One of the few publicly-known Bitcoin whales in existence is outlining three scenarios that could cause Bitcoin to suffer a major downturn.
The pseudonymous whale Joe007, who is known for placing large bets on the crypto exchange Bitfinex, says he expects many early investors to pull out once the price of BTC is “high enough.”
He also warns Bitcoin is not immune from a global market reversal similar to the one that happened early this year, which briefly caused BTC to plunge from about $9,100 to about $4,000.
“Macro market meltdown is one possibility, and ‘crypto’ won’t be any more immune than in March.
Also, once BTC price is high enough, holders are going to cash out en masse, leading to a sudden balance shift that precipitates a parabolic curve blow-off. It’s all about timing.
The whale also points to potential sales from investors who are expected to one day receive BTC that was frozen in the collapse of the crypto exchange Mt. Gox.
“Bad news is usually ignored in bull part of the cycle. Only a real shift in demand/supply balance matters.
Mt. Gox ‘thing’ may have real impact once these 160K BTC are actually released into the hands of long-suffering Gox clients. Which definitely won’t happen tomorrow.”
The whale says Bitcoin investors both small and large still need to prove they are willing to buy at Bitcoin’s current levels.
“If YOU aren’t ready to buy at ATH, why would you expect institutions to do it? Come on, show some conviction, lead by example. Maybe others will follow.”
As for the altcoin market, the whale says he doesn’t think it’s a given that altcoins will continue to rally in Bitcoin’s wake. He points to the altcoin market cap’s size of about $200 billion, and says investors will now have to pour billions of USD into the market to fuel fresh rallies.
“…Proponents [are] gonna tell you once BTC falls, alt season begins. Which I think is total bullshit, personally. In the next bear phase I expect alts to lose a bigger share of their capitalization yet.”Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
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