The bitcoin bubble explained: Understanding the mathematics of the inevitable bitcoin crashBitcoins, like stocks, create the illusion of free wealth during a rise in valuation
Now you see how easily the central banks could be manipulating bitcoins into a sky-high bubble followed by a crash.
How the central banks can easily crash bitcoin valuations back to historical values
If you're a central banker, you hate bitcoin. You want to see it destroyed, of course, but more importantly you want to see it discredited. You want to portray it as a "pyramid scheme" that ultimately hurts a lot of people. And you want to promote the "safety" of government-backed banks (i.e. central banks).
How to accomplish this? It's stupidly simple: Just start creating money out of nothing (i.e. crank of the U.S. dollar printing presses) and use that fake fiat currency to purchase billions of bitcoins at ANY price, driving bitcoin valuations sky-high.
Keep pumping money into bitcoins until the speculators ("fools") jump on board, thinking they're all going to get instantly rich by joining the latest new "free money fad."
Stand back as the bitcoin valuations reach the stratosphere, suckering even more people into parting with their hard-earned cash by buying into the system.
And then, when the timing is right, start SELLING billions of bitcoins into the marketplace at any price. FLOOD the marketplace with your entire inventory. The price support for bitcoins will shudder and collapse, and once the collapse begins, fear will kick in and sellers will pile on. As the prices collapse even further, fear will turn to panic, and people will attempt to "sell everything at any price!"
That's the point where bitcoin crashes hard, thereby accomplishing the exact goals of the central banks. History shows that markets crash FASTER than they rose, so you can expect the eventual bitcoin crash to be wildly accelerated in terms of velocity. Billions of dollars in valuation will be wiped out overnight, and more importantly, the reputation of bitcoin will be destroyed.
Mission accomplished for the criminal central banks who excel in market manipulations and psych warfare.
Mark my words: Bitcoin is headed for a disastrous crash. All the signs are there. It's undeniable. When speculative investors, driven by greed, flood a particular investment vehicle creating a fast-expanding bubble, a crash is inevitable.
But nobody knows just how high bitcoin might go before greed turns to fear. It could reach $500, $5,000 or even $50,000 per bitcoin before this happens. If more craziness unfolds in the EU, that could also accelerate a rush of capital into bitcoins, causing their value to skyrocket even more.
But make no mistake: Bitcoin has now become a casino. If you are buying bitcoin right now, you are gambling with your money. There's a sucker born every minute... try not to be one of them.
Personally, I'm saddened to see bitcoin become a speculative investment fad. It's going to harm the credibility of this currency that the world truly needs as a long-term decentralized crypto-currency. I want bitcoin to succeed in the long run which is why I lament the manipulated bitcoin crash that I know is coming.
Rest assured, however, that I will be buying up bitcoins in huge numbers once the crash fully unwinds. There's never a better time to buy than when all the world's sellers are in a panic, trying to unload their bitcoins at any price.
