Bitcoin Exploded: What Now?

A few days ago I wrote about bitcoin (BTC), which was in the middle of a classic crash. I gave several reasons why not to sell even though it looked like BTC was going down to $6,000.

One was: “Firstly, a change in the global situation could dramatically change the picture.”

That is what we got on October 25, 2019 – Xi Jinping, the Chinese president, used blockchain technology as an example of where China should focus on new technology as part of its economic progress. That is the accepted reason why BTC went from $7,500 to $10,500 in a few hours. The read through from blockchain to BTC is not a big leap of imagination and enough to have a lot of capital pile back into Bitcoin.

China is the driver of BTC or what they used to call the ‘Ax,’ the player that sets the pace. So when their President says ‘blockchain is good’ it’s a massive boost, especially when the Chinese state has been pushing back against crypto because of its ability to send Chinese funds abroad with the click of a mouse.

Meanwhile if China is going all in for crypto, where does that leave the ‘Libra phobic’ US quailing at the thought of Facebook eviscerating the dollar? Facebook is a big deal, but China is a bigger deal. The US will have to think about a 180 degree policy U-turn on Libra, if China is coming to town with crypto. The Europeans will have to get their game on too. With this potential BTC sits in the centre, the Nobel of this cyberwar.

This all sounds sizzly for crypto but forgetting all the jazzy narrative, what is an investor to do?

The investment first rule of this situation must be “Up like a rocket, down like a rock.”

I’m not saying that bitcoin will slump back, but this is what you should write in biro on your palm of your hand for quick reference when you get confused about the market tomorrow or next week and you need solid ground to brace yourself against as things get spicy.

BTC is…

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