Kill the Noise: Mainstream Media's Rush to Sensationalism
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Kill the Noise: Mainstream Media's Rush to Sensationalism
This week's spotlight: Fortune
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EOW closing Bitcoin price: $26,539
Date range: September 11 - September 17, 2023
Bitcoin Perception Index (BPI): 38/100 - trending towards fear
4 Main Topics: Bitcoin's Price Movement and Market Analysis; Regulatory and Legal Developments; Institutional Involvement and ETFs; Technological Advancements and Integrations.
This week's spotlight: Fortune
Weekly Snapshot
Main Topics Of The Week
Bitcoin's Price Movement
Analysts are questioning the longevity of Bitcoin's rally. Technical indicators like the "death cross" have historically indicated bearish trends, which might be a concern for investors. This sentiment is covered in this week’s spotlight further down in this report. Reference
Spoiler alert: It’s completely unfounded.
Regulatory and Legal Developments
The crypto industry is closely watching the trial of FTX founder Sam Bankman-Fried. Legal battles involving Bitcoin miners indicate the growing pains of the industry as it matures and faces challenges. Reference
Institutional Involvement
The push for a Bitcoin ETF in the US has seen significant developments, with Grayscale's victory marking a pivotal moment. Wall Street's involvement and the potential benefits for funds like those managed by Cathie Wood and Boaz Weinstein indicate growing institutional interest. Reference
Technological Advancements
Coinbase's move to integrate the Lightning Network underscores the industry's push for faster and more efficient transaction methods. The intersection of AI and blockchain suggests a future where trading strategies might be dominated by machine learning algorithms. Reference
Spotlight on Fortune
The media's penchant for dramatic narratives often overshadows the nuanced details that truly matter. The recent coverage surrounding FTX's potential liquidation of their token holdings is a prime example, where the Fortune piece by Marco Quiroz-Gutierrez was the first one to “ring” the proverbial alarm.
Major outlets took the story and ran with it, like Forbes, Bloomberg, Reuters, and CNBC - all quick to predict a significant price drop for Bitcoin based on this development.
But if you take a closer look, the facts paints a different picture.
While the headlines screamed impending doom, they conveniently omitted a crucial detail: FTX is limited to selling up to $100 million in tokens per week.
To put this in perspective, FTX's entire Bitcoin holdings were estimated at $268 million as of January. Now, take a second to think about Bitcoin's liquidity, FTX’ Bitcoin holdings and the weekly sell-off cap… such a sale would barely cause a ripple in its price movement!
This oversight underscores a broader issue in media reporting.
Instead of delving into the intricate market dynamics that genuinely influence Bitcoin's price, many outlets opt for the low-hanging fruit of dramatic narratives. Such narratives, while attention-grabbing, can mislead readers and create unwarranted panic.
In an age where separating signal from noise is important (the reason why Bitcoin Perception exists, to be honest), it's essential to look beyond the headlines and understand the underlying factors at play.
In the case of Bitcoin and FTX, the reality is far less dramatic than the media would have one believe. Just take a look at what happened with the price during the working week - price went up while media coverage went down.
