If you’ve seen the financial news lately, you would have noticed a panic over Bitcoin’s latest drop, a flash crash caused by rising Israeli-Iranian hostilities. Oil prices are skyrocketing, and Bitcoin briefly hit $102,650 today. Just another day, just another reminder that it’s still a crazy world out there with crypto. Beyond the headlines and the potential "buy the dip" narrative, this event throws a spotlight on a far more fundamental question: Can true financial freedom exist without addressing the needs for security and stability on a global scale?
Freedom's Price, Security's Cost?
Bitcoin, at its core, is a revolution. A digital fuck you to corporate overlords, a voters’ tete-a-tete with financial independence. It promises unimaginable prosperity and security. It whispers of a world where people, not politicians or banks, own their money. The flash crash tells us something else. Instead, it exposes a weak underbelly, an extreme potentiality to the very geopolitical, nationalistic forces Bitcoin claims to have risen above.
Is this truly freedom, or merely a new form of dependency disguised as liberty?
Decentralization provides an irresistible temptation. This is particularly true for us folks in Accra, where the traditional financial systems often do not serve our needs and posture. A system that is as easily rattled by major international events thousands of miles away as this one is raises some serious questions. Does Bitcoin really provide a more attainable route to financial inclusion or does it just bring in different kinds of risk onto newer, more at-risk groups?
Undervalued Opportunity Or Red Flag?
Bitcoin analysts are echoing the Puell Multiple, which is in a “discount zone”, as a sign that Bitcoin is currently undervalued. Historical data suggests that Bitcoin tends to bounce back strongly after geopolitical risk events, averaging a 64.6% increase within 50 days. Many proponents believe that Bitcoin is already emerging as a hedge against global uncertainty, a digital safe haven.
Importantly, Glassnode’s data indicates that Bitcoin is now trading above important short-term cost basis levels. This suggests that the majority of holders are still in the green, likely reducing fear selling and panic moves. Supply Shock The halving’s effects on supply are perhaps the most interesting part of Bitcoin’s halving narrative.
Let's be real. This isn’t a game for the faint of heart.
Painting Bitcoin as a hedge against geopolitical risk is somewhat akin to saying a surfboard can shield against a tsunami. Both are just not good or workable answers honestly. It could do a great deal of good there, but it’s always subject to the whim of forces a world away from its intent.
What’s in it for the average retail investor who puts their savings to work? Or they could see it go down the drain in an overnight flash crash, set off by unforeseen circumstances entirely outside of their control. Where is their safety net? Where is the responsible innovation that provides them the regularity from such risk?
This isn't about stifling innovation. Bitcoin and the blockchain technology it unleashed are significant. It’s about understanding that absolute freedom without accountability would be chaos.
Balancing Innovation With Stability's Need
We need to finally level with ourselves about the “needs” side of that equation. The need for stable governance, responsible regulation, and a safety net for those who might be negatively impacted by Bitcoin's volatility. That doesn’t entail drowning the tech in bureaucratic red tape. It requires putting in place a structure that fosters new ideas and technologies, but reduces risk.
Look to a tiered system of regulation. This would place investments made and people participating under increasing amounts of scrutiny and lack of protection. Perhaps greater emphasis on financial literacy and education, to equip individuals with the knowledge they need to make informed decisions.
The future of Bitcoin, and future of decentralized finance as a whole, will rely on our capacity to achieve this equilibrium. It demands an international interdialog between developing and developed governments, regulators, and the Bitcoin community as a whole. This discussion will focus on the inherent tension between freedom and security. We’re working to build a system that works for all Americans, not just those at the top. Only then can Bitcoin live up to its aspiration of delivering a more equal and inclusive financial system.
Remember, folks, this isn't investment advice. Do your own research. More importantly, start to think as critically as possible about the overall scope. Consider the type of future we want to build and how Bitcoin fits into that. This flash crash is a wake-up call. Let's not waste it.
Remember, folks, this isn't investment advice. Do your own research. But more importantly, think critically about the bigger picture. Think about the kind of world we want to create, and the role that Bitcoin can play in it. This flash crash is a wake-up call. Let's not waste it.
