Are institutions hedging?

[oHnK]

Hence I think they are here to stay and they will hold their bitcoins as long as they have to, not like they are people who need money so they will just hold it forever and would be fine with it.

I hope that's true and it's not just a price game. Because with large companies that support Bitcoin and settle not to sell short, this is a very real Bitcoin triumph. But if not, then this really destroys the market. Their ability with large amounts of funds is very influential for price stability in the market. Any sensitive issue, even if the truth is not accurate, can make the market panic.

[bits4books]

Hiding from the crisis in cryptocurrencies is a pretty stupid idea. And not even because during the crisis in recent years, there is a tendency to print money to get out of this crisis, which leads to inflation - but because during the crisis, cryptocurrencies fall in price and/or stop their growth, just like the regular stock market. You think that cryptocurrency is a safe bunker during a crisis, but in fact it is just as much a bungalow made of straw as fiat currencies. What difference does it make how much money you have if the real purchase power doesn't depend on it?

The difference is that on a regular day crypto still keeps going whereas money keeps losing its value. For example, if you had 1 million dollars at the start of 2020 and you had 1 million dollars worth of bitcoin at the start of the year, that 1 million dollars in cash couldn't even buy you the same things, why? Because inflation made things more expensive, but that 1 million in bitcoin would have been 7 million dollars or so right now and could have bought anything you wanted and then some.

Long story short sure during the march fall just like how markets dipped, oils dipped, gold dipped, during that period bitcoin dipped as well I get that, but this is cash versus bitcoin and bitcoin wins every single time, if you want to go with stocks go ahead who can stop you, maybe you will find a stock that is more profitable, but bitcoin is a currency and it is a better currency than dollars or any other ones.

The purpose of money and the purpose of BTC are two different things.
"The purpose of BTC" is a conditional eternal growth, which to one degree or another is one of the motives for inflation, because in relation to the dollar it is indecently expensive (hello 51k). It's growth for growth's sake.
And the purpose of money is an opportunity here and now buy anything without unnecessary stages to buy/sell something and at the same time instantly. I'm not talking about the fact that buying a conditional property today, you thereby bring money into a state of "eternal growth" - until you decide to sell this property (I don't know about your country, but in my prices for real estates only grow).

The main problem is that BTC does not create anything but even more dollars, thereby motivating inflation, when the dollar itself does not do this

[TheUltraElite]

Huge corporations that invest in crypto are seemed did it to show everyone that they believe in crypto and are ready to use it. Moreover their deeds made crypto more popular and intrigued a lot of newbies that started actively to buy crypto on “high” to jump onto the last carriage of the departing train.

It is called pure FOMO. This growth is inorganic like I said in previous post and not going to sustain for long. Dont get me wrong, I am bitcoin bull but this type of stupid bullishness is not my thing, I am rather disappointed by the amount of FOMO currently in the market and although happy that Bitcoin crossed 51k USD with this, it wont hold for long.

Companies like these use Bitcoin as a soft target for manipulation - even if they did say that they bought bitcoin, they will not tell you when they sell it - heck if they did how will they make the profit which is their intention from the first place. They see the untapped potential in such niche groups and therefore redpill them into going the way they want, sadly.

Yes these companies are hedging, moving to new asset classes that have shown resilience and growth in the last decade and therefore common crypto users need to be aware of the manipulation that is going to follow.

[bits4books]

This is normal marketing and nothing more. An attempt to attract a new audience to your products by getting closer to this audience through their hobbies and interests.
If tomorrow everyone suddenly starts cutting down all the trees on the planet-then the corporations will immediately connect and show that " hey, we are the same as you buy from us!" "it always is.
I don't think there's any hidden meaning here, it's just an extension of your own audience.

[Silberman]

There is no doubt in my mind that institutional investors are a great part of the growth that we had been seeing during the last months, institutional investors for the most part would have not come to this market if they did not thought that this market had great potential.

Another reason could be that they are looking for a way to make a profit in a relatively short time by buying low and selling at the top. Isn't it quite boring nowadays to play in the world of stocks, gold, or forex? so the bad possibility is that they are just bored with other instruments so they choose Crypto. But this is just bad thinking, we still have to be positive that this is the glory of Bitcoin.

