Bitcoin subreddit hits 2M subscribers following GameStop controversy

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US Lawmaker Likes Bitcoin — Urges Policymakers to Embrace Innovation in Regulation

US Lawmaker Likes Bitcoin — Urges Policymakers to Embrace Innovation in Regulation

U.S. Representative Patrick McHenry is pro-bitcoin. He is now hosting the Bitcoin whitepaper on his official congressional website and has called on other lawmakers to embrace innovation like Bitcoin. He believes that the cryptocurrency is unstoppable and governments cannot kill it.

Pro-Bitcoin US Lawmakers

A growing number of U.S. lawmakers have recently spoken in support of Bitcoin. Among them is Congressman Patrick McHenry from the state of North Carolina. On Friday, he talked on CNBC’s Squawk Box about how to approach regulation after last week’s market swings. “You can’t put technology back in the box. Innovation is here. We have to embrace. We have to broaden access to our markets, we have to broaden access to our financial products,” he said.

McHenry has long been a Bitcoin advocate. Last week, when the lawyer of the self-proclaimed Satoshi Nakamoto, Craig Wright, threatened to sue a few website owners for hosting the open-source Bitcoin whitepaper on their websites, McHenry uploaded the document onto his official congressional website. He then tweeted:

Policymakers should be on the side of innovation and ingenuity, which are vital to American competitiveness. I hope others in US govt join me. #Bitcoin

Another pro-Bitcoin U.S. politician is Miami Mayor Francis Suarez. He uploaded the Bitcoin whitepaper onto the Miami city website following the Craig Wright lawsuit threat. “The city of Miami believes in Bitcoin and I’m working day and night to turn Miami into a hub for crypto innovation. Proud to say Miami is the first municipal government to host Satoshi’s White Paper on government site,” Suarez wrote Wednesday.

Praising Suarez’s efforts in promoting Bitcoin and innovation, McHenry replied: “Impressed by what you are doing in Miami, Mayor Francis Suarez. I hope more policymakers will join us to support American innovation.”

Earlier this month, Suarez discussed putting some of Miami city’s treasury reserves in BTC and said he is working to allow payments of city services in the cryptocurrency.

McHenry has said that bitcoin is unstoppable and governments should not attempt to ban it. “The world that Satoshi Nakamoto, author of the Bitcoin whitepaper, envisioned and others are building is an unstoppable force,” he said during a hearing of the Committee on Financial Services in July 2019. “We should not attempt to deter this innovation, and governments cannot stop this innovation and those that have tried have already failed.” McHenry additionally emphasized: “Due to the nature of the technology of Bitcoin, governments cannot kill it, nor should they.”

Last week, McHenry commented on Joe Biden’s pick for the new chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler. He believes that the MIT blockchain professor’s receptiveness to new financial technologies and cryptocurrency is positive.

The U.S. Senate also has a vocal bitcoin advocate. Sen. Cynthia Lummis from Wyoming has vowed to help her colleagues in Congress understand that bitcoin is a great store of value.

What do you think of pro-bitcoin U.S. politicians? Let us know in the comments section below.

Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Hedge fund behind shorting GameStop reports 53% loss in January

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Crypto Long & Short: GameStop, Dogecoin and a New Market Paradigm

It’s hard to do justice to the symbolism and significance of the Reddit-Robinhood-GameStop drama of this past week.

That’s not to say it hasn’t been overblown in some quarters. I’ve heard it compared to the Capitol riots – no, that was sedition, this is rebellion, very different. I’ve seen calls for the regulators to step in and shut down retail trading platforms, even though it’s not clear a crime has been committed. And I’ve read takes painting the leaders of this charge as “misfits.” That condescension itself is part of the problem.

The protagonists are not misfits – they are retail investors flexing their collective muscle, the very same muscle the “establishment” encouraged them to develop.

You’re reading Crypto Long & Short, a newsletter that looks closely at the forces driving cryptocurrency markets. Authored by CoinDesk’s head of research, Noelle Acheson, it goes out every Sunday and offers a recap of the week – with insights and analysis – from a professional investor’s point of view. You can subscribe here.

