Jerome Powell spread some FUD yesterday... From his point of view and the institution he heads, he probably stated some facts and predictions, but the crypto market interpreted them as FUD...
What do you mean... the Fed "is not allowed to own bitcoin"? What a piece of FUD, right? Well, not really, it's called the law. If one doesn't like it, one needs to change it. The question is... is bitcoin is a subject so important that someone with a say would want to change the Federal Reserve Act for it?
What I'd be curious about is if Trump knew it would come to this, or if he is taken by surprise by this roadblock. I don't think he was taken by surprise. Now... he appointed some crypto-friendly people in his future administration, so maybe he is genuinely pro-crypto. The question is what now? Is the idea of bitcoin as a strategic reserve in the US dead for the time being or not?
To be a match for gold, bitcoiners surely covet for the status of strategic reserve in the US for BTC. If this is going to happen or not, it will be a long process, not something Trump could sign and make happen the day or week he comes into office. And we know how anxious people in the crypto space are... 😀
That's probably why we saw that knee-jerk reaction in the market yesterday. Ok, let's say people were disappointed in bitcoin's regard and sold. But how was this in any way justified for the alts? None of them were going after the strategic reserve status and lost nothing. Was the market expecting the Fed to keep cutting rates like crazy next year? I wasn't!
That's where the irrationality of the market comes in and where probably the dreadful hyper-leveraging instruments that enough people use in crypto so loosely and mindlessly and amplify dips through liquidations.
Either way, I took the chance last night and bought a few more alts as they were bleeding hard. Unfortunately, I didn't have any more liquid HBD to buy more HIVE at that time.
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