The Social World

Tag: Cryptocurrency

  • Don’t count Bitcoin out

    Bitcoin is crashing all over again, and it is taking the smaller crypto currencies down with it. It has fallen by a quarter from its highs, and there is little sign that the relentless selling is going to stop anytime soon. Plenty of people will be reheating arguments about how the digital currency is completely worthless and that the bubble was always going to pop one day. But Bitcoin has been through plenty of bear markets and it has always bounced back – and there is little reason to believe this crash will be any different.

    It is certainly a substantial fall. From a high of $114,000 a coin at the end of last month it has fallen all the way back to $83,000. It has been just as bad for the other crypto currencies, such as Ethereum and Dogecoin. The Melania meme coin, named after the American First Lady is now down by 98 percent from its highs, which is probably provoking a few frosty stares at the White House. Plenty of people will be quick to start writing off Bitcoin. It has no real value as an asset, we will be told, and the bubble was always going to burst one day. 

    Interest in Bitcoin is no longer confined to just a handful of slightly wild-eyed enthusiasts

    And yet, booms and busts are now an established part of the crypto cycle. Bitcoin has been through four major bear markets. In 2011 it crashed by more than 90 percent; in 2014 to 2015 it fell by more than 80 percent; in 2018, the so-called crypto winter, it again fell by more than 80 percent; and then in 2022 it fell by more than 70 percent. It has also suffered numerous corrections, defined as a fall of 20 percent or more. Volatility is baked into the asset. That does not, however, mean it has no value or that it won’t recover.

    In the background, Bitcoin has been moving more and more into the mainstream. The US is planning a strategic Bitcoin reserve, and the plan now has the full backing of the White House. With the launch of funds, retail investors can buy and sell crypto currencies in the same way they trade shares. Even the very conservative Financial Conduct Authority in the UK has started opening up the British market to crypto investment. Major banks such as JP Morgan Chase are now willing to accept it as collateral for loans. 

    Add it all up, and one point is clear. Interest in Bitcoin is no longer confined to just a handful of slightly wild-eyed enthusiasts. Instead, it has moved into the mainstream financial markets. The price may well keep falling for the next few weeks. But the lesson of the last fifteen years is very clear: Bitcoin has always bounced back and reached new highs very quickly. 

  • Trump is not to blame for the crypto crash

    Hundreds of billions have been wiped off the value of the crypto currencies. A prominent Ukrainian blogger and influencer on digital coins has been found dead. This will likely be a rocky day for traders. We will have to see whether it develops into a full-blown crash or not. And yet, all the major equity indices were already wildly overvalued, and a correction was always inevitable – it was just a question of when it would start. 

    Investors will also see a few days of turbulence. An estimated $400 billion was wiped off the value of the main crypto currencies on Friday evening, while the Nasdaq dropped by more than 800 points, or 3.5 percent, before the New York stock exchange closed, with the S&P 500, the benchmark for US stocks, not far behind. When markets open in Asia and then Europe they are expected to fall heavily as well. 

    The trigger for the fall in prices was the resumption of the tariff wars. President Trump slapped 100 percent tariffs on China in a row over exports of “rare earths,” critical to much high tech manufacturing. In reality, however, the markets were already wildly overvalued. Over the summer, the price of every major asset has been soaring. The Nasdaq is up by over 30 percent over the last six months. The chip market Nvidia is up by 65 percent. OpenAI, the owner of ChatGPT, reached a value of $500 billion, a record for a private company. Gold went over $4,000 an ounce, and Bitcoin went over $120,000 a unit. Even Britain’s index, the FTSE 100, managed to rise by 15 percent despite a stagnant economy. After the collapse that followed the first round of tariffs in the spring, every major index has been on an epic bull run, and had been hitting all-time highs. 

    October is often a difficult month for the market. The Great Crash of 1929 started on 28 October. The Black Monday crash of 1987 was on 19 October. The financial crisis of 2008 was more drawn out, but is generally dated as starting on 6 October that year. No one quite knows why, but the historical evidence is clear enough: October is a bad month. We will have to see whether the latest round of nervous trading develops into a full-scale collapse. With little sign of a global recession, and with the Federal Reserve in the United States, still cutting interest rates, it still seems relatively unlikely. But a correction of 10 to 20 percent in asset prices is long overdue after the exuberance of the last six months – and it looks as if that has now arrived. 

