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The FTX fiasco took bitcoin a big chunk of the way towards my target of $13,000. So was that the bottom or is there more to come? More to come.

Remember my red flags:

  1. Billionaires from nowhere.
  2. Heavy PR of the “messiah type.”
  3. Deals that look like cash grabs.
  4. Flashy behavior in general.
  5. Asshat behavior in particular.
  6. Opaque capital generation.
  7. No good reason for success or its scale.
  8. Wash trading, market manipulation circumstantial evidence.
  9. Centralization.
  10. Philanthropy (sorry to say it but it’s often the hallmark of fraudsters trying to buy legitimacy).

Does that sound like anyone in the market right now? Someone that hasn’t gone bust yet?

Timing is of course everything in a bubble bust. It can be a matter of hours between going bust and living to become tomorrow’s giant company. Back in the day it was said Fox only survived because of the arrival of the check for the hit movie Home Alone and if it hadn’t shown up on that day it was curtains for Murdoch’s whole outfit.

Murdoch’s old rival, meanwhile, met his end in the ocean having come adrift from the back of his yacht. So FTX could be the end of this crash but from reports all the big centralized players are joined at the hip in a web of interconnected businesses. None of this is anything but shady and caused by the fact that the high profile outfits took ridiculously huge risks from the start to get where they are.

They are not the sort of people to get out before a bubble turns into the bust, they’ve hung tough before and it paid big. It is Digital Currency Group that is the biggest cloud on the horizon, but the next domino could be any one of a couple of dozen companies. DCG owns Genesis, which is basically toast. DCG owes Genesis a huge pile of cash. DCG owns Greyscale, which probably owns 600,000 bitcoin BTC -2.6%.

If that intermeshed pile of assets and liabilities comes unglued it would seem likely that a mountain of bitcoin could get dumped into the market. This is my “most troublesome” meltdown scenario… it’s not fate, but it is possible. Without that there is enough to take bitcoin to $10,000 anyway.

The thing to recall is the whole point of crypto is decentralization but the robbers can’t conquer the market for themselves without centralizing it, so the human crab sidles about centralizing crypto in an attempt to steal big lumps for itself to scuttle off with.

Centralization is what humans do and when you think progress is mainly getting humans out of the productive process, where they are either too costly, too slow, too stupid or too awkward, you can see the overwhelming tension between general progress and groups grabbing resources for themselves and their kin, by getting between progress and the rest of us.

However, the process of centralization is implosive, because the centralizers wreck the very thing they want to purloin. Haters gonna hate, predators gonna predate. This is why CeFi is imploding, because greedy sociopathic predators have no limit and end up killing the golden goose. These bubble market heroes aren’t smart, they are just unbounded, so they are genius on the way up but idiots on the way down. And here we are—but we ain’t there yet. But we will be—and then it will be time to buy.