We cannot discard any possibility, however at the same time such a move would be risky don’t you think? The few institutional investors that we have seen have invested important sums of money in the market, if they actually tried to sell their coins now to get their short term profits there is a very strong possibility they will crash the market and who knows if they will realize their goal of making some short term profits, it seems a better and safer plan could be to remain invested in this market as it keeps growing and only sell once the market is even more robust than what it is today, that seems like a better strategy and it seems it is the one they are actually using.

[tygeade]

It is called pure FOMO. This growth is inorganic like I said in previous post and not going to sustain for long. Dont get me wrong, I am bitcoin bull but this type of stupid bullishness is not my thing, I am rather disappointed by the amount of FOMO currently in the market and although happy that Bitcoin crossed 51k USD with this, it wont hold for long.

Companies like these use Bitcoin as a soft target for manipulation - even if they did say that they bought bitcoin, they will not tell you when they sell it - heck if they did how will they make the profit which is their intention from the first place. They see the untapped potential in such niche groups and therefore redpill them into going the way they want, sadly.

Yes these companies are hedging, moving to new asset classes that have shown resilience and growth in the last decade and therefore common crypto users need to be aware of the manipulation that is going to follow.

We can't really call it FOMO neither, and I am not saying it is a sustainable increase, it of course is not, but it is not FOMO neither, it is like a weird new situation that doesn't really have a name yet.

What is going on right now is the fact that it is not FOMO because people are not going in like crazy due to price going up, it is the huge companies going in because they want to diversify their portfolio and crypto is big enough to cover their investments now, back in the day putting 10 billion dollars into bitcoin would be suicide for them whereas doing it right now is not a problem anymore, so what is going on right now is bitcoin opening up to a whole new market of people and that is the reason why it is going up so far. Could it fall like crazy?

Well yeah, if those companies stop buying, and even start selling, that would make it go down like crazy, could it keep going up for a while longer? Sure that could as well if companies keep buying up. I do not know what is going to happen because we never saw anything like this before.

[FanEagle]

We cannot discard any possibility, however at the same time such a move would be risky don’t you think? The few institutional investors that we have seen have invested important sums of money in the market, if they actually tried to sell their coins now to get their short term profits there is a very strong possibility they will crash the market and who knows if they will realize their goal of making some short term profits, it seems a better and safer plan could be to remain invested in this market as it keeps growing and only sell once the market is even more robust than what it is today, that seems like a better strategy and it seems it is the one they are actually using.

I think it is not about actually selling for them, they do not have to sell their coins to show profit, these are the same companies that say "we are in 15 billion profit this quarter" while not selling any stocks neither, so I doubt they would need to sell their bitcoin position to say they are in profit.

Moreover, if I buy bitcoin at 1 dollar, and it is 50 thousand dollars, as long as I do not spend it or cash it out, it is just there as 1 bitcoin and I can't really do anything about it, it is not going to change anything for me, in order for my life to change I have to sell that and get fiat instead (or spend bitcoins). These huge places do not need that, they could show profit on accounting stats and that is good enough for them, they are not after anything else, as long as they can tell shareholders they are richer, it is more than enough for them.

[justdimin]

I think it is not about actually selling for them, they do not have to sell their coins to show profit, these are the same companies that say "we are in 15 billion profit this quarter" while not selling any stocks neither, so I doubt they would need to sell their bitcoin position to say they are in profit.

Moreover, if I buy bitcoin at 1 dollar, and it is 50 thousand dollars, as long as I do not spend it or cash it out, it is just there as 1 bitcoin and I can't really do anything about it, it is not going to change anything for me, in order for my life to change I have to sell that and get fiat instead (or spend bitcoins). These huge places do not need that, they could show profit on accounting stats and that is good enough for them, they are not after anything else, as long as they can tell shareholders they are richer, it is more than enough for them.

They would still have to sell to get into something else though? I mean yeah they do not have to sell to show profit, they do that with stocks all the time, they just own a lot of stocks and when it goes up they say they are in profit even without selling the said stock and when it goes down they say they are in a loss without selling as well, it is like impossible to actually make them sell in that situation.

