Is crypto dead forever?
117: Crypto markets dump to lowest levels in years amid massive scams
Markets review will go out tomorrow for all subs but today we needed to get out an important overview for our loyal subs and long time crypto proponents.
Side note we will cover once elections are over:
So midterms were a big nothing burger. DenSantis flexed on TV with his hot wife and the dems pulled off what appears to be a surprising defense of the House and the senate — although at the moment the race for senate remains very close with Nevada and Arizona taking forever to come up with results. The purported and shilled “Red Wave” didn’t happen (odd).
Would love to know why that was the narrative that got sold and reality turned out to be the opposite.
Food for thought. I know some guys from Arizona that I met through work and school. Anecdotally for what it’s worth, Arizona culture is hard right from what I can tell, more so I imagine since the Trump era.
I think it’s a bit odd Arizona is taking so long for an outcome and I also think it’s kind of strange that unfounded rumors of a “Red Wave” ended up fizzling.
ANYWAY.
CRYPTO DOOMS DAY
Yesterday a massive liquidity crisis was triggered by a goblin named Sam Bankman Fried (know formally known as Sam Bankman Fraud, the new era Bernie Madoff, who was running a massive leverage ponzi exchange known as FTX. The dude’s net worth dropped 90% in less than 24 hours and at present it looks like he completely evaporated $8 to $11 Billion dollars.
At first the outcome looked salvageable as other firms stepped in to jump at the opportunity to acquire a distressed firm but the end results are now much more grim.
Binance said in a statement that it was abandoning the deal because of “mishandled customer funds” turned up by its review of FTX’s books and because of press reports that U.S. regulatory agencies would be investigating FTX ( Washington Post).
Thousands of people have lost their entire net worths forever and the industry will likely be in shambles for a very very long time.
Contagion from the calamity is now reaching to other exchanges as BlockFi the prominent crypto lending platform shut down withdrawals last night.
As of now we are hoping something else doesn’t rupture but it could very well occur given the tangled web of leverage that has been built up over months and months.
The cascade effect and contagion impacts quickly traveled throughout the industry triggering a severe bloodbath and panic selling of almost all major crypto assets.
FTX as of this morning filed for bankruptcy.
For those of you who don’t know the story — we first invested in the crypto space back in 2017 when some senior traders I worked with began speaking of a new brewing digital gold rush that could make you rich — that this was the next modern gold rush. I will never remember getting into Bitcoin around $13,000 and riding it up to $18,000
It didn’t take long for that bull market to end and for me to ride the entire position down to the depths of hell watching all my gains disappear and bag holing positions for years. But I held them.
I still hold those same positions to this day.
What’s going in at the moment in the space is a massive detriment to the industry. But it will pass and when it does the core assets in crypto/defi will pump again, just as they have for the past 10 years or so.
But as everyone can see now — it won’t be a straight line of adoption and stability.
This will be relevant if you think you fall in to the following categories:
A complete noob to crypto
A seasoned trader who just took one on the chin
Interested and up to speed on basics but looking for a second opinion on what comes next
Convicted in where you think crypto goes next but want to reinforce your thoughts
This thorough overview will have food for thought and tips for all levels of crypto enthusiasts and investors at a pivotal time in these markets.
Now more than ever is an excellent time to go over the tried and true basics to survive the space. Other investors and traders have asked us the following in the last several days and weeks:
Is my money safe on exchanges?
Where do you think crypto goes in the next 3-6 months?
Is it completely over?
Which assets are likely the best ones to pick up at a discount now?
How can I protect my money and assets effectively with all this chaos and fuckery?
Will regulation screw everything up?
Will I make my money back if I hold?
We’re not the ultimate expert voice on all things crypto but we know enough ( from mistakes and successes) to give you all an excellent run down of what to expect next, how to survive what’s coming, identify new opportunities, and avoid the threats of centralized exchanges, scam coins and bad actors in the space.
The ultimate goal is to build long term wealth in the space by accruing sizeable positions THAT YOU MANAGE over years of investing. That’s it.
We’re not trying to hit $2M in one trade — although that could be a lucky bi product of our picks. If you follow these basic principles you are almost guaranteed to win on a long enough time frame. Now, when the doubters are the strongest and the noise and BS is the loudest, is the time you want to be making decisive moves.
Do the exact opposite of the masses.
Now is not the time to panic and dwell on these setbacks, keep clear eyes and your head on a swivel as there is sure to be immense opportunity to be had when the dust settles.
We are close to peak fear and because of that there are opportunities to be seized.