Is Bitcoin really going to hit $8k?!
Today we talk about regulators, some non-sense predictions, Stepn P2E app
gm frens 🤓, happy Tuesday.
It has ben a while since we are sitting at $1.26 trillion cryptocurrency market cap with BTC being approximately at the same levels they were throughout the week.
Okay, let’s talk a bit about Regulators and non-sense predictions.
We have people like Christine Lagarde (European Central Bank President) who when asked about crypto, said “My very humble assessment is that it is worth nothing,” because “There is no underlying asset to act as an anchor of safety.” Although the intention is “to protect the unexperienced investors”, Christine represents a regulator. And that’s what regulators do. Anything that takes their power out of their hands, they are supposed to be against it.
If there is no underlying asset for crypto, then someone needs to explain me the definition of fiat currency and what is the underlying asset for it. A quick google search and tadam:
The value of fiat money is derived from the relationship between supply and demand and the stability of the issuing government, rather than the worth of a commodity backing it. - Investopedia
Gold Standard is long gone, there is no underlying asset for fiat currency, everything is managed between supply and demand. Yet, “crypto is worth nothing because there is no underlying asset”. You be the judge on this! The whole point of web3 space is being fully decentralized (i.e. not regulated, managed by a DAO), yet we have regulators who are fully towards regulating web3 space. I would not be surprised even if there is a push from regulators to damage the reputation of crypto as much as they can.
Then, we have people like Scott Minerd who think that Bitcoin can go as low as $8k. Okay, hold on a sec, let’s step back. Scott who? Good question. Before we panic sell based on his prediction let’s check who Scott is and what he does for a living.
Scott is Guggenheim cofounder and CIO, asset management and investing company with $323 billion AUM (assets under management). Okay, this adds some credibility to him. He is a finance bro after all. Is he a FUD then?! Probably not, he got exposure on crypto himself. He has proven himself wrong with predictions over and over though.
His rationale is that "When you break below $30,000 consistently, $8,000 is the ultimate bottom, so I think we have a lot more room to the downside, especially with the Fed being restrictive,".
He is known for extreme predictions and way off of reality. I have been involved in crypto space since 2015. I can tell you that since then, on almost daily basis we had finance bros who came with absurd predictions about crypto pricing.
Back in Dec 2020, Scott argued that Bitcoin should be worth $400k. Bitcoin was sitting at around $40k then. One more zero added. Zero has no value..so..
Then in February 2021 he says that Bitcoin should be worth $600k. A month later, Bitcoin went down from $63k to $33k.
That’s his credibility on predictions.
What’s all the hype about StepN?
In one of our previous newsletters, we talked about Solana based NFTs who are getting attraction lately. StepN is among the most popular projects built in Solana.
Okay, so what is StepN about? StepN is an app that lets you earn tokens by walking and running. A ‘move-to-earn’ app, what people call them. There are around 3 million active monthly users of the app. Their current market cap is around $800 million.
It generates ~ $5 million in net profit from trading fees a day and earning up to $100 million every month. It has its own merits.
Lot of critics have argued about the sustainability of such models, to the point where they compare P2E (Play to Earn) pyramid Ponzi schemes. Which kinda makes sense. It always relies on new comers.
In order for you to start earning tokens, you need to buy “virtual shoes” which currently cost 12 SOL (~$600). Those are the cheapest, you can always buy more expensive ones which in turn will earn you more tokens. Of course, there are restrictions in place (such as you not being able to run more than once a day) where you can’t run all the time, it is restricted on how much you can run while earning tokens. Based on what users said, it will take approximately a month for you to recover your initial investment, assuming you will be running on daily basis.
The way the increase their value of the game is through their dual-token system. They have GST as a utility coin which they use it as a currency to buy shoes. When price gets high, StepN will ask players to burn their governance coin called GMT to mint new shoes. By doing so, GST supply increases, which leads to a sell-off and thus bringing down the cost of minting new shoes.
All this, thanks to new users coming to the app. If this is not all hype, then most likely we will see this go downhill pretty quickly.