However they do end up selling their stocks time to time as well, not like they just buy one stock and keep it forever (well they do that sometimes too) so there is a chance they could still sell for a reason, maybe they found a great situation and they want to get in on it and need money, easiest would be is to sell their coins and honestly that would be the first thing they end up selling as well. Long story short they do not "have to" but they may want to.

[Silberman]

We cannot discard any possibility, however at the same time such a move would be risky don’t you think? The few institutional investors that we have seen have invested important sums of money in the market, if they actually tried to sell their coins now to get their short term profits there is a very strong possibility they will crash the market and who knows if they will realize their goal of making some short term profits, it seems a better and safer plan could be to remain invested in this market as it keeps growing and only sell once the market is even more robust than what it is today, that seems like a better strategy and it seems it is the one they are actually using.

I think it is not about actually selling for them, they do not have to sell their coins to show profit, these are the same companies that say "we are in 15 billion profit this quarter" while not selling any stocks neither, so I doubt they would need to sell their bitcoin position to say they are in profit.

Moreover, if I buy bitcoin at 1 dollar, and it is 50 thousand dollars, as long as I do not spend it or cash it out, it is just there as 1 bitcoin and I can't really do anything about it, it is not going to change anything for me, in order for my life to change I have to sell that and get fiat instead (or spend bitcoins). These huge places do not need that, they could show profit on accounting stats and that is good enough for them, they are not after anything else, as long as they can tell shareholders they are richer, it is more than enough for them.

That is interesting and I think you are right, however we cannot discard the possibility that they sell, after all even if a company is being administrated in the right way now that does not mean this is going to continue in the future, if one or several of the different companies that have invested in the market begin to face difficult times they are going to sell some of their best assets and that is when they could begin to sell their bitcoin affecting the market in the process.

[Wind_FURY]

I am currently reading this book, “Dying of Money” written by Jens O. Parsson. It’s an old book, anyone might find a .PDF copy somewhere through a simple Google search.

It’s about how the Weimar Republic lost control of its monetary system, and the description of events, from before, that caused hyperinflation.

READ IT WITH ME.

https://www.amazon.com/Dying-Money-Jens-Parsson/dp/1457502666

The cover motif is a piece of old German money. It is a Reichsbanknote issued on August 22, 1923 for one hundred million marks. Nine years earlier, that many marks would have been about 5 percent of all the German marks in the world, worth 23 million American dollars. On the day it was issued, it was worth about twenty dollars. Three months later, it was worth only a few thousandths of an American cent. The process by which this occurs is known as inflation.

A few years before, in 1920 and 1921, Germany had enjoyed a remarkable prosperity envied by the rest of the world. Prices were steady, business was humming, everyone was working, the stock market was skyrocketing. The Germans were swimming in easy money. Within the year, they were drowning in it. Until it was all over, no one seemed to notice any connection between the earlier false boom and the later inflationary bust.

[dothebeats]

I would say that they are doing this just because they believe bitcoin is worth something more in the future, other than just having its dollar value appreciating over time. You might call it a hedge or whatever, but there's more to buying bitcoin than just profits for them, especially at that quantities that they have been buying from the past few months. Bitcoin is never poised to take on the financial system head on, though it does and can certainly help in retaining some value if the going gets rough for the world's economy.

Who knows what they will do once the FOMO dies out? Not much of them are doing something to change the landscape of cryptocurrency except buying and inflating the value. They might even sell it in a heartbeat once their profit goals are already realized. It's anyone's guess.

[Wind_FURY]

I would say that they are doing this just because they believe bitcoin is worth something more in the future, other than just having its dollar value appreciating over time. You might call it a hedge or whatever, but there's more to buying bitcoin than just profits for them, especially at that quantities that they have been buying from the past few months. Bitcoin is never poised to take on the financial system head on, though it does and can certainly help in retaining some value if the going gets rough for the world's economy.

Who knows what they will do once the FOMO dies out? Not much of them are doing something to change the landscape of cryptocurrency except buying and inflating the value. They might even sell it in a heartbeat once their profit goals are already realized. It's anyone's guess.

