The squid of rodenticide becomes a hedge asset? Bitcoin rose more than 70% in the month, Buffett added another fire to lunch?

The news of the 2019 Buffett benevolent luncheon was recorded at the record price of the new generation of “90 million dollar circle”.

After more than a year of silence, bitcoin prices rose strongly in May, and the highest increase was more than 70% in the month. Compared with the low of 3500 US dollars at the beginning of the year, the increase is even 150%, which is one of the best investment targets this year.

At the beginning of June, bitcoin prices fell sharply. As of press release, the gate.io platform offered a price of $7750. In the eyes of the outside world, there seems to be no logic in the rise and fall of the currency price, but in the eyes of the industry, everything is traceable. Admission of mainstream institutions, stronger consensus and USDT are signs of market transformation from bear to cattle. With the rise in the price of money, the price volatility is also increasing.

Bitcoin’s best assets in adulthood

Compared with $3500-4000 at the beginning of the year, bitcoin’s highest growth rate has exceeded 150%, making it one of the best investment targets this year.

In May 1st, the lowest price of bitcoin was $5320. In May 4th, it broke through the $6 thousand mark, and then broke through the 7000 and 8000 US dollar pass. In the early morning of May 31st, it broke through again by a sharp break of 9000 US dollars, and dropped rapidly after 15 minutes.

Demand side force and price rise complement each other. When prices begin to bottom up, there is a distinct upward trend in approach capital. At present, the price of USDT is US $7.16, which is 3.5% higher than the US dollar and RMB exchange rate. Investor Chen Yan believes that at present, there is a lack of substantial investment targets on the global scale, long-term volatility of commodities and relatively high stock prices. At the same time, bitcoin prices are relatively low, and $3000 will be considered an excellent entry point.

The contract emperor COO duwan told a broker China reporter that from the historical trend, bitcoin rebounding from $1150 to US $150 in 2014, it has springback six times in the vicinity of US $300-400, and has fallen to 150 US dollars seventh times. In 2018, six US dollars from 20000 US dollars were tested for 6000 US dollar pressure, and then seventh fell to more than 3000 US dollars. In 2015, bitcoin tried to break through $300 from $150 for two consecutive times, but failed to rise to $520 third times. The difference is that the first time it broke through 6000 dollars.

6000 dollars was once considered an important resistance to currency prices. After the first breakthrough in May 4th, the market generally thought it would be callback, but only three days later, it was firmly in the position and continued to go up. “This is a process of bargaining chips.” Du Wan said that there was a large number of empty seats in the position of 6000 dollars, 6500-7000 dollars exploded the high leverage, and the lower leverage broke out in 8000 US dollars, so it was normal for the main force to pull up to nearly 9000 dollars.

“Many people are surprised that this increase is so rapid. In fact, the logic is very clear.” Ren Wenhao, a senior digital currency trader, told Chinese reporters of securities business that first, when the bitcoin price was around us $3000, there was a large amount of funds to absorb chips. We must profit by pulling up the shipment. Two, the main force was to attract attention and money through a rapid increase.

Chen Yan believes that the logic of the rise of the current round of subtle changes, mostly hype before, but recently from the transaction time and disk observation, the current round of rising driven by overseas markets, “the recent several pulls occurred in the early morning, and all started from the Bitstamp platform. China’s trading partners are basically in the currency or OK. This exchange has fewer users in China. It is very likely that the main force of this wave is driven by foreign countries. Chen Yan said.

Xiao Lei, a senior digital currency analyst, told broker China reporters that the rise in bitcoin prices was not a geek’s utopian vision, nor a dream of the riches of grass-roots retail investors. Instead, many international rich clubs began offering bitcoin services to the super rich.

Xiao Lei said that since the beginning of last year, Goldman Sachs has been involved in the bitcoin market in a high profile. First, it asked users to compare the price of special currency, and then began to use its own capital trading bitcoin futures on behalf of customers. In September last year, Morgan Stanley planned to introduce a price returnswap bitcoin derivative to its customers. In March of this year, FDAS, a digital asset trading and trusteeship group under the fortune trillions of the world, began to support the hosting of bitcoin assets. In the future, the allocation of digital assets by mainstream institutions is a noteworthy highlight.

