Bitcoin Has Become A Victim Of Its Own Success
Bitcoin got so popular with institutions and spawned so many scams that’s it’s crashing alongside them
Bitcoin was supposed to be a rebellion against traditional finance, but now it’s another asset class. It was supposed to cutout bankers and middlemen, but it’s just created new ones. It was supposed to be a fuck you to central bankers, but now it’s tethered to interest rates like everybody else.
In everything it set out to do, Bitcoin has been a failure, but it’s somehow been a success. They made money and that excuses everything else. But now the money is running out and the excuses are wearing thin. People went along with all the bullshit as long as it made money, but now it’s starting to smell.
Bitcoin is crashing faster than the investments it was supposed to hedge against. Bitcoin has spawned new financial crooks that are destabilizing it and everything else. In these two big ways, BitCoin has become a victim of its own success.
Bitcoin was supposed to be an escape from financial institutions. The first line of Satoshi Nakamoto’s white paper announces Bitcoin as:
A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.
Basically none of this happened. Bitcoin is not used as cash for payments, it’s hoarded as an asset, and most of that speculation is through institutions.
Institutional investors have gone from accounting for 20% of Bitcoin trading in 2018 to 70–80% in 2021. This has been a blessing for Bitcoin’s respectability, but respectability was what they were rebelling against! All of their power came from the dork side of the force, and they’ve gone to the dark side.
First of Morgan Stanley has a lead cryptocurrency analyst now, and this is what she (Sheena Shah) says:
In 2018, retail investors [individuals, ie ‘peers’] were…