How to stop price declines? How to trigger increases?

New City Trader
3 min readMay 17, 2023

The FTX scandal caused a real storm around the world and strong declines on BTC. Recently, the markets have returned to the upside, however, after a close look, the upside is not as strong as the previous declines. The question of whether this is a real reversal or just a temporary upward correction remains open.

All the more reason to look at the macro factors that cause price changes on BTC and the factors that may lead to further declines. Because, unfortunately, the latter are quite numerous.

For now, I don’t have any good news, we have before us potentially three groups of problems threaten the price of Bitcoin. In the following article, I will first discuss the four most dangerous problems I see, and then show how to solve them (or at least in what direction to look for a solution) so that price increases return. I believe that the overall goal of action taken should be to bring BTC price increases to levels of 500,000+, a rallying target that is very ambitious and requires the activation of many strong mechanisms.

Problems #1 and #2: Negative news tsunami multiplied by two

The events surrounding FTX have exposed many of the weaknesses and pathologies that exist in the crypto industry. Many companies that held their money in FTX are at risk, some of them likely to go bankrupt. Each of these developments is reflected immediately in Bitcoin price declines.

The keywords that will appear are: fraud, embezzlement, theft of billions of dollars, buying residences with customers’ money. This kind of news usually scares retail investors, there is an outflow of small capital from the market.

Currently there have been increases, but… ahead is the trial of Elon Musk, the richest man in the world. The Musk — Johnson trial over the value of Doge will attract media attention from around the world. Many journalists will carefully read the two lawsuits (there are already two, a basic one and an extended one) and find dozens of quotes from various influential figures. All of them are negative.

Well-known investors, heads of large funds, directors of central banks, there is even a Nobel laureate in economics. They will find many negative keywords: financial pyramid, Bitcoin and cryptocurrencies are worthless, scam, fraud, Ponzi scheme, speculative bubble about to burst. Such content will poison news cycles for weeks.

Again.

In this wave of negative information, opponents of cryptocurrencies will become active again. Particularly dangerous are politicians, heads of central banks, for whom bitcoin and crypto are competitors because they are beyond their control. As a result, this will be a good breeding ground for the most dangerous phenomenon for the entire industry: negative regulations, limiting or completely banning Bitcoin and others.

Bitcoin’s ban is currently most feasible in the US and Canada

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