Connect with us

Bitcoin News

Beyond Meat: This Stock Bubble Could Mirror the Bitcoin Crash

Beyond Meat: This Stock Bubble Could Mirror the Bitcoin Crash

Beyond Meat: This Stock Bubble Could Mirror the Bitcoin CrashBeyond Meat stock is surging, but it could be setting investors up for a Bitcoin-style crash. | Source: Drew Angerer / Getty Images / AFPBy CCN: Beyond Meat (BYND) is Wall Street’s newest darling. After its stock rallied 168% in the best IPO in a decade, the vegan burger maker continues to impress while the rest of the Nasdaq suffers heavy losses. There is an unfortunate truth beneath all of this hype, and to explain it we need to look no further than the Bitcoin bubble.Deja Vu: Beyond Meat Feels Uncomfortably Like Bitcoin in 2017Beyond Meat stock (BYND) soared on Tuesday even as the stock market plunged. | Source: Google FinanceWhen cryptocurrency exploded into the public consciousness in 2017, led by meteoric gains in Bitcoin, everyone wanted to talk about blockchain. The groundbreaking technology that underlies many digital coins was so new that there was almost no way to play it outside of investing directly in cryptocurrency assets.Beyond Meat is in precisely the same situation, except in the world of vegan meat. A rapid increase in valuation often creates an extremely “bubbly” situation. Longer term, bubbles are fantastic for disruptive industries. The attention they bring loads the fledgling technology with an abundance of capital to make the developments they need.For nervous investors, however, bubbles can be a disaster.Beyond Meat Copycats Could Leech Market Share – For NowBeyond Meat loses money and still has a long way to go before their meatless burger entirely displaces the beef establishment. A bubble is the only way to get enough money into their hands to stand a chance.If Bitcoin had not rallied to $20,000, there is no question that Crypto Winter would have been a lot longer and a lot harsher than it has been.The Bitcoin price bubble arguably strengthened the cryptocurrency over the long-term, but it punished weak-handed investors in the process. | Source: CoinMarketCapSimilarly, the avalanche of interest in internet companies is what created the dotcom bubble that ultimately spawned Google, Amazon, and the like – slaughtering scores of other tech startups in the process.As capital flowed relentlessly into Bitcoin, Wall Street copycats tried to get in on the action with ludicrous plays like “Long Blockchain.”Other companies will see the success of BYND and dive headlong into the plant-based meat industry. Tyson Foods plans to join the party, which is a bit like Exxon Mobil investing in wind energy. Impossible Foods will now certainly be courted to go public and swipe a piece of market share.We all know what happens when the bubble bursts. You grow disillusioned and focus more on the asset’s flaws than its underlying potential. It doesn’t matter that you know it will eventually change the world because people can’t short it fast enough. Ultimately, the eduring value will create a price floor, but your belief is gone. Finally, the early adopters move in again and buy it cheap while you sit paralyzed.Bitcoin Lesson #1: Being First Is Harder Than You ThinkThe point is this: given the unique market position that Beyond Meat holds, a price bubble looks inevitable. With 170%+ price gains in its first few days of trading, this prophecy is becoming a reality.The fear of missing out is real and powerful. Bitcoin traders have learned that Hodl is more than a meme; it’s the only way to survive the roller-coaster of investing in a frontier market. BYND bulls will need to be equally resilient. About The AuthorFrancois AureFinancial speculator living in the hills in Los Angeles. J.D. but very much not a lawyer. Favorite trading books are anything written by Jack Schwager.
Source

Continue Reading
Advertisement
Loading...
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Bitcoin News