Buffett again detonated coins in lunch

In the early morning of June 4th, Sun Yuchen released a message through micro-blog, saying, “I officially announced that I won a record 20 Buffett charity lunch auction. I will also invite the leaders of the block chain industry to meet the investment leader. I hope this will benefit everyone.

You know, Sun Yuchen won the Buffett charity lunch for $4 million 567 thousand and 888 and set up a Buffett charity lunch auction record. This move, in addition to let Sun Yuchen fame, the money circle once again returned to the public view.

However, from the perspective of reaction, block chain and encryption community seem to be not very popular. The Chinese reporters of securities companies have noticed that on the same day, whether WeChat group, circle of friends or micro-blog commentaries, many people think that this is another marketing behavior of Sun Yuchen. A circle of media people in the circle of friends said, “Sun boss spent about 30000000 RMB to eat a meal with Buffett, do a round of communication, pull a plate, cut a wave of leek, and came back. Indeed, he admires sun boss’s courage, and every time he decides the input output is very strong.

More interesting is that Buffett and his old partner Munger are not the supporters of virtual currencies such as bitcoin. On the contrary, Buffett has publicly criticized bitcoin in many occasions, and has clearly stated that bitcoin is not investing two in gambling, and it will not invest 10 Fen in it.

When bitcoin was more than 100 dollars, Buffett said bitcoin was a rat poison. When a reporter asked him, bitcoin rose from $more than 100 to $more than 9000. What’s her view on this? Buffett replied, “it may be the square of rat poison.” At the fifty-fourth annual general meeting of Boxill Hathaway, held in May 4, 2019, Buffett said bluntly that bitcoin speculation reminded him of gambling in Las Vegas.

So when the news came out, the first reaction was how to eat this meal. And how Sun Yuchen “sold” bitcoin to Buffett has also become the focus of attention.

Bitcoin is not a risk aversion asset.

Compared to the unilateral rally in May, bitcoin prices began to fall after the high inflation trend in June, and the price has fallen below 8000 US dollars.

In the view of Du Wan, bitcoin has been rising four weeks at the weekly level, and there is a demand for callbacks in terms of technology. “The cost of entering the capital is about $7400-8000. If the volume falls below US $7000, the new short-term or speculative capital will probably be cut off. If this kind of clearing occurs, the price of bitcoin will be reduced to $6000.” Ren Wenhao told reporters.

It is worth noting that although bitcoin rose in May, the once popular Shanzhai coin did not keep up with the rise of bitcoin. Most currencies had little fluctuation in price. In this regard, duwan believes that the cottage money is originally lacking in value and consensus, and that the market is transformed from bear to cattle. Ren Wenhao believes that the cottage coin is a highly manipulated market, whether the price will rise depends on whether the dealer has the desire to pull the plate.

The rise of prices is likely to cause market speculation. Along with this round of rising prices, one voice is that bitcoin has become a hedge asset. The main logic of this view is that bitcoin will become another asset allocation option when other assets are not performing well. “Bitcoin is still a risky asset.” Chen Yan believes that the current price of bitcoin is still the main factor of speculation, and can not be equivalent to gold, but because this year bitcoin gains beat other targets.

Zhao Jian, Dean of the Cesar Research Institute, believes that in fact, the pricing power of bitcoin is still US dollar, so there is still no absolute escape from this system. Zhao Jian said bitcoin issuing discipline and gradual strengthening of the rules of consensus, making it more and more similar to hedge assets gold. But unlike gold, bitcoin has no practical value. The digital assets of bitcoin form a rule consensus through algorithmic technology, thus forming a predictable growth curve. With the strengthening of consensus, assets are formed – traders in the current period need not worry about not having the next “receiver”.   

Source: China Securities Broker

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