Retail investors were encouraged to invest their savings in the stock market. They were offered mobile apps that made it easy. They were bombarded with advice and ideas from mainstream media. They were given money to spend. And low yields pushed them up the risk curve.

Making way

While the attention has been focused on a handful of stocks that have seen astronomical gains on the back of retail enthusiasm, the origin and the result (whatever that ends up being) have a lot to do with the crypto markets.

We’re not trying to steal anyone’s thunder. The WallStreetBets channel that galvanized the troops and led the charge did not welcome crypto traders or even chatter. Their drivers are not decentralization or fair access – rather, they seem motivated by glee at their newfound power, and anger.

The anger runs deep. The 139% short position against GameStop signaled heavy hedge fund involvement – but this was a trigger, not a cause. This rebellion feels like an expression of pent-up frustration at the skewed rules of capital markets that entrench the power of the “elite,” combined with residual resentment over the 2008 bailouts, the lack of market transparency and a long list of generational grievances.  

A similar “old” vs “new” mindset drives the crypto markets.

Many of us were drawn to bitcoin out of concern for the impact on individual prosperity from defensive decisions taken by entrenched interests. Others were attracted to the concept of decentralized finance as an antidote to the potential damage done by consolidated power. And there’s the strong vote for financial sovereignty and commercial freedom.

All of us watched how traditional finance initially rejected the notion that a programmable token could ever have value or that code could produce yield. The success of crypto markets has forced much of the “old guard” to gradually recognize that things are changing. The events of this week will no doubt drive home that message.

What’s more, the very same platforms that sold themselves on the democratization of finance ended up restricting users’ access to certain trades this week, with the market in full swing. Can you think of a more public spotlight on the vulnerabilities inherent in the current market infrastructure? Google Trends shows that searches for “defi” (short for decentralized finance) are growing.

There is a risk that the new administration will use the retail investor rebellion as an excuse to over-regulate. Yet popular sentiment seems to be with the rebels, as legislators are no doubt aware (I don’t recall ever seeing Ted Cruz agree with Alexandria Ocasio-Cortez before).

What’s more, the nomination of Gary Gensler, who is both knowledgeable and generally supportive of crypto markets, to the post of Chairman of the U.S. Securities and Exchange Commission could hint at the beginning of structural reform in favor of more “democratic” access.

It could also move the needle on investor understanding of some of the underlying qualities of blockchain-based assets and their markets. True, access to these markets has some hurdles, such as jurisdiction and familiarity with technology. But investor choice and user experience has never been better, and, with some large market infrastructure players intending to go public this year, will continue to improve.

Back to basics

It’s not just market structure that is likely to be re-examined as a result of this week’s events. Market understanding needs a rethink, too. This also has a lot to do with crypto assets.

I lost count this week of the number of mainstream commentators that spluttered about “fundamentals,” and how the price shouldn’t move so much when GameStop’s situation hasn’t changed. They’re wrong – whether the stock is currently overvalued or not (I have no opinion on that), the company’s situation and fundamentals have changed.

One, there’s the massive publicity. Two, aside from the potential future revenue from selling games, there is probably a merchandising opportunity through branded mugs and pitchforks. Three, there’s a groundswell of support for the share price – only this is not traditionally considered worthy of consideration in asset evaluation. It should be.

Investopedia defines business fundamentals as “information such as profitability, revenue, assets, liabilities, and growth potential.” I would add to that list “public support.” Critics of this idea will say that sentiment is ephemeral, impractical to estimate and therefore impossible to value, while traditional fundamentals are tangible and can be discounted.

These days, though, even the tangible ones are mere estimates, which – as we have seen – can vary wildly and be rendered useless by unforeseen events. We have also seen how sentiment moves markets, and not just on a short-term basis. No analyst can reasonably ignore its power, and insisting that portfolio decisions “stick to the basics” is assuming that things will go back to the way they were 50 years ago when investors parked their money in safe securities and forgot about them until retirement.  