A simple question, would you save, and HODL cash, if there was a possibility that your government might lose control of the monetary system because of its own actions done during the COVID-19 pandemic?

Do you believe the United States economy will NEVER be affected by inflation after the trillions prrrinted by the Fed?

[bitgolden]

I am currently reading this book, “Dying of Money” written by Jens O. Parsson. It’s an old book, anyone might find a .PDF copy somewhere through a simple Google search.

It’s about how the Weimar Republic lost control of its monetary system, and the description of events, from before, that caused hyperinflation.

Honestly that was a huge situation and we are not in that big of a trouble even with the pandemic and all the other things we are still doing better than weimer germany because the current monetary situation was basically improved on that. This doesn't mean that it is impossible for us to have a hyperinflation because we do have that in some nations but realize that almost all the time (nearly all the time) if there is a hyperinflation in a nation there is usually a dictator at the top refusing to leave that spot.

I do not remember any nation with hyperinflation that has a decent democracy. I would say even in USA it was possible considering there were elections there and president denied losing, not that I am american so I do not care but those type of things are the real reason.

[Dave1]

Who knows what they will do once the FOMO dies out? Not much of them are doing something to change the landscape of cryptocurrency except buying and inflating the value. They might even sell it in a heartbeat once their profit goals are already realized. It's anyone's guess.

I wouldn't say that they are here to FOMO, obviously, they are into inside bitcoin to hedge their reserve assets. I saw reports that when we hit at the peak around $57k, Tesla's investment grow into billions but I doubt that they have sold. Microstrategy continues to buy so they are not going to sell in a heartbeat just because they have made billions. They are looking long term here, or at least year to year to gauge their investments.

[verita1]

Big investors are protecting their money from inflation with bitcoin. The price of bitcoin could reach 100K this year as has been said repeatedly.
And destroying bitcoin, I don't think that's the goal of the biggest bitcoin holders.

Rather, large institutions are treasuring bitcoin, there are many projects to be executed taking bitcoin as the center of attention. If anyone has not noticed, we are evolving to a new stage of bitcoin that of consolidation and acceptance around the world.

[magneto]

There’s a topic debating that institutions are manipulating the market, and will “destroy Bitcoin”. I have a different narrative.

While it’s great that Elon Musk and other companies are HODLing bitcoin, but don’t you think that there is more into their FOMO, than profit? Are they actually hedging against the current financial system? If the answer is yes, are they expecting an major economic crisis after the COVID-crisis?

To an extent.

I think that it is shallow to say that these large tech corporations are simply speculating. It would be super inconvenient for them to carry these assets on their balance sheets if their sole goal was merely to make a quick buck - just for instance, all the disclosure requirements to shareholders are going to hurt their potential profitability since it makes it easier for markets to anticipate their next moves.

So yes, definitely an element of hedging against a fiat collapse here, even if they don't want to admit it readily in public.

[TheUltraElite]

We can't really call it FOMO neither, and I am not saying it is a sustainable increase, it of course is not, but it is not FOMO neither, it is like a weird new situation that doesn't really have a name yet.

That is a FOMO condition mate. In the FOMO people remain confused as to what the next move on the market will be and how the people who created the FOMO is going to profit from it.

What is going on right now is the fact that it is not FOMO because people are not going in like crazy due to price going up, it is the huge companies going in because they want to diversify their portfolio and crypto is big enough to cover their investments now, back in the day putting 10 billion dollars into bitcoin would be suicide for them whereas doing it right now is not a problem anymore, so what is going on right now is bitcoin opening up to a whole new market of people and that is the reason why it is going up so far. Could it fall like crazy?

It can fall too and checking the current market metrics, price of bitcoin has falled back to <45k $/BTC and this drop is continuing further. Is Musk saying anything about it? No. Because he made the profit when he needed to and now no longer has any other motive. Ask me, I dont trust any celeb promoting anything because they are paid for it, here he is profiting from the people entering the market.

Maybe they do care about the "tech" and all that narrative, but humans in this world know about profit and how to make it.