  • The Ashley St. Clair podcast you cried out for is here

    The Ashley St. Clair podcast you cried out for is here

    After a six-month absence from Cockburn’s sights – far too long, really – Ashley St. Clair, baby mama to Elon Musk’s 13th child (that we know of), resurfaced Monday.

    St. Clair has launched a 30-minute video podcast sponsored by Polymarket, the cryptocurrency prediction company.

    Sitting in what appears to be a luxury bedroom somewhere in Manhattan, wearing a black tank top and looking no worse for the motherhood wear, the Florida-born St. Clair didn’t waste any time, exhibiting some lightly ironic vocal fry, with this opening paragraph:

    After a year of unplanned career suicide, many questionable life choices and a gap in my LinkedIn profile that cannot legally be explained, I have decided to start a podcast. Not because anybody asked, but because statistically speaking, it was either this or join an MLM [multilevel marketing company]. So here we are. And unlike a Ben Shapiro or a Megyn Kelly, I’m not starting this because I think my big brain thoughts on the podcast mic are the greatest gift to humanity. I actually think I have the worst ideas. So consider everything out of my mouth a cautionary tale. Also, I’m getting evicted, and Polymarket offered me $10,000 to do an ad read.

    Cockburn found this opening appealing, witty and self-deprecating. Unfortunately, St. Clair then puts on sunglasses and Bad Advice with Ashley St. Clair begins in earnest. He had some hope when she mentioned Elon Musk – but that’s just a feint to discuss the assault on “Big Balls” that precipitated the federal takeover of DC. A half-hour of gossip ripped from the headlines ensues, a Gawker-tinged Daily Show knockoff but without the production values or commercial breaks.

    This is her advice, St. Clair says, “Take it or leave it. Probably leave it.” Probably!

    St. Clair has some potential, but she needs better writers. For $10,000 from Polymarket (a month, in bitcoin, under the table), Cockburn offers his services.

    On our radar

    BABY I GOT YOUR MONEY Eric Adams has filed a new lawsuit against New York City’s Campaign Finance Board for denying him nearly $5 million in public matching funds over allegations he committed bribery, fraud and obstruction.

    MAXED OUT Newsmax settled a lawsuit accusing it of defaming Dominion, a voting equipment company, after President Trump’s 2020 election loss. The network will pay $67 million.

    ALLIGATOR BITES NEVER HEAL After civil-rights challenges to the immigration detention center Trump dubbed “Alligator Alcatraz,” a federal judge issued a split ruling, dismissing part of the case and sending the remainder to Florida’s Middle District.

    Multiple Sclerosis News Opinion World

    MSNBC, a news outlet so left-wing it makes NPR look like The Daily Stormer, is about to undergo a name change, to become MS NOW. MS NOW stands apparently for My Source News Opinion World, which sounds like a Waystar Royco product, or the show from The Newsroom, or a North Korean state network.

    NBC Universal is ditching a parcel of media properties, including CNBC (which is keeping its name). Even though MSNBC (NOW) is hiring, Axios reports, for “dozens of new positions” in preparation for the rebrand at the end of the year, it really does feel like yesterday’s news network.

    It’s no accident that NBC Universal hung on to Bravo, which features Real Housewives, Top Chef, Below Deck and other popular reality franchises. The parent company is also keeping Peacock, a low-rated streaming service that absolutely ruled the Olympics last summer, and NBC itself, which for all the decline in broadcast TV still has the Chicago shows and frankly won’t disappear overnight.

    MS NOW, on the other hand, looks fated to have the ratings of a mid-tier YouTube news channel, or worse, to desperately suck up to whatever living shreds of the boomer-lib coalition still watches TV news. Cockburn would like to say he’ll stop watching it NOW. But, frankly, he tuned out years ago.

    Please edit my outlet, President Trump

    Shari Redstone, the former global chairwoman of Paramount, says she sold the company partly due to the October 7 coverage by its subsidiary CBS. She also hoped that President Trump’s lawsuit against the network would root out anti-Israel bias, she explained in an interview with the New York Times.

    Redstone said she believed Trump “could accomplish what I never got done.” Trump sued CBS over its editing of a 60 Minutes interview with his opponent Kamala Harris, which altered her answer to an October 7-related question. Redstone, whose ex-husband and son are rabbis, said CBS’s reporting following the October 7 attacks was “shockingly one-sided, lacked factual accuracy and relied heavily on misguided information.”

    Redstone said she was “blown away” by the settlement, since she was expecting a much higher price. Congrats for landing the only bargain in media…

    Subscribe to Cockburn’s Diary on Substack to get it in your inbox on Tuesdays and Fridays.