The power unleashed this week may remind some of us oldies of 1999, when market fever crested before crashing. But back then we didn’t have the power of social media, a generation stuck indoors and helicopter money from the government. We also weren’t looking at an unprecedented level of social dislocation, loss of trust in institutions and belief in the strength of community. Today’s markets may turn south at any moment, and when they do, it is likely to be ugly. But, in contrast to the turn of the century, retail participation is unlikely to fade – this cultural shift is about more than making money.

The new-found power of retail investors has showed that sentiment not only trumps earnings forecasts, it can impact them. The very same investors piling into the stock are the same demographic that GameStop’s future business will target. The collective power showed that market mood is a fundamental characteristic of markets, now more than ever. Some of the price jumps this week may have been driven by hedge funds who understand this and were placing buy orders accordingly.

While volatility is likely to eventually quieten down and business analysis should always have a significant role in investment decisions, we can no longer say that sentiment isn’t a fundamental component of an asset’s price outlook.

This is especially relevant with crypto assets. Critics have often accused bitcoin of having no “fundamental value,” by which they mean no cash flow, balance sheet or potential earnings growth. True, it doesn’t have these things, but it does have widespread belief in its utility, monetary policy and eventual adoption by an even broader community. That faith should be considered a fundamental characteristic, as it is now obvious it drives price appreciation.

Bitcoin is not the only clear example of that. This week saw the price of Dogecoin (DOGE) at one stage surge ten-fold (up 500% at time of writing), briefly pushing the cryptocurrency into the list of top 10 crypto assets by market capitalization. DOGE doesn’t do anything special. It has a cute dog as its logo. Its founder disavowed the project ages ago. Some people have hyped it as a joke which then became part of its narrative – in other words, its unpretentious lack of fundamentals has become part of its value. We may deride people who put savings into a purely sentiment-driven asset – but that sentiment has kept DOGE alive for over six years now, and has attracted a smattering of high-profile followers.

New language

As an analyst trained in “old school” valuations and portfolio allocation techniques, I understand the reluctance to let go of comfortable heuristics – personally, I miss discounted cash flows, so nice and clean. But as market components and participants change, so must market analysis. Does anyone even remember when last “value stocks” were in favor?

Crypto markets have for some time been pushing the boundaries of what “value” means. The new generation of investors is showing us that old rules need re-examining.

They are also permanently blurring the boundaries between institutional “smart money” and retail “dumb money.” What’s more, they are showing that reform can be initiated by those that previously have had little influence on how profits are made.

This is the crypto market origin and ethos in a nutshell: new rules for a new type of investor. The crypto asset market was born in the retail world and cultivated from the ground up. It attracts investors looking for an alternative to the traditional system. It has given birth to new metrics and valuation paradigms.

All of us who work in this industry have watched this week’s power shift with the feeling that what we’ve been expecting is finally starting to happen: a new type of investor is insisting on new rules and a new language, and mainstream markets are starting to take note. This new type of investor – be they angry at elites and unequal rules, fascinated by the emergence of a new type of asset, or both – will force a rewrite of some long-established rules of investment, and in so doing, push the philosophy behind the term “value” towards a more flexible definition for our changing times.

CHAIN LINKS

Ray Dalio, founder of Bridgewater Associates, the world’s largest hedge fund, published a document laying out his thoughts on bitcoin. This is remarkable, given that not long ago he publicly expressed skepticism that it would succeed.

  • “I believe Bitcoin is one hell of an invention.”
  • “There aren’t many alternative gold-like assets at this time of rising need for them.”
  • “It seems to me that Bitcoin has succeeded in crossing the line from being a highly speculative idea that could well not be around in short order to probably being around and probably having some value in the future.”
  • “The new paradigm that we are living in, with many government bonds no longer offering the same return or diversification characteristics and currencies facing greater risk of depreciation, could propel development of alternative storeholds of wealth faster than might otherwise have been the case.”
  • “So far, Bitcoin’s ability to offer some diversification benefit seems more theoretical than realized.”

