I hope my thread can help newbies in crypto market.
People are talking too much about investments from Square, and Micro Strategy or hacks. Do you actually spend time to investigate news, figures inside, potential effects on market?
News from newsletters, articles, blogs, social media need to be verified quantitatively. If you don't play with figures and verify news you read, you only eat up words are written and manipulated by the others. It is root cause from which news are created for.
People mainly eat up words from news, and spread around. Repeat what they read and eat and don't spend time to verify, and assess news.
Do quantitatively research. You can not have capability to scrape data, run analyses but at least need to have intention to do this, then try to investigate. You will feel it is challenging but believe me "The more times you do it, the better competency you will achieve".
In short, what to do?
- Raise your questions on validity of figures are presented in news and potential effects.
- Try to find data (from some third-parties or from your own side)
- Reproduce analysis and make comparison if possible
Quality of your investigation will depend on
- Methodology
- Quality of initial data sources
- Skills to clean data before analyse it
- Statistical analysis skills
Many factors but first 2 points are most important because "Garbage in, garbage out".
Fortunately, if you have good attitude, you can improve your knowledge, skills and quality of your investigations.
“In God we trust; all others must bring data.”
W. Edwards Deming
I fear not the man who has practiced 10,000 kicks once, but I fear the man who has practiced one kick 10,000 times.
Bruce Lee
There are two types of news readers:
- Read to get information and don't mind to verify correctness of news
- Read to get information, then verify it with their own investigation (with quantitative data) and withdraw their own conclusions
The table shows investments from Square and Micro Strategy accounts for:
- 0.025 % and 0.116 %, respectively in terms of total circulating supply.
- 0.218 % and 0.991 %, respectively in terms of total 24h trading volume
- Too small attributed percents from 2 companies
If you move further by use deduction for potential lost bitcoin (from 2
+-year inactive addresses. It is about 21.66% (in March 2020) of circulating supply or ~ 4010329 BTC (I used 21.66% and today circulating supply to estimate lost BTC).
The % of Square and Micro Strategy investments will account for 0.032 % and 0.148 % of assumed real circulating supply ~ 14504577 BTC. They are still very small figures.
. di 18514906-4010329
14504577
. di 4709/14504577*100
.03246561
. di 21454/14504577*100
.14791193
In capital flow, those investments don't make any sense for bitcoin. Fortunately, with news spread widely by Internet, social media, and bitcoiners, they resulted in positively effects in mentality aspect. Then, in turn reflect on price (somewhat). It is good but when things are good, you need to look at it and be woke!
In opposite situation, if bad news are released with same amount of investments, hacks, etc. you should be calmed down because of very low proportions in terms of total daily volume, and circulating supply of bitcoin.
HacksLike this news:
150,000 Bitcoin Coming Back to Mt. Gox Creditors in 10 Days; Will BTC Price Drop?How big / small the amount is?
Please look at total exchange inflow (average). I am not able to get full data from that site so I can not give you correct average statistic but the chart shows the average would be somewhere around 50k BTC per day. By that I meant 150k BTC will take around 3 days of total exchange inflow. Not significantly big.
Remember it is inflow (in average) not total 24h trading volume on all exchanges (~2164762 BTC). It is about 6.9% of 24h trading volume (as of writing).
It has not yet consider how many receivers still been alive and still be able to receive those 150 000 BTC. Another assumption is the rehabilitation will actually happen.
Lots of
IF.
Sources
