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Jason Deane

A ray of hope after a week of crypto disaster?

Published almost 2 years ago • 2 min read

Dear Reader

Welcome to your Bitcoin and Global Finance Newsletter for week ending 13th May 2022!

It’s another Friday and I find myself, yet again, writing primarily about doom and gloom in the world of finance, logistics and markets. Is anywhere safe right now?

On the face of it, no.

Yet there are some solid green candles on my screens this morning – a colour now so unusual I did a classic cartoon style double take as I shuffled into my office with my first coffee in hand. There is, it appears, the tiniest bit of optimism hanging in the air.

In part, this could be because the likely catalyst for the collapse in the crypto markets has now been fully laid bare. Much has been written about the UST and Luna debacle and no more needs to be added here (if you want a very neat explanation check this out), but getting to the bottom of any of these things often acts as a cleansing process for markets generally. It creates a sort of reset and allows a new normal to emerge.

That said, almost all markets across all categories show those welcome green numbers this morning, meaning that something else must be going on. Did we simply overdo it in an emotional panic and are now, collectively, setting new positions with a calmer disposition?

Maybe. But it’s too early to say for sure.

What we can be certain about is that the outlook generally doesn’t seem to be getting any better.

Russia’s dismal military performance continues to humiliate Putin internationally on a level that must make him furious. Finland’s decision to join NATO, almost certainly to be followed by Sweden, has provoked a new round of threatening rhetoric from the Kremlin that, well, sounds like a toddler having a meltdown.

The trouble is that this toddler still has access to substantial military might through sheer numbers (not to mention nuclear weapons) and controls enough of the world’s natural resources to cause real problems for European economies. And you just know he’ll relish the thought of damaging “unfriendly countries”. This is NOT going to be over anytime soon.

That means gas and oil prices probably have further to rise, but food supplies, especially grains and oils, are also likely to be seriously affected. And, as inflation creeps ever higher, the cost of living is becoming a real, genuine problem for ordinary folk, as I wrote about here recently.

But difficult scenarios also create opportunities. Almost all European countries have accelerated their renewable energy programs to wean themselves off petrochemicals, something that is incredibly timely given the World Meteorological Association’s recent stark warning of temperature rises. Perhaps some good will come of this mess after all.

In the meantime, Bitcoin continues to process block after block entirely uncaring of the mess we make for ourselves, while development and adoption continue unabated. At times like this, it’s worth remembering why Bitcoin is SO different from literally every other coin out there, and, while it is still being traded as a ‘risk on’ asset, I wonder how long that will be the case?

Have a great weekend!

JD​

PS If you were affected by the events in the crypto markets this week - and I know from my DMs that many were - please don't hesitate to reach out for help and support, either from me, one of my colleagues or one of the fabulous organizations out there. Seriously.

Want to learn more about what’s going on in our global financial system and how Bitcoin fits into it? Come to my next free webinar on Wednesday May 25 at 6pm to find out, ask any questions, and grab some free Bitcoin*. Click here to register.

*18+, UK resident, new to Luno only

Jason Deane

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