China Is Cracking Down On Bitcoin Again? Is It Time To BUY? Or Sell?

China is again cracking down on Bitcoin in an effort to slow the advancement of anonymity on the web. In April reports of a China Central bank cryptocurrency came out, the Wall Street Journal reported here. So why is China hurting crypto right now? China is urging its banks and companies to not accept cryptocurrency for payment! Even though the Chinese Central Bank has its own Cryptocurrency, it does not accept independent cryptos with no allegiance.

Cryptos are designed to be assets and currencies that are independent, anonymous, and separate from an organized banking system, this is something that a highly censored and controlled society like China can not allow. Bitcoin is dropping because China is basically limiting Bitcoins' future growth potential, over 1 Billion people will not be owning or trading Bitcoin. It also looks bad for cryptos legitimacy if a major country like China is shutting it down, who is next, maybe Russia?

So What NOW?

If we simply take a long-term view and think about crypto as a growing asset like a company or stock, it just received a massive hit. The legitimacy of the product is in question and the entire market (altcoins) is in flux. This scenario is one that is as old as money. It happens on the stock market every day, but Media exacerbates the crypto issue by framing the crypto market as a playing field for kids that throw real money at digital lego bricks. Social media and Crypto personalities are not helping, like the "One Man Doge Army Guy" guy that stormed the stage in Crypto Miami 2021. Hilarious. But, just not something tight suited investors look for in a finance conference.

So, Buy?

We will be testing the $30k support and if we break through we will see how far we can really fall. Dollar-cost averaging is the way to go. Buying on an upswing like last week is discouraged, the moments where there is most uncertainty are often the best time to add. I actually think people are overselling the China news, hardly any company anywhere accepts Bitcoin as payment. If you know any let me know but for the rest of us the payment route was always in question and that risk is already priced in. Think about it, you can't pay with a stock right? Can I one day get a Tesla with one share of Berkshire Hathaway (BRK A) and get some change? I doubt it, and I don't want to, I rather sell it and use whatever is accepted as payment, currently, it's the US Dollar.

Thanks for reading,

The Punkrock Capitalist