Bitcoin Manipulation Theory
I have a pretty crazy theory that I want to share but hopefully I won't break the record for downvotes in the process.
I have been thinking for a while that something seems suspicious about the way the market has been moving lately. Isn't it strange how most of the coins pumping are all "cheap" as in they are less than $10 per coin? Isn’t it strange how the crypto market cap grew by $58 billion today, but Bitcoin’s market cap did not change at all? Then I had a realization. What if everyone is being played by a greater power. If you don’t like conspiracy theories stop reading now.
Everyone has been justifying the altcoin surges as Bitcoin taking a rest and dumb money chasing “cheap coins”, but what if it is actually institutional investors using alt coins in order to accumulate Bitcoin. It makes a lot of sense. If you look at the dates the surges started
- XRP - December 8
- XLM - November 27
- IOTA - November 6
- ADA - November 27
- XEM - December 8
The futures trading press release went out on December 1, but what if some people knew that it would be approved ahead of time? If you are an investor with deep pockets you have a problem. You want to be able to bet on Bitcoin’s future price, but you don’t own enough Bitcoin to be able to manipulate the market (it is much easier to gamble when you control the outcome). You need a way to accumulate. Articles start to hit the press about how a small group of whales control a huge amount of the supply of Bitcoin and that makes it dangerous, etc. Big players are trying to convince people that Bitcoin is not a safe investment. Lots of bubble talk spreads. Jim Cramer says you are better off going to Vegas than buying Bitcoin. It doesn‘t scare the public away.
These investors are usually the ones who get first stab at new assets. They get to invest early in companies, they get first stab at IPO shares when a company goes public, but with Bitcoin they are late to the party. How are they going to accumulate? They aren’t stupid. They realize that driving the price of Bitcoin down too much to buy cheaper will scare people away from the market, and there is a limited amount of downside (it can only go as low as $0), but there is an infinite amount of upside. They also don’t own enough Bitcoin to crash the market that far. So what do they do?
The answer is, find alt coins that are “cheap”. They know that if someone has to choose between a $15,000 dollar coin and a $1 coin they will choose the $1 coin every time. It is a psychological thing. Everyone just looks at the price and believes that $1 coin can also go to $15,000 one day. So if institutional money starts to buy up huge amounts of these “cheap coins” and gets the general public on board, they can then accumulate huge amounts of Bitcoin without the Bitcoin price changing at all because alt coins trade against Bitcoin! If you want to quadruple the amount of Bitcoin you have, it is much easier to pump up a smaller coin and sell it, than it is to drive down the Bitcoin price 4x to accumulate more for the same amount of USD.
Take a look at some of the headlines lately. I suspect the press releases are also coordinated:
- RIPPLE to become the new BITCOIN? Surge in new cryptocurrency as banks FAVOUR it
- Bitcoin latest: Ripple’s XRP is best-performing cryptocurrency with 380-fold increase in 2017
- Bitcoin price WARNING: The cryptocurrency will burn out in SPECTACULAR CRASH
- Bitcoin is Akin to Gambling, Causing Egypt to Ban It
In addition to these alt coin surges, every time Bitcoin looks like it is going to break out a new sell wall appears and some market selling into the buys begins to drive the price back down. To me this is a very well executed effort to hold down Bitcoin’s price while accumulating more by pumping alts. I noticed earlier today a $1 million buy wall on XLM that was moving up as the price increased. Is that how a normal person would buy up XLM? It is possible, but I doubt it.
I know it seems wild, but if this theory is correct then it means at some point there will be a pretty fantastic dump with alt coins and a giant surge for Bitcoin.
Of course, I could also just be thinking crazy thoughts.
Also posted on reddit: https://www.reddit.com/r/BitcoinMarkets/comments/7nzlwh/bitcoin_manipulation_theory/
I keep a certain % btc as leverage in case this happens, dosen´t sound far fetched at all!
Thanks
Thank you! I think a lot of people don’t like conspiracy theories because it calls into question the way they are taught to think about the world. I personally like to challenge myself with other possibilities.
Critical thinking is very important, good job!
This is a fun idea, but ultimately circumstantial. I don't think things are being orchestrated to the degree that you ascribe them to be. Banks are certainly interested in the space and they are certainly entering it. They may be keeping Bitcoin's price down a bit to attain more favorable pricing, but at a market cap of over $200 B, wouldn't that be pretty difficult to do for very long? It is also hard for me to believe that there are people at various banks pumping dozens of alt coins. I just can't see it.
I'm no fan of conspiracy theories, and as such, I agree with your sentiment. And am a little sceptical about OPs theory.
However, remember LIBOR? https://en.wikipedia.org/wiki/Libor#Reliability_and_scandal It was considered a really wacky tinfoil-hat-theory that competing banks would collaborate in secret, undetected, in order to manipulate the interest-rates. Yet, it proved through.
I would not be suprised to see that there is an international group of people within competing banks, attempting to get a grip on the altcoin market through a variation of schemes. Including some coördination on what alts to buy, pump and sell.
Great post! That theory isn't as crazy as you think. In fact, it isn't crazy at all. There are far more devious things going on in the financial markets. I work in finance, and I have no time for conspiracy theories, but this strategy is actually kinda clever. I doubt that there is a cabal of bankers pumping and dumping, but I wouldn't be surprised if at least a couple of funds have tried it. Heck, I might even be tempted (if I have the capital!)
I like your theory! It's always seems to be the same pattern. Price analysts are constantly predicting Bitcoin price rising in the last days, but nothing happens. However, altcoins are increasing insanely, and mostly those with lowest values...
Or could it be possible that Ripple wants to be the new reserve currency (The Flippening), since Mid-December the market cap increased about x11, now (4.1.18) 140.099.342.556 US-Dollar and 12th December 9,772,240,000 US-Dollar?
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Alt coins are definitely easier manipulated. I've been watching the sell walls develop on vertcoin for weeks, while the price has stagnated and the coin has gone from top 30 to top 90, and one whale has accumulated over $15m worth in the matter of weeks.
The only part of your logic that I don't understand, is how does pumping alts lead to them accumulating more bitcoin?
The other side to what you don't mention is that the institutions are backing ripple because it is not decentralised, so with a bit of influence over the company they can have more control over the coin than they can with Bitcoin
Sounds like the same old rinse and repeat that most lth have been doing for years on a much larger scale. Doesn’t necessarily have to be institutions that are doing it though, could be small investmentment families with large capital. I don’t believe the media is being coordinated globally. Although CNBC and the BCash bunch seem to be in cahoots, and they definitely have the connections and the motive. Could be them accumulating alts, switching to bitcoin, dumping, buying bcash then repeat. They’ve a proven track record. And they aren’t guna stop any time soon
Interesting! https://steemit.com/bitcoin/@johncaz/staying-safe-with-bitcoin
This is very plausible, the btc dominance has been strangely low lately and is itching to come back up. This would explain a lot.
great posts, actually our groups also have the same opinions :-)