Elon Musk now has “bitcoin” and its logo in his Twitter bio, and flagged this with the tweet: “In retrospect, it was inevitable.”  

Scott Minerd, chief investment officer of Guggenheim Partners, told Bloomberg television this week that he does not believe that bitcoin’s institutional investor base is “big enough” or “deep enough” to justify its current valuation.

In an interview with Yahoo Finance, ARK Investment Management CEO Cathie Wood revealed that recent conversations with large companies leads her to believe that more will follow Square’s lead and allocate a portion of their treasury to bitcoin. She also said at this week’s ETF Big Ideas Event that she doubts that a bitcoin ETF will be approved until the asset’s market cap hits $2 trillion.

Bank of Singapore, a private banking arm of OCBC Bank (the second largest bank in Southest Asia by total assets), said in a research note that cryptocurrencies have the potential to partially replace gold as a store of value if they can overcome the hurdles high volatility, reputational risk and lack of regulatory acceptance.

According to sources, some of the largest university endowment funds in the U.S., including Harvard, Yale, Brown and the University of Michigan, have been quietly buying cryptocurrency since 2019. TAKEAWAY: This is notable, given endowments’ traditionally conservative investor profile. The allocations are most likely relatively small, but even so, the AUM of college endowments is in the hundreds of billions of dollars – small can go a long way. It will also be worth keeping an eye on endowment activism – some universities, especially Harvard, have come under criticism for their investment in fossil fuel companies. Bitcoin’s (misconstrued) reputation as bad for the climate might attract their attention.

According to Genesis Capital’s latest quarterly report, its total volume of active loans outstanding increased by over 80% in Q4, to $3.8 billion. Loan originations increased by 46% to $7.6 billion, the average loan size doubled from $2 million to $4 million, and the average loan size for first-time lenders increased from $0.6 million to $3.2 million. TAKEAWAY: These growth figures highlight the growing awareness amongst institutional investors of the yields possible in crypto lending, and as long as yields remain low in traditional markets, growth should continue to be strong. This supports healthy liquidity in crypto markets, which in turn should help strengthen market infrastructure and could gradually mitigate asset volatility. (Note: Genesis Capital is owned by DCG, also parent of CoinDesk.)

On business intelligence company MicroStrategy’s (MSTR) latest earnings call, CEO Michael Saylor pledged to keep pouring the business intelligence company’s excess cash into bitcoin, telling investors his team will also “explore various approaches” for additional buys. TAKEAWAY: They really are working on becoming a bitcoin ETF.

Cryptocurrency mining company Marathon Patent Group (MARA) bought $150 million in bitcoin during the crypto asset’s recent price rout. TAKEAWAY: Here we have a bitcoin mining company buying BTC on the open market in order to become even more of a “pure play” for the asset. And yet a bitcoin ETF is still deemed too risky.

The city of Miami on Wednesday uploaded a copy of the Bitcoin white paper to its website, joining a growing chorus of governments and companies now hosting bitcoin’s original blueprint. TAKEAWAY: A U.S. municipal government website is hosting the Bitcoin white paper. Let that sink in.

Over the past few months Grayscale Investments (owned by DCG, also parent of CoinDesk) has filed to register over 10 new trusts based on smaller cap crypto assets such as aave, chainlink, polkadot and others. TAKEAWAY: Grayscale currently manages a suite of market-leading trusts, including GBTC (bitcoin) and ETHE (ethereum), as well as some smaller ones based on horizen, litecoin, stellar and others. While Grayscale is not necessarily signaling intention to act on these new filings, they do hint at a growing breadth of choice for institutional investors in the months ahead.

Canadian investment firm Ninepoint Partners’ bitcoin fund (BITC.U and BITC.UN) started trading this week, having completed a C$230 million (US$180 million) initial public offering on the Toronto Stock Exchange. TAKEAWAY: The considerable amount raised not only makes this Canada’s largest new crypto fund and the second in two months (the CI Galaxy Bitcoin Fund started trading on the TSX after a $72 million public raise in December), it also points to significant and growing demand from Canadian investors.