Bitcoin Beats Other Cryptos in ‘Smarter’ Bull Market, Says Billionaire Investor

Bitcoin Beats Other Cryptos in ‘Smarter’ Bull Market, Says Billionaire Investor

Bitcoin Beats Other Cryptos in ‘Smarter’ Bull Market, Says Billionaire InvestorBitcoin’s dominance will only be more pronounced in this bull market and that’ll show in its value, according to Mike Novogratz. | Source: ShutterstockBy CCN: Mike Novogratz, the billionaire CEO of Galaxy Capital and a former hedge fund manager at Fortress Investment Group, believes alternative cryptocurrencies, or altcoins, will be outperformed by bitcoin in the bull market.Not this time. Market getting smarter. $btc will outperform.— Michael Novogratz (@novogratz) May 19, 2019The statement of Novogratz comes after the bitcoin price risen by more than 115 percent year-to-date against the U.S. dollar, leading the crypto market to add $124 billion to its valuation.Will bitcoin continue to outperform altcoins?Historically, altcoins have relied on the price trend of bitcoin and have rarely demonstrated independent price movements in extended time frames.Altcoins typically surge in value when the bitcoin price shows stability at a tight price range, leaving investors to take high-risk and high-return options over the dominant cryptocurrency.The optimism towards bitcoin, despite the emergence of sophisticated altcoins, is well founded due to the involvement of major financial institutions in the likes of Fidelity and TD Ameritrade building infrastructure on top of bitcoin.Fidelity and ICE, the parent company of the New York Stock Exchange, are initially launching custodial services for bitcoin, targeting institutional investors.According to TD Ameritrade’s executive vice president Steven Quirk, tens of thousands of clients at the brokerage already trade crypto assets in some capacity.But, traders suggest that if the sentiment around the crypto market remains overwhelmingly positive, investors will eventually explore alternative opportunities for high-return trades, which then may fuel a rally for altcoins.One cryptocurrency trader said that bitcoin is likely to climb further throughout 2019, triggering a healthy market for altcoins:The rest of this year will be characterized by rapid BTC advances, healthy corrections and periods of sideways price action, when altcoins will fly. Put that nonsense rhetoric about waiting for capitulation and still not making our bear market lows away. Wrong cycle.Full on degen altcoin season still on track for June. Next few weeks, as BTC finds a range, we’ll continue to see the popular altcoins bounce back 1st. In June, all altcoins across the board will bounce back hard. More disbelief on its way.The concern of some investors like Novogratz on the prospect of a booming market for altcoins is that many retail investors were hurt in the 2017 bull market taking high-risk trades, trading against stable assets like bitcoin.As the market matures and as investors in the market become smarter, Novogratz indicated that the appetite for altcoins could decline.The crypto market has added more than $100 billion to its valuation year-to-date (source: coinmarketcap.com)Similarly, Jeff Sprecher, the chairman of the New York Stock Exchange, said in November 2018:Somehow bitcoin has lived in a swamp and survived. There are thousands of other tokens that you could argue are better but yet bitcoin continues to survive, thrive and attract attention.At the time, Sprecher emphasized that Bakkt, a futures market operator created by NYSE’s parent company ICE, will focus on building a regulated infrastructure for bitcoin first ahead of other assets.Sentiment is generally positiveOn May 17, as CCN reported, the bitcoin price plummeted by 18 percent within hours following an unexpected 5,000 BTC sell order on Bitstamp that led prices of bitcoin and ethereum to crash on BitMEX.The market absorbed the abrupt decline in the bitcoin price fairly well, indicating that the confidence in the near-term price trend of crypto assets remains strong.While investors have cautioned that bitcoin has shown oversold conditions in recent weeks as it surpassed key resistance levels, the momentum of the asset could prevent it facing a large correction some expect would occur in the near-term. About The AuthorJoseph YoungHong Kong-Based Finance and Cryptocurrency Analyst. Contributing regularly to CCN and Hacked. Providing unique insights into the crypto and fintech space since 2012.This article was edited by Samburaj Das.
Source

Continue Reading

Bitcoin News

Bitcoin’s price has pumped beyond its ‘intrinsic value,’ JPMorgan says

Bitcoin’s price has pumped beyond its ‘intrinsic value,’ JPMorgan says

Banking behemoth JP Morgan Chase & Co. has taken another shot at Bitcoin, BTC claiming the cryptocurrency‘s latest rally has pushed its price beyond its “intrinsic value.”
“Over the past few days, the actual price has moved sharply over marginal cost,” JPMorgan analysts wrote in a note obtained by Bloomberg. “This divergence between actual and intrinsic values carries some echoes of the spike higher in late 2017, and at the time this divergence was resolved mostly by a reduction in actual prices.”

To come to this conclusion, the JP Morgan team treated Bitcoin as a commodity, calculating its “cost of production” based on a number of factors, including estimated computational power, electricity expense, and hardware energy efficiency.
“Defining an intrinsic or fair value for any cryptocurrency is clearly challenging,” the analysts continued. “Indeed, views range from some researchers arguing that it has no fundamental value, to others estimating fair values well in excess of current prices.”

Bitcoin‘s price briefly dropped from almost $8,000 to $7,050 on May 17, after $250 million of long positions got liquidated on BitMEX. Since then, BTC has surged back to $7,893 at the time of writing.
By now, JP Morgan has made a habit out of thrashing Bitcoin and cryptocurrencies. Back in 2017, CEO Jamie Dimon called the currency a “fraud” – a statement he later softened, suggesting he simply doesn’t care about Bitcoin. Since then, JP Morgan launched its own blockchain-based “digital currency,” which was neither a cryptocurrency, nor a stablecoin.

Published May 20, 2019 — 11:54 UTC

Source

Continue Reading

Crypto Live Prices

  • USD
  • EUR
  • GPB
  • AUD
  • JPY
Advertisement
Loading...
Advertisement
Advertisement

Trending

Copyright © 2018 Crypto141.com