So yesterday there was the news that Bitfinex (one of the largest BTC exchanges) got hacked and it seems that almost 120K BTC were stolen. Details are still emerging but the Bitcoin price started falling almost immediately on the news. It has since recovered somewhat (Kraken Chart shown above).
As a result of this I have bought a couple of bitcoins worth of STEEM to raise my SP from just over 1000 to now just over 2000. I know some people will think that is tiny amount but for me it represents a lot of money. My reasoning is:
- The current turmoil will persist for some time as more information emerges about the Bitfinex hack.
- There will be an extra 120,ooo (roughly) bitcoins that the hacker will be trying to sell and we don't know if they will try to do that fast or slow.
- These (above) 2 points will continue to put downward pressure on the BTC price for the foreseeable future.
- By the time the current crisis dies down I should be able to cash out BTC from other ICOs and investments.
- There will potentially be a greater flow of money/BTC into alts as a potential hedge against falling BTC value.
- As alts go STEEM has performed really well lately and as I have stated before it is the ONLY altcoin that has a potentially MASSIVE real world use in the form of STEEMIT so it is likely to perform better than many others.
- By powering up my STEEM into SP I can both increase my voting power (if only a little) and protect against the built in 0.19% STEEM inflation.
As always there are no guarantees in the crypto-world. I did what I thought was appropriate for me because I think it is the best course of action at the present time.
I suspect I won't be the only one thinking this way.
Not bad idea.
Yesterday was a terrible day for all the crypto community.
By the way yesterday's steem growth was possible due to the fact that the hacker bought steem with stollen BTC.
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Maybe or it may just be lots of people seeing it as a safe place to put their money during the crisis. For all we know there could be another one (hack) tomorrow. Seems to be crisis after crisis these days.
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That's a spot on assessment as far as I'm concerned and I think there will be a large dump that the hacker can use to re-enter a large position and then unload again slower thereby doubling or nearly doubling his take. In fact, I think the cycle could persist which is good for traders, but terrible for those imagining a stable/ever rising BTC valuation.
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You may well be right. Thing is everybody was expecting plain sailing after the halving. Seems it never really happens in crypto.
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I wish I had some extra fiat laying around I would do the same thing, as it stands I'm just mining some alts and converting to boost my SP!
Good luck !
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Yes I saw your post. That's a good strategy. I think we all wish we had some extra fiat lying around. I'd buy even more steem if I did.
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Honestly, I keep very little BTC around. It's basically a transitional currency. The reason is that there are so many interesting altcoins that I keep wanting to buy, some of them are very good. Check out DMD (Diamond coin) too, for the sake of diversification LOL. I've been buying that one for almost a year and am very happy with it as a long term investment. I'm really liking Steem too, but I'm still very new to the Steem scene. But also, major hacking of trade exchanges followed by an epic dump of Bitcoin (interspersed by the occasional government confiscation of large amounts from say Silk Road) is such a regular thing that you can count on the Bitcoin price crashing big time at least once every three months. Based on Murphy's Law, that would happen right when I need the money. So... Bitcoins are a great way to get from one altcoin to another, or from crypto to fiat, but not something I want to keep a lot of around for too long.
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I tend to go back and forth on it. Sometimes I have a a few bitcoins as a hedge but a lot of the time I also get tempted to put it into altcoins or ICOs. The continuing arguments on block size and scaling also tend to put me off on holding BTCs whenever they happen.
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Ah yes, block size. I'd forgotten that. In my limited experience ICOs are rarely a good buy. Price tends to drop as soon as the asset hits the open market so you can pick up for a better price post ICO. One exception for me was buying a stake in NEM early on.
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You have to choose carefully but even then with what has happened lately I would agree that they are not a good bet anymore.
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Thanks.
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the bitcoin price was already falling before the news of the hack surfaced
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The conspiracy theorists were saying it was the actual coins from the theft being sold off before the news was announced.
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upvote
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Thank you:)
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