Industry News Media chaos as Bitcoin price Falls Down Once Again

Media chaos as Bitcoin price Falls Down Once Again

November 26, 2019

In recent days the world once again witnessed bitcoin price taking a serious fall in terms of value. This time, as several times before, the price went down by a couple of thousand dollars in the space of just a few days. Expectedly, the reaction to this fall has been one of complete and utter chaos when it comes to the mainstream media.

In some ways, this is to be expected when the previous track record of most global Media organization is taken into consideration. Yet there is also once again that sense that divided public is being served so much information covering almost every possible angle including contradictory ones, that it would be practically impossible for anyone to make up their minds about cryptocurrencies in moments like this.

Still, even in this chaotic environment, very data is flowing each and every way there are still some important patterns that are revealing themselves in the way traditional systems are coping and processing the fact that cryptocurrencies just refused to go away and die. The slump of late 2019 is probably going to be another one of those moments in history where that weird connection between traditional news outlets and crypto developments once again indirectly clashed in front of the eyes of the road.

Big Movements

No one can deny that things are very much in motion in the cryptocurrency world. Several things added to it. First, there is a growing debate about the possibility of central banks giving out their digital currencies. Now, in just several days, bitcoin took a nosedive that wiped out almost one-third of its value. There is also a strong possibility that bitcoin did not find its bottom by any means in this most recent bear market.

During its one-decade long life as a trading asset, bitcoin usually moved in synchronization with equities. This is why the recent crypto movement is so disconcerting to many analysts. An additional question is whether or not it is now the time to be risk-averse and pass the chance to buy the cryptocurrency at a much lower price or is this the very moment to avoid any risk and see where the market takes itself.

Adding to that the notion that some present as bitcoin being a safe place for hedge funds and a way to build a wall against drops in other fiat currencies. For those individuals, the principles of cryptocurrencies are not as important as the fact that right now, bitcoin servers the function of more or less being a digital gold.

Safe Havens

No one can tell for sure if crypto is or is not a safe haven for situations like the 2015 devaluation of the Chinese yuan. Some investors managed to save their funds using bitcoin but others were not that lucky. Also, those who did transform their fiat funds into bitcoin were left with the question of when and how should they turn their crypto funds back into fiat.

Here, the fact that bitcoin and other cryptocurrencies are not actively used in the role of means of exchange plays an important part. Yes, some retailers do accept them, but in general, in spite of the efforts of startups like Lolie, many ordinary individuals simply do not have access to them. As a hedge, they might be a great option as a last resort and useful in a situation where a lot of money would be otherwise certainly lost.

But, using crypto as an actual and regular hedge fund in a functioning economic system has too many drawbacks to be considered by the mainstream as a long-term viable alternative. This might change in the future, but for now, the massive hedge concept is nowhere near reality. But, like clockwork, mainstream media will report that people are seeking bitcoin in places like Hong Kong, Venezuela or even China in the midst of economic changes and restrictions.

Adoption Issues

There are millions of cryptocurrency users all over the world. These encompass everyone from ordinary citizens to esports players and crypto enthusiasts. But, the adoption numbers are still very low when compared to regular currencies, even those coming from small nations. There are numerous barriers to using crypto.

Firstly, there is its volatility that makes the process of translation to fiat prices very hard, while very few regular users will switch mentally to thinking about crypto as the main source of value. Then, there are tech hurdles like opening digital wallets and using them on a regular basis. However, this has not stopped mainstream media regularly reporting that people are moving their fiat funds into cryptocurrencies for any number of reasons.

These might be a desire to invest, curiosity or something else, but following that logic, there should be hundreds of millions of crypto users, having in mind that most would not have an imperative to drop a crypto wallet once they set it up. Nothing of the sorts has not happened so far and the trickle of crypto adopters, no matter if they start using bitcoin or some other cryptocurrency, remains pretty much the same over the years.

Old Gauges for New Systems

The problem with each of these media frenzies and the fallout that follows them remains the same year and year out. Mainstream news outlets are trying to gauge crypto using traditional factors and more importantly, the traditional way of thinking in a particular economic system.

This leaves many pundits and analysts in a spot where they either glorify the potential of bitcoin or lament (or be happy about) its certain and immediate downfall. The truth is that both of these options are simply not true and will not become reality anytime in the foreseeable future.

Cryptocurrencies are not a bubble that can simply burst but they are also definitely not a bulletproof safe haven or a replacement for fiat currencies. They will not take over the traditional banking and economic system, but they will also not go gently into the night. During the current bear market, mainstream media would do well to try and find a new mentality of perceiving crypto events.

Source: Forbes