The well-known author of “Black Swan,” Nassim Nicholas Taleb, expressed his opinions about Bitcoin’s recent drop on Twitter. He drew attention to the fact that BTC volume has fallen significantly—over 85% from its peak—and made the argument that as volume declines, market manipulation may grow.
Taleb said, “As volume drops, manipulations become easier but, at some point, manipulators will need to exit. This is how Open Ponzis implode.” he concluded.
His findings are consistent with the most current information provided by Coinbase, one of the top bitcoin exchanges. According to the platform’s Q2 financial report for 2023, both retail and institutional trading volumes have sharply dropped, falling by 70% from the previous year.
A persistent “crypto winter” and a flood of litigation brought by the Securities and Exchange Commission (SEC) might also pose additional problems for the sector.
The current stability, or rather lack of volatility, in the price of Bitcoin only serves to increase the anxiety. The continuous “extreme volatility compression” in the market was noted by Glassnode, a company that does on-chain market analysis.
Additionally, as of August 11, Bitcoin’s price is still below the critical $30,000 level, which has long been a support barrier.
Blackfridge CEO Mike Crosbie observed that Bitcoin was hovering dangerously just below the important $30,000 threshold. He told Barron’s that although there is still a potential that Bitcoin would try to break over this level higher, that likelihood is dwindling.
Noting that Taleb has a history of scepticism, it is important to note that his scepticism regarding cryptocurrencies is not unexpected. He drew a playful comparison to the mafia back in June when he said, “The main difference between Bitcoin and the mafia is that the mafia tended to deliver on its promise to offer protection.”
