An interesting confluence of events today make this crazy market seem even crazier. Covered:  More to the Pump than Technicals Rebuke of China CBDC Launch at Olympics More to the Pump than Technicals “Psychology is probably the most important factor in the market – and one that is least understood.” This quote by famed investor […] The post Coincidence? Bitcoin Pumps on China CBDC Debut, Michael Saylor’s Birthday appeared first on CryptosRus.

Coincidence? Bitcoin Pumps on China CBDC Debut, Michael Saylor’s Birthday

An interesting confluence of events today make this crazy market seem even crazier.

Covered: 

  • More to the Pump than Technicals
  • Rebuke of China CBDC Launch at Olympics

More to the Pump than Technicals

“Psychology is probably the most important factor in the market – and one that is least understood.” This quote by famed investor David Dreman is at least intuitively understood by most investors. Today’s price action shows it to be more true, however, than many would care to imagine.

Sure, we had the jobs numbers, but considering the bleak macro outlook is wholly unchanged by a decent jobs report, that seems like too easy of a reason for the giant green bitcoin candle we have seen today.

Then there’s the on-chain data. As analyst Dylan LeClair pointed out on Twitter, the funding rate (cost to hold a long or short position) has bled into the negative. Meaning, shorts are paying a premium to hold their position.

These are the “predicted funding” rates. LeClair uses this because current funding rates are more or less a lagging indicator. Negative funding rates with upward price action set the table for a short squeeze. However, this is not an exact science and is more probability based than anything.

Nonetheless, it is possibly a reason for the green candle, too. Notably though, there haven’t been many short liquidations for a move this big. In the last 12 hours, only 172 million dollars worth of short positions have been liquidated, which is a relatively tame number.

liquidations in the last 12 hours

In light of all this, it is plausible that the pump was simply a rebuke of China, the notion of ominous CBDCs, and yes, even because its Michael Saylor’s birthday. As CNN points out, “China’s digital yuan is poised to make its debut on the global stage this week.”

Rebuke of China CBDC Launch at Olympics 

China is hosting the 2022 Winter Olympics, and today the opening ceremonies were held. Bitcoin pumping hard in the face of this is the ultimate gut punch to the country that extricated all the miners while denouncing Bitcoin in favor of their Orwellian digital Yuan.

Even CNN stated in their article today: “The rise of CBDCs highlights the importance of decentralized cryptocurrencies that are relatively private and not controlled by any government. It’s going to be easy for the central bank [of China] to turn off any wallets they want to turn off.”

To this point, maybe this is why Monero, the pre-eminent private, decentralized currency, is pumping hard, up 13% today; up even on the BTC pair.

So it would make sense that bitcoin whales, institutions, or whoever drove the demand today did this as a vote of confidence for Bitcoin and other decentralized assets, and as a middle finger to CBDC’s as Beijing tries to sell the world on its digital yuan during the Olympics. That is exactly what Beijing is doing, too. Al-Jazeera reported that “China is using the Beijing Winter Olympics as a showcase for its official virtual currency.”

digital yuan transaction

Interestingly, as noted in the beginning of the article, it is also Michael Saylor’s birthday. The biggest bitcoin bull on the planet turned 57 today. It is just a matter of pure chance that these two events would coincide on the same day. Markets certainly do work in mysterious and strange ways.

A pump was not expected anytime soon considering the macro. As Dylan LeClair tweeted: “Lots of trading desks who dumped the last two weeks are likely watching in disbelief..” It is a crazy market indeed. Maybe the market is letting it be known that crypto is here to stay, even in the face of regimes like China and their CDBC.

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