India’s parliament is considering a government-backed bill that would ban “private” cryptocurrencies and provide a framework for creating an official Reserve Bank of India digital currency. TAKEAWAY: The potential impact of the proposed bill is as yet unclear – for instance, what does it mean by “private” cryptocurrency? Bitcoin and others are public cryptocurrencies. Nevertheless, this would set a worrying precedent. It would also be an interesting case study on how effective government bans of crypto assets are.

If you’re looking for some bird’s-eye perspective on monthly market performance, my colleague Shuai Hao put together this table of returns. If you squint, you can see that summer months are traditionally weaker, and the end of the year is usually stronger. Furthermore, we can see that volatility has declined a bit (fewer dark colors of either shade).

Popular Cryptocurrency Trader Ben Armstrong Names His Top Altcoin For the Year

Top crypto trader and market analyst Ben Armstrong has given his top ten list for altcoins in 2021. 

In a recent YouTube update, Armstrong told his 327,000 subscribers the market is moving to short bitcoin while going long on a selection of top altcoins.

The popular trader touted the governance token Uniswap (UNI) as one of his premier choices, telling investors the altcoin could “explode” with the addition of new trading features such as limit orders. 

Armstrong went on to list the lending platform Maker (MKR), saying the coin was poised to benefit from the explosion in decentralized finance (DeF). The YouTube influencer was also bullish on Ren (REN), a protocol for transferring crypto-assets between blockchains. Armstrong noted Ren’s positive performance against bitcoin, calling it a good measure of investor interest. 

In addition, he highlighted the zkRollup exchange and payment protocol Loopring (LRC). 

Armstrong said of the project, 

[LRC] will help the space by leaving opportunities for other chains and for Layer 2 DeFi solutions for Ethereum like Loopring to come to the forefront, and obviously hamper it due to the issues that extremely high gas fees create for the smaller trader. It raises the barrier to entry in the DeFi game, and projects like Loopring are trying to solve that.

The trader rounded out his selections with HedgeTrade (HEDGE), privacy coin Horizon (ZEN) and decentralized public network Hedera Hashgraph (HBAR). His top three consisted of Nano (NANO), which he called the fastest cryptocurrency on the market, as well as DeFi platform Polkadot (DOT) and open-source blockchain protocol Avalance (AVAX). 

Featured Image Credit: Photo via Pixabay.com

Bitcoin Bears Erase the “Elon Musk” Candle as Sellers Take Control

  • Bitcoin has witnessed some massive selling pressure throughout the past day that has erased all the gains that came about as a result of the “Elon Musk” pump a few days ago
  • The selling pressure seen has come from a combination of spot and derivatives, with investors generally going risk-off
  • It remains unclear what the cause of this could be, but it may be a combination of technical weakness as well as turbulence within the traditional market
  • One analyst is now noting that there’s a strong possibility further downside is imminent for the entire market
  • He is pointing to the cryptocurrency’s January low as the next level he is closely watching, with a bounce here potentially allowing for massive upside

Bitcoin has seen some wild price action over the past few days. It all started with Elon Musk’s endorsement of BTC, which catalyzed a massive pump towards $40,000 that has been entirely erased over the past few days.

This “FOMO” induced pump seemed to provide exit liquidity for holders looking to get out, as it was aggressively sold into.

One trader believes that this is a sign of imminent downside, as he is now pointing to the cryptocurrency’s January low as a near-term target.

Bitcoin Plunges as Bears Erase the Entire “Elon Candle” 

Earlier this week, Elon Musk changed his Twitter bio to “#Bitcoin” and commented that the change was inevitable in hindsight.

This caused Bitcoin to soar nearly $7,000 and caused nearly half a billion in short liquidations.

However, the selling pressure at these highs was significant and caused a massive rejection that has since resulted in it erasing all of the gains that came about due to Musk’s endorsement.

