Expert Reveals How ‘Fake Supply’ Is Killing Your Bitcoin Profits

Caitlin Long, founder and CEO of Custodia Bank, reveals that the BTC price should have hit somewhere close to six figures in the last cycle. In an interview with Robert Breedlove’s “What Is Money” podcast, Long reveals that “paper bitcoin” has created a fake supply of BTC.

21 million the trap

Bitcoin’s limited supply is one of its most bullish features. Its scarcity makes BTC more valuable than gold and other traditional stocks. In an interview with CNBC, Thomas Farley, the former president of the New York Stock Exchange, pointed to Bitcoin’s limited supply as an important feature. He believes that this characteristic makes BTC a must-have in one’s portfolio.

It can only be 21 million Bitcoin.

But, as Long explains, the financialization of Bitcoin may render its limited supply irrelevant. According to her, paper Bitcoin or IOU meets real demand with fake offers. An IOU is a promissory note that acknowledges debt.

Long reveals that if all IOUs are combined, the total amount of BTC promised to people is more than Bitcoin available today. More than 19.1 million Bitcoins have been mined as of now.

Long points out that the intermediaries and financialization of Bitcoin are a threat to the price of BTC.

Not your keys, not your Bitcoin

Caitlin Long questions the intent and role of intermediaries in the BTC trading market. She reveals that she was also once a user of crypto exchanges. Lenge learned his lesson after the Mount Gox hack that central intermediaries are not to be trusted. She believes self-care is the way to go.

Long believes that there is a lot of leverage in the market. While the March 2020 market crash due to the pandemic washed out much of the leverage, it built back up. According to her, the ongoing deleveraging that is forcing many major crypto exchanges to go bankrupt is driving the latest iteration of panic.

Nidhish is a technology enthusiast, who aims to find elegant technical solutions to solve some of society’s biggest problems. He is a firm believer in decentralization and wants to work on the mainstream adoption of Blockchain. He is also big on almost every popular sport and loves to talk about a wide range of topics.

The content presented may include the author’s personal opinion and is subject to market conditions. Do market research before investing in cryptocurrencies. The author or publication has no responsibility for your personal financial loss.