed bots to watch the market and have individuals constantly looking at news entering new information as it becomes available. You might want to pretend that this market is 100% like gambling because the odds are low for any of these coins to be THE coin that becomes the world international currency (a coin almost certainly will) but in the short term (<5 years) it is easy to select which coin is most likely to become the world's international currency (<5% chance in the long term no matter which one you think it is).
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I appreciate your definite views :) They are interesting to read :)
I would think that greater than 95% of people put money in crypto to make money. We all want to make money. But wanting it doesn't make it happen. Putting savings into the market in the blind hope that the market will rise is gambling. This works in a bull market and people think that they know what they are doing. Buying the dips and holding works when the market is going up. Buying the dips and holding is a terrible strategy when in a bear market. It will kill a portfolio. It will grind it down to nothing. People need to be extremely vigilant and careful in a bear market. They need to protect their capital.
I agree with you that long term bitcoin (or something else) may possibly be even bigger than now. That could be months away or that could be years away. Nobody knows.
Be careful my friend and good luck with whatever strategy you employ
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