BTC Could Soon target Move to January Lows

One trader believes that a move to Bitcoin’s January lows could be in the cards, especially considering the multiple rejections it has posted at a key trendline.

“Bears have a clear invalidation from here imo. Easy to flip long if wrong,” he gravely noted while pointing to the below chart.

Bitcoin

Image Courtesy of TraderSZ. Source: BTCUSD on TradingView.

Despite this sentiment, there seems to be a strong institutional bid around $30,000, as the crypto bounces just about every time this level is tapped.

As such, holding above $30,000 could provide Bitcoin with room for significantly further upside in the days and weeks ahead.

Featured image from Unsplash.
Charts from TradingView.

Top 5 cryptocurrencies to watch this week: BTC, ETH, UNI, ATOM, COMP

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‘When alt season?’ eToro may have some answers

What can I do to prevent this in the future?

If you are on a personal connection, like at home, you can run an anti-virus scan on your device to make sure it is not infected with malware.

If you are at an office or shared network, you can ask the network administrator to run a scan across the network looking for misconfigured or infected devices.

Goldman and Interactive Brokers Execs Claim Wallstreetbets Trend Could ‘Take Down the System’

Goldman and Interactive Brokers Execs Claim Wallstreetbets Trend Could ‘Take Down the System’

The heavy hitters in traditional finance have been concerned about the recent stock market action fueled by Redditors and a colossal number of retail investors. This week a Goldman Sachs executive warned that if these short squeezes continue it could “snowball through the market.” Moreover, Interactive Brokers founder Thomas Peterffy made similar comments this week saying these types of systemic risk can “take down the entire system, theoretically.”

Wallstreetbets Trend Could ‘Snowball Through the Market’

2021 has been an interesting year so far and this week a Reddit forum called r/wallstreetbets sparked a whole new hot topic. Four days ago, news.Bitcoin.com reported on the stock market fiasco that started with short squeezing Gamestop (GME) shares. But GME shares were not the only stocks that felt the push as the wallstreetbets (WSB) trend started leaking into a number of other types of shares.

The stock market story and Wallstreetbets (WSB) trend has shaken financial markets this week and has been one of the hottest topics in the United States. If you missed out on the WSB story this week, make sure you read news.Bitcoin.com’s report on the subject here.

For instance, stocks from the Russell 3000 Index (RUA) were targeted including tickers like NOK, GOGO, AMCX, and FIZZ. The social media craze even leaked into the cryptocurrency world pushing up coins like dogecoin and XRP as well. Estimates assume that short-sellers have lost “$70.87 billion from their short positions,” according to statistics from the financial data analytics firm Ortex.

An analysis from Zerohedge discloses that Melvin Capital lost a whopping $7 billion during the month of 2021. “Melvin Capital lost 53% in January, as Gabe Plotkin (a former SAC Portfolio Manager), lost over $5.3 billion in one month,” the report noted.

The financial newsdesk has also been reporting on another WSB trend taking place during the last week as short squeezers want to squeeze the silver market. One thread on r/wallstreetbets suggested that the power of the masses could squeeze the price of silver from $25 to $1,000. Zerohedge has been reporting on trends that show Redditors and social media users have managed to invoke demand for silver.

“In the 24 hours proceeding Friday market close, SD Bullion sold nearly 10x the number of silver ounces that we normally would sell in an entire weekend leading to Sunday market open,” the finance reporter disclosed. “In a normal market, we normally can find at least one supplier/source willing to sell some ounces over the weekend if we exceed our long position (the number of ounces we predict we will sell over the weekend).”

Additionally, polygon.com contributor Owen S. Good reported this week on how the meme-driven stock’ rally rescued AMC theaters from $600 million in debt. Meme lords and Redditors saved this business, not the U.S. federal government, not the bankers. Those groups were actively shorting AMC down the toilet. “Theater chain gets unexpected lifeline when private equity trades a corporate IOU for stock,” the author’s report explains.

