Oct 23, · In this study, we show that Bitcoin traders act just as irrationally as traders in other, more established markets. Per-year view of the number . Jun 04, · According to a recent research paper, one that assessed the profitability of mining farms, owners of Bitcoin mining operations and Bitcoin miners in general, tend to be irrational when it comes to managing their operations and with regard to Bitcoin’s price natur-holzbausteine.de: Chayanika Deka. Dec 31, · One of the most baffling things about the irrational exuberance for bitcoin these days is how short people’s memories are. Just three years ago, bitcoin Author: Wayne Duggan.
Bitcoin irrationalBitcoin's Biggest Problem: Its Value Will Never Change | InvestorPlace
But I have news for you: Bitcoin investors probably aren't rational, despite their excellent year-to-date gains. It's tough enough trying to gather a rational thesis to support bitcoin's current valuation, but a recently released survey from LendEDU, an online marketplace for student loan refinancing, shows just how out of touch with reality most bitcoin investors are.
LendEDU asked American adults from across the country the following question:. However, the survey was actually conducted between Nov. Here are a number of reasons why the wheels on this bus could be ready to fall off.
To begin with, retail investors, who are prone to investing with their emotions on their sleeves, have primarily been in control of the price movement in bitcoin and other cryptocurrencies throughout Institutional investors have mostly been keeping their distance because of the unregulated and highly volatile nature of cryptocurrency markets and exchanges. But that's changing a bit as we head into On Dec. Aside from providing a means to boost revenue for CBOE, CME, and Nasdaq, futures trading offers the first real opportunity for institutional investors to bet against bitcoin.
Prior to this, buying and selling was the only viable option, with no real way to bet against a cryptocurrency and make money if it fell. These ETFs would track the movement in bitcoin futures contracts rather than bitcoin itself, but it would presumably make it worlds easier for institutional investors and skeptics to place their bets against bitcoin.
Long story short, skeptics are going to have a much easier path to exert their influence on bitcoin next year, which I suspect could stop this rally in its tracks.
There's also the potential that government regulation could be an impediment to bitcoin in Though it received a boost from Japan, which accepted the virtual coin as legal tender this year, cryptocurrencies and bitcoin could just as easily be banned by other countries. In October, Russian President Vladimir Putin condemned bitcoin, and suggested a ban on all cryptocurrencies. This would be a blow to bitcoin, which already saw domestic cryptocurrency exchanges shut down in China.
We should also take into account just how bad Wall Street and retail investors are at correctly predicting the uptake of new technology. The emergence of cryptocurrencies is all about replacing cash purchases with virtual currencies and the rise of blockchain technology , which is the digital and decentralized ledger that underlies most cryptocurrencies and records all transactions.
Retail investors have priced bitcoin and other cryptos as if enterprises will open their arms and implement blockchain immediately. Yet blockchain has been around for years, and only now is getting tested in small-scale and pilot projects. While this could be a game-changing technology, it's also going to take time to be integrated into the financial-services and technology industries.
That could prove to be a major letdown for investors in History has shown that emotions can only carry an asset so far, and could prove to be a reality check for bitcoin and cryptocurrency investors. Investing Bitcoin is certainly presenting investors with an unprecedented opportunity to capture what I like to call irrational profits.
Just over three months ago I wrote that my indicators were Bullish on Bitcoin. It did so less than one week later. I, for one, am more than happy to accept them thank you very much. Our first chart of the day is a very long-term chart of the price of bitcoin together with a history of the TradeStops VQ on bitcoin. You can also see in the chart above that bitcoin has dipped into the SSI Yellow Zone about 7 times since then.
The last time bitcoin dipped into the SSI Yellow Zone and rose out again was in September … when we made our call to buy it. But given that the time-cycle forecast is working so well and my profits in bitcoin have gone parabolic, I am looking for the right time to take some money off the table. Dipping your toes in the water is fun.