No, Bitcoin Price Hasn’t Moved Since Debates, Trump ‘Crypto Burgers’ Or Anything But Trickery – Attack of the 50 Foot Blockchain

Bitcoin has slipped out of the public consciousness to such an extent that even the press has forgotten that the price of BTC rises and falls like a yoyo for any or no reason. So I’m getting questions I’ve answered previously, which means it’s time to turn them into a post. (Newsweek; Newsweek)

Donald Trump is very late talking about bitcoin and crypto. You’d almost think he didn’t have any money ready. Zeke Faux and Muyao Shen have a great article on Chase Herro (aka Chase Hero), the guy who actually runs Trump’s crypto company, World Liberty Financial. Herro has declined in the world since selling colon cleansing. (Bloomberg, archive)

And yesterday, Trump bought “crypto burgers” for supporters at a bitcoin-themed bar in New York — apparently paying in bitcoins, though someone else had to make the transaction for him. (USA Today)

So that’s the reason has the number increased?

Not. You don’t need to invoke a Trump speech at Bitcoin 2024, debate performance or buy hamburgers as explanations. Rising or falling by $5,000 in a day is par for the course in bitcoin.

Cryptocurrency markets simply do not react to what would normally be considered a market signal in the same way as well-regulated high-volume stock or commodity markets.

These are small, thinly traded and unregulated commodity markets. This means that the internal manipulations absolutely drown out the larger macro signals.

Here’s a nice study from the New York Federal Reserve. “The key finding is that, unlike other US asset classes, Bitcoin is orthogonal to monetary and macroeconomic news.” (New York FedPDF)

Binance is where the price of bitcoin is set

The price of bitcoin is determined by trading, and it is mostly traded against the unregulated Tether and FDUSD stablecoins on Binance.

The volumes of just the BTC/USDT and BTC/FDUSD trading pairs on that single exchange swamp all other bitcoin trades. Coinbase or regulated ETFs aren’t even in the works.

Binance is under heavy US compliance monitoring for money laundering compliance and keeping US entities off the exchange – but the trading platform remains completely unregulated.

Every market abuse you can think of — washed trading, manipulation, stock trading against one’s own clients — is standard. And probably not even illegal!

Support for Tether and FDUSD stablecoins is also extremely dubious. Tether admits that a large part of their backing is USDT loans, where they create USDT out of thin air, then claim that the loan itself is the backup asset backing these USDTs. And I don’t think FDUSD is significantly backed by real dollars.

Amy Castor and I wrote about all of this earlier this year here and here. Nothing has changed until 2024.

Bitcoin does not react to macro signals, only domestic market mess.

Could there be an outside signal affecting bitcoin price?

Sure. Some drastic regulatory or criminal actions that change the shape of the market – for example, the destruction of Tether or Justin Sun. That would probably do things.

In short, I expect the current nonsense to continue — the public won’t care, the number will rise and fall, and journalists will occasionally notice the number and wonder if there’s a story there. But there isn’t, really.