..."The truth is incontrovertible. Malice can attack it, ignorance can make fun of it, but in the end, the truth is there"... Winston Churchill
The manipulation of the market is a subject that generates debate among people, some think that manipulation exists, others think otherwise, however, does this possibility really exist? Can we say that there is such manipulation in the face of the recent price movements of Bitcoin and the market in general?, accompany me in this adventure in search of the truth.
In the field of cryptocurrencies, there are many who denounce this manipulation, outstanding analysts in the cryptographic world are part of this movement, however, we can find people who claim that this does not happen, and it is at this point where the debate opens . To achieve success in this journey, we must be clear what is the manipulation of the market? Some define it as "the attempt" to create notorious effects on the "free and fair" movement of a market for its own benefit, through qualified actions as fraudulent or deceptive, trying to generate a favorable opinion about an asset or financial product that does not really represent the expected value.
If we evaluate the market subject to this definition we can easily determine that there is manipulation, but outside these acts, we could go a little further, what happens when some actors in the market perform actions that are carried out daily, but given the size of their portfolios generate a "detrimental" movement in prices affecting the majority of investors ?, a big capital investor interested in acquiring bitcoins, how could all of them acquire them without moving the price against them ?, given that, placing an order of gigantic purchase in some exchange would elevate the price to new maximums thanks to the limited supply with respect to its capacity, this investor needs that there is a counterpart that wants to sell him and that supplies the required amount; on the other hand, it is important to bear in mind that the capitalization of the cryptographic market is tiny compared to the traditional market, this implies that there are few actors that have a high capacity to influence prices. Knowing all these conditions we can explain to some extent the reason for the sudden fall in prices.
Let's see the graph, see how the price falls, however, by exploring the wallets we can determine that there is no mass selling intention on the part of the public, that is, it is about someone or a few with the control of some powerful wallet influencing the market for that behaves in this way, but how is it possible to influence the market so that the price falls to these levels?
The graph we see on this occasion corresponds to sales in short, that is, someone sold a large number of units, possibly with intentions to buy at lower levels, while obtaining profits by lowering the price thanks to the short, simultaneously creating concussion in small investors who believe that it will continue to fall and rush to close their positions further raising the domino effect unleashed in the first instance by someone very skilled, unleashed the storm, the mastermind behind that large portfolio just have to look at how the price arrives at the levels that he wants to buy the remaining percentage he needs, obtaining a privileged position in the future when the time comes to consolidate the cryptographic mechanisms and mass adoption of them takes place.
Seen all this, is it possible to talk about manipulation when it becomes a necessity for some? If you had millions of dollars at your disposal, would you act in the same way? Would you resort to the OTC market? What, if the OTC market will not cover your demand and there is no other way but to resort to the broker to acquire your assets? Would you carry out all these actions knowing that you will cause losses to the great majority of small unsuspecting investors ?, It should be noted, also, that there are no laws or organisms that regulate this environment, basically those who enter this world should know that they are facing a world without law; he who has better preparation in all aspects of the market is much more likely to win.
No more to add, leave me your comments, what do you think about it ?.
I hope you have an excellent day, goodbye.