Expert Reveals How “Fake Supply” Is Killing Your Bitcoin Gains

    Caitlin Long, the founder and CEO of Custodia Bank, reveals that the BTC price should have hit somewhere close to six figures in the previous cycle. In an interview with Robert Breedlove’s “What Is Money” podcast, Long reveals that “paper bitcoin” has created a fake supply of BTC.

    The 21 Million Trap

    Bitcoin’s limited supply is one of its most bullish features. Its scarcity makes BTC more valuable than Gold and other traditional stocks. In an interview with CNBC, Thomas Farley, the former president of the New York Stock Exchange, pointed to Bitcoin’s limited supply as an important feature. He believes that this property makes BTC a must-have in one’s portfolio.

    There can only ever be 21 million Bitcoin.

    However, as Long explains, the financialization of Bitcoin can make its limited supply irrelevant. According to her, paper Bitcoin or IOU are meeting real demand with fake supply. An IOU is a promissory note, which acknowledges debt. 

    Long reveals that if all the IOU is combined, the total amount of BTC promised to people is more than the Bitcoin available today. More than 19.1 million Bitcoin have been mined as of now. 

    Long points out that the intermediaries and financialization of Bitcoin are a threat to the price of BTC. 

    Not Your Keys, Not your Bitcoin

    Caitlin Long questions the intent and the role of intermediaries in the BTC trading market. She reveals that she also was once a user of crypto exchanges. Long learned her lesson after the Mt. Gox hack that central intermediaries are not trustworthy. She believes that self-custody is the way to go.

    Long believes that a lot of leverage is present in the market. While the March 2020 market crash due to the pandemic flushed out a lot of the leverage, it build right back up. According to her, the ongoing deleveraging which is forcing many big crypto exchanges to go bankrupt is driving the latest iteration of panic.

    Nidhish is a technology enthusiast, whose aim is to find elegant technical solutions to solve some of society’s biggest issues. He is a firm believer of decentralization and wants to work on the mainstream adoption of Blockchain. He is also big into almost every popular sports and loves to converse on a wide variety of topics.

    The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

    Source link

    Latest stories

    - Advertisement -

    You might also like...