Hacking or manipulation? | Don't make impulsive decisions
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Yesterday, in the controversial world of cryptocurrencies we lived an episode that highlights the volatility and risks that haunt this financial universe. A post from the X account of the SEC (Securities and Exchange Commission of the United States) announced the supposed and expected approval of the bitcoin ETF, making the price of the cryptocurrency go from $44K to $48K in minutes. However, the euphoria was short-lived, as it was later revealed from the account of the aforementioned institution's president, Mr. Gary Gensler, that the account had been "compromised" (hacked) and the news was fake. The result: a rapid free-fall to $44K. Pump & Dump? This incident once again puts the reality of manipulation in the crypto industry on the table, without us having to demonize it; however, it does raise valid questions about trust and market integrity.
Let's run the movie... investors celebrating the apparent approval, drawing up plans and strategies in seconds. It was time to buy and take profits. Then, the slap in the face. The fake news. Euphoria turns to bewilderment and the value of bitcoin drops without a parachute. Some made money in minutes; others, inevitably, saw their gains vanish. Minutes were enough to show the fragility of a market susceptible to the slightest comment and where Fake News plays with emotions, fading trust as fast as it is built.
This post was not a mistake, it was an act of blatant manipulation. Whoever compromised the SEC account played with the emotions and money of thousands of investors, showing how vulnerable the crypto market is to malicious acts. The question would be: how not to believe if the news was supposed to come from a reliable source? A few weeks ago something similar happened with a piece of news from the Cointelegraph account, the most important crypto newspaper. How not to believe it? Who to believe? Could the SEC be accused of indirect market manipulation? Who regulates the regulator? Would what happened to justify regulations in the industry?
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What happened yesterday is just an example of what can happen: the voracity of the market, the hidden intentions of malicious actors, the fragility of systems, and the susceptibility of the crypto industry. In this context, it is crucial to consider some general recommendations:
- before getting carried away by the excitement of a news item, verify its authenticity. I know that in this case, this would be in question, but valid to stress it for other scenarios. Thoroughness in verification is key in an environment where information can change in an instant.
- Control of emotions and caution with FOMO. The emotion of fear of missing out (FOMO) can be ruthless, avoid impulsive decisions just because you don't want to miss the party.
- In a market where manipulation is questionable, diversifying your portfolio is like building a storm-resistant boat. Don't put all your eggs (assets) in one basket (cryptocurrency).
Yesterday, teaches us that while gains can be attractive, caution is your best ally, particularly in this complex and volatile industry. Manipulation, even if we want to deny it, is present; in fact, recognizing it will help us to be prepared to face its challenges.
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First and Second Post on X about the subject.
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Images generated by the Dall-E 3 AI integrated on Bing, and here.
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Posted Using InLeo Alpha
Posted Using InLeo Alpha
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