Well yeah, if those companies stop buying, and even start selling, that would make it go down like crazy, could it keep going up for a while longer? Sure that could as well if companies keep buying up. I do not know what is going to happen because we never saw anything like this before.

We saw a bull rise in the 2017 ICO craze. Only the magnitude is different. What was fine was that Paypal allowing bitcoin transactions - that made some headlines and drove the price up but then this Tesla guy has to jump in the FOMO and make it crazy.

[Wind_FURY]

I am currently reading this book, “Dying of Money” written by Jens O. Parsson. It’s an old book, anyone might find a .PDF copy somewhere through a simple Google search.

It’s about how the Weimar Republic lost control of its monetary system, and the description of events, from before, that caused hyperinflation.

Honestly that was a huge situation and we are not in that big of a trouble even with the pandemic and all the other things we are still doing better than weimer germany because the current monetary situation was basically improved on that. This doesn't mean that it is impossible for us to have a hyperinflation because we do have that in some nations but realize that almost all the time (nearly all the time) if there is a hyperinflation in a nation there is usually a dictator at the top refusing to leave that spot.

I do not remember any nation with hyperinflation that has a decent democracy. I would say even in USA it was possible considering there were elections there and president denied losing, not that I am american so I do not care but those type of things are the real reason.

I’m not directly comparing the current situation to the the Weimar Republic’s situation, BUT the current U.S. GDP is going down, money supply is BRRRRing to go up. Recently, Biden approved a $1.9 trillion COVID-19 stimulus package, just for this year. I believe the book is something to learn from.

[Silberman]

I am currently reading this book, “Dying of Money” written by Jens O. Parsson. It’s an old book, anyone might find a .PDF copy somewhere through a simple Google search.

It’s about how the Weimar Republic lost control of its monetary system, and the description of events, from before, that caused hyperinflation.

READ IT WITH ME.

https://www.amazon.com/Dying-Money-Jens-Parsson/dp/1457502666

The cover motif is a piece of old German money. It is a Reichsbanknote issued on August 22, 1923 for one hundred million marks. Nine years earlier, that many marks would have been about 5 percent of all the German marks in the world, worth 23 million American dollars. On the day it was issued, it was worth about twenty dollars. Three months later, it was worth only a few thousandths of an American cent. The process by which this occurs is known as inflation.

A few years before, in 1920 and 1921, Germany had enjoyed a remarkable prosperity envied by the rest of the world. Prices were steady, business was humming, everyone was working, the stock market was skyrocketing. The Germans were swimming in easy money. Within the year, they were drowning in it. Until it was all over, no one seemed to notice any connection between the earlier false boom and the later inflationary bust.

I have not read that book in particular but I am aware of that particular crisis, what happened was not just the government printing too much money, what happened was that during the first world war the German government printed a lot of money in order to sustain the war effort and most people kept their money just in case they needed it so inflation did not increased it, but once the war is over and people decided to make use of their money they realized it bought a lot less, people panicked and bought everything they could finally reflecting the impact of the monetary polices of the German government on the economy, and this created a vicious cycle in which governments kept printing money and people kept spending it as fast as they could.

[Webetcoins]

There’s a topic debating that institutions are manipulating the market, and will “destroy Bitcoin”. I have a different narrative.

While it’s great that Elon Musk and other companies are HODLing bitcoin, but don’t you think that there is more into their FOMO, than profit? Are they actually hedging against the current financial system? If the answer is yes, are they expecting an major economic crisis after the COVID-crisis?

Well, you can be right, it can be that they are trying to make use of Bitcoin as a hedge due to all the money printing and everything that has happened so far. Then as to why I think a lot of people believe that they are going to destroy the market is because of the way they are buying up every coin in the market and investing hundreds of millions and billions, and then they keep them in a wallet where they are stagnant (let me use that word), then it reduces the number of circulating coins which affects the market, then one day you will wake up and these institutions will start selling their coins and cashing huge amount of money. Imagine Tesla that has invested $1.5 billion and how much profit they will be making in future.

So that’s the problem I think, but I don’t know if I’m right, it’s just what I think is making some people not to like the ideas of institutions being part of this whole thing.