Originally published in a Bitcoin BullBear Market Update on 11/5/2014. Partial excerpt only. Written by @AKWAnalytics.
By far the most interesting development in the bitcoin complex in our opinion is the apparent decoupling from gold and silver. Over the past few months, BTC has been treated as a hard commodity by the investment community as the US dollar has strengthened. Makes sense, right?
Well, not so fast. While it makes sense that bitcoin should be treated as a commodity given the limited supply, that is not nearly the whole story. And while It also makes sense that if the dollar is getting stronger that by proxy bitcoin would get weaker, what many fail to miss is how global, frictionless, and malleable bitcoin really is. The US dollar is strong due to BOJ money printing? Buy bitcoin in yen terms and make a killing. In flies Super Mario (Draghi) to the rescue with EQE? Buy bitocin in euro terms and ride the wave. US dollar strong due to newfound Fed discipline? Buy bitcoin because… uhhh… Hey, its cooler than gold!
Our point is that we mustn’t approach this asset/currency/commodity/technology like we have legacy systems and markets. Its ingenuity and adaptability make it attractive even when it seems all odds are against it. Now, this isn’t to say that the price will suddenly stabilize and enter a goldilocks bull market, but it does tell us that staying power is real, one trick pony fiat currencies and commodities are now historic (although still needed and valuable for the time being), and the future has never been more uncertain.
Fascinating and exciting times indeed…
Cheers,
@AKWAnalytics
BTC/USD daily chart
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