Mix of Old, Wrong and Dubious ‘News’ Scares Rookie Investors, Fuels Crypto Selloff
Call it the recipe for perfect market meltdown:
Take a dubious tweet about an unconfirmed U.S. investigation of financial institutions using crypto to launder money, a report that doesn’t appear to have come from Bloomberg, Dow Jones, Reuters or any other reputable news service.
Take that tweet and sprinkle it throughout the cryptoverse. Shake vigorously.
Add a new CNBC tweet about a month-old Reuters report regarding a coming crypto ban in India. Let marinate until fully absorbed, about 30 minutes.
Next fold in several (now-deleted) tweets that incorrectly implied that the Coinbase CEO had sold the majority of his stock in last week’s direct listing (he only sold 1.5% of his holdings). Whisk until blended properly.
Bake at 350 for an hour.
Serve to a host of relatively inexperienced investors who’d recently flooded into the market, driving it to all-time highs, due to the hype over Coinbase’s listing and who were already nervous about a partial crypto ban by Turkey announced last week.
After feeding that meal of purportedly bad news to that audience, it’d have been shocking if those new crypto investors hadn’t fled the table.
Give leftovers to the DOGE(coin), which like the Shiba Inu dog that represents it, can seemingly consume any combination of bad news and not be affected. The price of the meme-based cryptocurrency is up 18% over the last 24 hours, the only bright spot on a down day. Good boi!
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Afterthought: While newbies may have left the table, long-term holders are unlikely to quit, as there have been several 20% drops during the current bull run. Besides, pundits seldom take weekend moves seriously, as liquidity is low, especially in Asia. Enjoy the rest of your Sunday!