Crypto Community Accountability For Rekt’d Bitcoin Price Predictions from “Experts”: Where’s the Line?
“Your money is safe in Bear Stearns,” Jim Cramer said just six days before the global investment bank went under. This was one of the many bad advice that misguided people before in 2008.
Past Daily Show host Jon Stewart famously faced CNBC Mad Money’s Jim Cramer for his coverage of the 2008 financial crisis, in what turned out to be one of the loftier financial media events of the decade. After calling Cramer out in an 8-minute Daily Show segment for being too slanted in approval of the companies in question during the onset of the crisis, Stewart and Cramer went back and forth alternating blows until both agreed to have Cramer on the Daily Show for an interview.
By the end of the interview, Cramer acknowledged that he could have done a better job anticipating and covering the economic collapse. Many considered at the time that financial media would take this event as a driver for change. Though, much like the activity on Wall Street that caused the crisis in the first place, we’re exactly where we were 10 years earlier.
Now the similar story is being repeated for crypto markets. Crypto brings all the meditation and risk-taking found in conventional capital markets and turns up the intensity by having 24/7 markets, retail-driven trading and no statutes. This has generated a breeding ground for supposed experts, including fund managers and analysts, to make names for themselves with lofty predictions that feed into the confirmation bias commonly found among investors.
Just last month BitcoinExchangeGuide had reported that when we look at the case of Bitcoin the predictions that have been made by CNBC have actually turned out to be 95% accurate, this is all according to the Trading view post that was made by Jacob Canfield. What this means is, 95% of the time that CNBC goes ahead to make a call and you take the different trade it will give you as an investor positive returns.
While this countertrade phenomenon has turned into a meme, which CNBC strangely jokes about on Twitter, it underpins the destructive nature of predictions in a market based so little on technicals. Bloomberg’s Joe Weisenthal recently said it best, “One reason to think that we haven’t hit the crypto bottom yet is that there are still tons of people out there whose reputations deserve to be much more tarnished than they have been so far.”
At the end of the day, the most impacted losers from this type of behavior are the retail investors who aren’t able to hedge their bets with options. This conclusively works against mass adoption, as new investors get the perception that cryptocurrency resembles gambling than anything else.