Furthermore, the infamous Tyler Durden from Zerohedge wrote about an investors report published by Goldman Sachs executive David Kostin. Durden writes that the latest Goldman report warns “if the short squeeze continues, the entire market could crash.”

“The most heavily-shorted stocks have risen by 98% in the past three months, outstripping major short squeezes in 2000 and 2009,” Kostin’s study details. “This week demonstrated that unsustainable excess in one small part of the market has the potential to tip a row of dominoes and create broader turmoil,” the Goldman analyst added.

According to Durden from Zerohedge, Goldman’s Hedge Fund VIP list declined by 4% this week during the WSB fiasco. “In recent years elevated crowding, low turnover, and high concentration have been consistent patterns, boosting the risk that one fund’s unwind could snowball through the market,” Goldman’s David Kostin concluded. Durden interpreted Kostin’s final conclusion in a different way.

The author writes:

Translation: if WSB continues to push the most shorted stocks higher, the entire market could crash.

Interactive Brokers Chairman: ‘It Can Take Down the Entire System, Theoretically’

Goldman Sachs executives are not the only financial heavyweights weighing in on the stock market craziness and the possible aftermath. The founder and chairman of Interactive Brokers Group Inc., Thomas Peterffy, discussed his thoughts about the stock market madness in an interview with Marketwatch financial author Mark DeCambre.

Thomas Peterffy, founder and chairman of Interactive Brokers Group Inc.

On Thursday, DeCambre said that Peterffy explained that the short squeeze action could go on for a very long time unless it was stopped. DeCambre also wrote that Peterffy was worried about systemic risk and “the potential” for this trend “to ripple throughout the market.”

“It can take down the entire system, theoretically,” Peterffy stressed in his interview with DeCambre. “There is no reason why a short squeeze cannot go on indefinitely,” the Interactive Brokers founder detailed.

Meanwhile, a number of cryptocurrency enthusiasts have been cheering the WSB trend on as the virality of WSB vs Wall Street has encapsulated nearly all the social media conversations in the U.S. Meltem Demirors, the CSO of Coinshares, Europe’s largest digital asset manager with $3 billion in assets under management (AUM), gave her interpretation of the recent stock market events rattling the status quo.

“At its core, the events of this week are about free speech, censorship, and power. We are witnessing the fastest roll-up of power in human history,” Demirors said.

“As our lives become increasingly dependent on digital mediums,” Demirors continued. “So does the ability of powerful entities like governments and corporations to censor our right to free speech, our right to gather, our right to protest, and more. There is an unprecedented amount of power up for grabs, and what we see is a battle for control. It already played out on the political stage, and is now playing out in financial markets, financial media, Fintech platforms, and social media,” the Coinshares CSO added.

Furthermore, on January 29, the cryptocurrency trading platform Bittrex Global revealed that it was listing tokenized stocks for a number of the shares the WSB trend has been affecting. The exchange detailed that it made the decision because Bittrex wanted to “ensure retail investors have exposure to stocks they may wish to trade anytime during any day of the week.”

The crypto exchange also plans to list any other mainstream stocks that other finance trading platforms may censor in the future. The newly listed tokenized shares on Bittrex Global include Gamestop (GME), AMC Entertainment (AMC), Blackberry (BB), Nokia Corporation (NOK), and the Ishares Silver Trust (SLV). However, U.S. residents cannot participate, as Bittrex Global geo-blocks American citizens visiting the web portal.

“Bittrex is regulated in Lichtenstein and Bermuda and thus U.S. investors may be blocked from trading in these securities but other jurisdictions may be able to trade in these securities if they are interested,” the company details.

What do you think about the recent wallstreetbets (WSB) trend and Goldman and Interactive Brokers executives warning of systemic risk to the traditional finance system? Let us know what you think about this subject in the comments section below.

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Image Credits: Shutterstock, Pixabay, Wiki Commons, Tyler Durden Zerohedge, Goldman Sachs Global Investment Research, Twitter, r/wallstreetbets,

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.