Bitcoin - Too Far, Too Fast?

Authored by Peter Tchir via,

As Bitcoin surges above $9,250 on the open this Sunday, I have to admit to having some real trepidation at these levels.

I have been a proponent of the view that Bitcoin and cryptocurrencies would benefit from the launch of ETFs and futures.  My view is that allowing for easier 'adoption' of Bitcoin will help fuel its growth as it lets new investors participate indirectly.

I should not limit that theory to just more traditional ways to invest, like ETFs and futures, but should also include easier ways to establish wallets and to own Bitcoin (and other cryptocurrencies) the 'traditional' way.  There are a growing number of 'easy' to use guides to getting Bitcoin (I have glanced at many but haven't followed through to verify how well they work of don't work).

I am convinced that ease of access and the potential for more mainstream products linked to Bitcoin has helped fuel its surge.

But now, I am concerned it has gone too far, too fast.

I have three major concerns that could slow the price rise or even cause it to have a significant correction (yes, I am converting from bullish Bitcoin to at best neutral).

Here are the three concerns:

1. Are all the ETF and Futures launches a 'sell the news' event?  Basically the question is, while I believe that easier adoption will lead to inflows, how much of that is priced in?  Have speculators loaded their electronic wallets with Bitcoin hoping to capitalize on the expected gains to the point, there won't be more expected gains?  Understanding when something is 'already' priced in is difficult at the best of times, let alone with something as complex and growing exponentially like Bitcoin, but, I can't help but wonder.  I have felt a switch in discussions I'm having over the last few weeks.  A subtle switch, but one where the Bitcoin bulls seem more eager to name ever higher price targets, while the agnostics seem more willing to do work and think about it more, rather than in a rush to get some money into Bitcoin.  The sort of behavior that may be indicating a 'sell the news' type of environment.


2. There are becoming too many competing investments which are causing some investors to question how 'real' the existing ones are.  Yes, I understand that ICO's aren't necessarily dilutive, if you can purchase them with Bitcoin, but it does start to appear odd when it seems like virtually every day, someone or some entity is announcing some new variation on the theme.


3. Fedcoin, the potential for the Fed could be classified within concern number 2, but is really only part of a larger, separate concern - that governments or central banks will push back.  I read this week, along with a lot of other people, an article describing that Bitcoin was now worth more than McDonald's.  While that sort of article is designed to 'shock' investors, especially more conservative investors, I think it represents a larger, growing concern that the 'establishment' has surrounding cryptocurrencies.  Whether the concerns are more focused on the potential for illegal funds to enter the system, taxation, controlling 'pump and dump' schemes or making your own job more difficult to manage, I'm sensing they are rising to the surface again.  I think we have hit another tipping point where to expect a response to attempt to slow down the growth and valuation of crytpocurrencies should be expected.  Something that has risen almost a 'ten-bagger' in less than a year is bound to attract attention.  Bitcoin rebounded strongly after the China crackdown, so this fear might be over-rated, but a more organized government or central bank crackdown shouldn't come as a surprise to anyone.  The bigger question, in my mind, is whether Bitcoin can withstand that - but that is a question for another day.

I am torn, because my thesis of 'ease of adoption' seems to be playing out and in general it is a long way from being fully played out, which by itself is supportive of greater price appreciation.  But, at the moment, my concerns are winning out and I'd be taking some chips, or bits, as the case may be, off the table.


38BWD22 Stackers Mon, 11/27/2017 - 19:25 Permalink

  Could very well be ($10,000 eventually to $200,000), who knows?  But each time Bitcoin takes a nice price jump, I trim my holdings a bit by buying gold.  By doing that, I have now "paid for" all my remaining BTC, mmm, gravy...Next price level I would probably sell some at would be $10,500 or so.  But, I won't trade much of $10,500 BTC for gold, I plan to keep at least some BTC until it looks like something better will take take it down (which almost surely WILL happen sooner or later).

In reply to by Stackers

Prisoners_dilemna 38BWD22 Mon, 11/27/2017 - 20:18 Permalink

Bitcoin in pictures.  While the first one is overly simple, I agreed with it. The second photo is supposedly accurate as of today.…… Whether Bitcoin ever becomes the worlds reserve currency or not, it appears to have found, and continues to find purchase as money.

In reply to by 38BWD22

Mine Is Bigger Stackers Mon, 11/27/2017 - 20:10 Permalink

In my unqualified opinion, most people seem to overlook the fact that it is super easy to buy a fraction of bitcoin, unlike shares, bonds, etc.Many people are buying $100, $500 worth of bitcoins at a time.To them, whether 1 bitcoin is $8,000 or $10,000 is probaly not so crucial as long as they see their $500 investment going up to $700, so on.

In reply to by Stackers

smallblockchevy350 God Emperor Mon, 11/27/2017 - 19:23 Permalink

Why the FUCK do all you guys care so much about celebrity women? Who cares about a bunch of narcissistic high-maitenance evil bitches? Why the fuck would they care about you?You might as well jerk off to a picture of 1 billion cash, you have a better chance of actually getting the cash one day.I love porn, been looking at porn since I was in 4th grade. But I never gave a fuck about celeb women pics for the same reasons I don't give a fuck about who won last night's pro sports game. THEY don't give a fuck about me so why should I give a fuck about THEM?Besides, there are tons of unknown girls out there who are just as hot but with way better personalities.I'm not against you posting these links, BTW. Keep it up, do whatever you want. I upvoted you. I'm just sharing my worldview.On the other hand, it does feel good knowing my fiance has a nicer-looking vagina than a pro model.

In reply to by God Emperor

HillaryOdor dasein211 Mon, 11/27/2017 - 19:15 Permalink

This is not a convincing argument.  Yes bubbles typically top off when most speculators have capitulated and bought in, but bubbles typically occur in assets markets that most people consider legitimate, markets with a long history of gains.  The stock and bond markets are very old and proven.  There are a whole lot of people that do not consider a <10 year old experimental software with no backing to be a legitimate asset worth holding and will never buy into it, and for good reason.  Judging the top of the bubble by the number of people you personally know invested may not be a good strategy.

In reply to by dasein211

Iconoclast421 Mon, 11/27/2017 - 18:36 Permalink

You dont say? $10,000 for something that I mined in 2011 for 5 days on my pc and then forgot? Give me a frickin break. Why not jsut go peddle tulips on the street. You might find a few suckers.