The rules have changed. Newly elected President Trump launches a coin the day before his inauguration. It sends a new message that reduced bureaucracy means coming unchecked profits and reduced consumer safeguards are coming.
This ultimately invites a lot of risk to crypto and markets.
Strong markets are built on confidence. This move is an early step to chip away at investor confidence.
The doors are now open for any group to launch a coin. If the president can, so can you. SEC filings, standards, and consumer protections are now officially out the window.
It invites many innocent, less-financially savvy consumers to believe that it's a good thing to invest in coins if the president apparently approves them.
This is the start of Crypto Tulip mania.
It also means there will be an influx of new coins ultimately taking demand away from Bitcoin.
New launches that get a pop may initially help Bitcoin’s price but money will likely flow from Bitcoin to lower quality coins. Those lower quality coins will most likely ultimately crash (to near-zero) at some point which will cause most people to lose money. Maybe they get initial pops but it sucks a lot of money into them. So the end-game is that consumers and investors likely lose their money.
That can and likely will reduce confidence in the system which can crash Bitcoin and the market as a whole ultimately.
What is going on is not a long term good thing for crypto or stock market confidence. It's a move that turns a secure confidence-based system into the wild west.
The .com boom and bust was because there were no profits.
A crypto boom bust based on anything goes is likely coming. We better see amazing action on Bitcoin otherwise there's risk sooner.
But the current situation, removing the SEC and doing what you want, invites a ton or risk ultimately for markets.
The SEC and consumer safe-guards are here for a reason, to protect consumers from scams and ultimately to protect stability.
Based on this, I would expect a lot of non-savvy money to get sucked into the system only to crash later on very much affecting the economy when that happens. Not imminent but at some point, so keep it in mind.
Timing everything will take some watching and finesse. We'll be following it of course.
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