Bitcoin’s Going to the Moon 🌕
The only question is when
The following fact isn’t necessarily the reason why the value of Bitcoin has risen 16% against the U.S. dollar in the last eight days, but it’s crucial to the broader context — bear in mind there will only ever be 21 million bitcoin:
🌑🌒🌓🌔🌕🌖🌗🌘🌑
Do Kwon has put his sats where his mouth is.
The Terra Labs co-founder has faced constant questions about the sustainability of their algorithmic stablecoins, which rely on burning their native coin, LUNA, to keep their values balanced. Critics think it resembles a ponzi scheme, and that if the value of Terra’s dollar-pegged coin, UST, drops too far below $1.00, that it will enter a “death spiral” and take LUNA with it.
On March 11, Kwon tweeted that Terra would burn 12 million LUNA, or about $1.2 billion, to shore up UST’s reserves:
But on March 13, when Twitter user Sensei Algod issued a million-dollar challenge that LUNA would be worth less in a year’s time — and @’ed Kwon — well, Do took that personally.
Unbelievably, the following morning another Crypto-Twitter degen, @GiganticRebirth, offered to tack on an extra zero to the bet — and Kwon called that order of magnitude, too.
The terms of the bet are straightforward: either LUNA is above $88 on March 13, 2023 or Kwon is out $11 million. But the 30-year old didn’t make a Forbes “30 Under 30” list for no reason. He has an A up his sleeve, or rather a ₿: Terra announced it is going to buy $10 billion of the king crypto, in effect putting UST on the Bitcoin standard.
And they’ve already plunked two buy orders down in $125 million chunks, which makes it obvious which wallet is theirs.
If the average price Terra pays for BTC is $47,619.05, then $10 billion worth is about 210,000 coins, or 1% of all that will ever be minted. It’s not exactly cornering the market, as on-chain analyst Willy Woo notes — but it’s enough to wag the dog:
A high volume of shorts came in over the weekend, but they got rekt to the tune of $225 million during an epic squeeze, according to Coinglass:
To add insult to injury, Kwon got downright meme:
This is no sh*tcoin pump and dump, obviously — Kwon has a bet to win, and it’s looking good so far with LUNA at all-time highs. But an active alpha-whale disrupts the choppy waters Bitcoin has spent the last two months churning. As fish FOMO in, eight straight green candles have pushed BTC to 2022 highs, washing away all of January’s red.
And if some traders are to be believed, sellers are scared:
But there’s no guarantee that it’s smooth sailing from here on out. Technical analysis suggests that BTC might meet resistance near its 200-day moving average around $49,000:
Natasha Che also makes the bearish case for crypto over the next few months, and it’s compelling.
But there is no bigger long-term Bitcoin bull than MicroStrategy CEO Michael Saylor. Not to be outdone by Kwon’s antics, on Tuesday the O.G. of corporate Bitcoin HODLing announced that MicroStrategy would be buying more than $200 million of bitcoin using a loan collateralized by the Scrooge McDuck vault of bitcoin they already own.
Saylor is so sure Bitcoin will go up that he’s borrowing money to buy it. This is probably smart given current interest rates on the U.S. dollar, anyway, but he explains his thinking several times in an hour-long group chat. If you don’t have that kind of time, here’s the TL;DW:
Plus, the EU is still trying to hassle crypto holders through the back door, Canada is still financially cancelling protestors, and Elizabeth Warren still thinks she knows how crypto works better than crypto creators and investors.
None of this will matter, or, if anything, the attempted tightening of governments might actually accelerate what Saylor calls the “mass exodus” to Bitcoin.
This breakout might be a fakeout, a bull trap, a dead cat bounce brought upon by a billionaire who is singlehandedly moving the needle to win a bet.
But long-term? Past 2022? 2025? 2030?
Bitcoin is going to the moon. 🌕
🌑🌒🌓🌔🌕🌖🌗🌘🌑
DISCLOSURE: I own both BTC and LUNA (wrapped), but not enough to matter.
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