The Great Crypto Slide

Hey Influence Traders,

I hope that you had a fun and meaningful Memorial Day Weekend.

The family and I spent it with good friends.

As we hop into a short week, let me remind you one more time to join Mark Sebastian LIVE today at Noon EST today as he turns on the “Money Printing Machine.

Mark is already racking up gains — 63% in less than 24 hours last week — thanks to an overlooked shift in an obscure equity, and he’s releasing three ALL-NEW trades today.

 

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Weekend Winner

Brazilian race car driver Helio Castroneves won the Indianapolis 500. It’s his fourth victory at the Brickyard. (He’s also the 2007 Season 5 “Dancing With the Stars” champion. It’s sort of like being a D.C. AND Wall Street insider.)

Weekend Loser

Bitcoin, which finished May with one of its largest declines on record.

It’s down more than 35% at the time of this writing — to $36,840.

Has Bitcoin Run Its Course?

In short, no.

I’m still a believer — and you should be, too.

Bitcoin is a volatile trade and it’s going through a turbulent period — like it has done numerous times before.

There are some valid reasons why bitcoin faced pricing pressure in May:

      • Regulators in the U.S. and abroad voiced concerns that bitcoin could face increased regulatory oversight.
      • Federal Reserve Chairman Jerome Powell indicated that the Fed could create its own digital currency.
      • The IRS said cryptocurrency transfers over $10,000 need to be reported. 
      • Treasury Sec. Gary Gensler said that he is concerned over crypto and that they should be regulated more like the NYSE or the NASDAQ.
      • Chinese regulators took steps to limit the use of cryptocurrencies, including announcing plans to crack down on bitcoin mining.
      • A Chinese banking association warned its members to refrain from transacting in digital currencies.
      • China is also working on its own digital currency, the digital yuan. 
      • Tesla (Ticker: TSLA) reversed course and said that it would no longer accept bitcoin as payment for its vehicles, citing environmental concerns with mining.

Impact

While these are valid issues and will cause increased short-term volatility, the long-term outlook for bitcoin is strong.

Bitcoin is a store of value like other commodities and is attractive because of its limited (21 million coin) supply.

The granddaddy of crypto has been around for more than a decade. but its mass adoption has been slow — and it won’t pick up real steam until more institutions jump on the bitcoin train.

Look what happened after MicroStrategy Inc. (Ticker: MSTR) invested $2.2 billion in bitcoin and TSLA put $1.5 billion in …

Bitcoin exploded as people flocked in and drove the price up to nearly $65,000 a coin.

But for more institutions to feel comfortable getting on board, some oversight will be needed, so I don’t view recent comments by regulators as worrisome.

Big institutions like smooth-running, properly functioning exchanges that they can trust with large transactions.

They also are under pressure to address know-your-client and anti-money-laundering issues. Those have been a concern for bitcoin that some level of regulation or lawmaking could alleviate.

The IRS can always cause problems if they tax bitcoin transactions, because doing so will discourage people from using the coins in such a manner.

But my sources tell me that proposals on the Hill to exempt crypto transactions below certain dollar thresholds from taxation are gaining traction.

And, finally, what if central banks launch their own currencies? Well, that’s just more competition from other coins that will also give people the confidence to adopt crypto in their daily lives.

They are not bitcoin killers.

Cutting Through the Noise for You.

Frank

 

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