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Welcome to what is seemingly becoming an ongoing weekly occurrence in the crypto market. Just this week the US CFTC came out and sued BINANCE and CZ. They are alleging that Binance was actively trading against their customers. While it is too early to say if these allegations are true or not. It still had a large effect on the price of Bitcoin. Sending the price down more than $1,000 in mere minutes. But that isn’t even the main takeaway from this situation.
It is clearly evident now that the US government has come out in full force against cryptocurrency. Most likely all as a result of the FTX fraud last year. They have already gone after 3 of the biggest players including Kraken, Coinbase, and now Binance. We have to begin wondering what is their next move, and what is their overall goal.
Simply put, it appears that the US government is quickly becoming aware of how grave a situation the dollar could be in. There is no denying that it is quickly losing power in the mind of the world, and that can all be linked back to when the US sanctioned Russia. Essentially seizing or blocking Russia from their dollar assets. Since then Russia has strengthed its ties with China and is moving to do even more trade in Yuan, excluding the dollar. While this may seem like a boring discussion about money, the truth is that a large amount of US power comes from them having the world reserve currency. They are allowed to print as much money as they want, with little concern about their raising debt. The US’ largest export is dollars and debt.
Now it appears that Russia, China, and several other countries will begin opting out of the dollar. Then add the fact that banks in the US and also around the world have been collapsing. This has caused even more doubt in dollars and fiat currencies. In just one week alone, this banking situation caused the price of Bitcoin to soar from $19k to $28k. And large amounts of people began opting out of the dollar or other fiat currencies. Instead opting to put their money in Bitcoin.
There have been strong rumors that the banking and financial crisis is far worse than we have been told or could imagine. That we are on the brink of something horrendous. Perhaps, the government is all too aware of this. They already know how bad the situation is, and they already know that it would cause a stampede rush toward Bitcoin. Maybe this is why they have been so admittedly enforcing their “operation chokepoint” against crypto. Which is their strategy to cut off the on/off fiat ramps to crypto. You and I can see this because we are deep in this market. But the average person isn’t seeing this how we are.
Imagine if you were a regular person who knew next to nothing about Bitcoin or crypto. Throughout the last year, you kept hearing bad things one after another about this market. First, it was the crypto lending insolvencies. Then FTX caused one of the largest frauds in the history of finance. Causing prices to go down by around 80%. If that wasn’t enough, we then see that the biggest exchanges and people in the industry continue to be accused of wrongdoing by the US government. All of this would lead you to believe that Bitcoin or crypto is a very dangerous market that you should avoid at all costs. That is the government's plan, as they are trying to protect the power of the US dollar. The government can’t ban Bitcoin, but you can be sure that they could do an awful lot to try and completely kill off public interest in it.
At this pace, you have to begin to wonder just how many of these attacks Bitcoin can handle. If Binance or CZ ends up being corrupt, would it cause the death blow to Bitcoin and crypto?
It’s an absolute fact that this revelation would cause extreme harm to the crypto market. Prices would fall further, but it would be another huge dent in the crypto market’s reputation. At some point, there is only so much it can take before recovery is an impossibility.
However with all of that said, Bitcoin has proven to be one of the most resilient assets over the last 3 years. Dealing covid panic, inflation, Elon & Tesla selling, China banning Bitcoin and mining, the Russia/Ukraine war, rising inflation, countless insolvencies, FTX fraud, and now the US government attacking the industry hard. With all of that happening, Bitcoin’s price is still around $27k at the time of writing. This alone is a very bullish thing.
If Binance and CZ fell, or if the government continues attacking crypto we could be in for a rough few months or even years. With that said, Bitcoin has shown time after time that it can’t be kept down, even during the most bearish of situations.
How about you? What do you think the death blow to Bitcoin would be?
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