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Faizel Patel – 21/05/2021

(Twitter: @FaizelPatel143)

Block chain expert  Lorien Gamaroff says the crypto currency market is thinly traded and based entirely on speculation and that influential people like South African born and owner of Tesla and Space X can affect the perception of the commodity.

Gamaroff was speaking to Radio Islam on Thursday about the current market crash in crypto, where it is headed and what to do about it.

Bitcoin fells 26% this week after Musk went to war with the bitcoin crowd over his disapproval of the cryptocurrency’s energy consumption, and decided to reverse his earlier decision to allow purchases of Tesla cars in bitcoin.

The currency recovered somewhat following tweets from Musk that featured a diamond and hands emoji, taken as a signal the company had not sold off its huge bitcoin holdings as the CEO appeared to suggest recently.

Gamaroff says a single word tweet from influential people like Musk can have a huge impact on the Crypto currency market.

“There was a tweet saying if he keeps on getting bashed by the crypto community, he’s probably going to sell his stake and he replied ‘indeed.’ Of course that rippled through the crypto market and I don’t think it was the reason why we are going through a crash right now, but certainly just shows you how if the market depends on a single persons tweets, is that a sort of market that you want to be involved in?”

Gamaroff says the BTC verison of Bitcoin has the highest value.

“People think that they’ll get richer quicker on that crypto. But we’ve been seeing over the last while especially as fees are going higher other crypto currencies are becoming more prominent.  I would say that if people are still thinking  about investing in these things, than BTC might have a little bit of a headwind in terms of adoption, simply just because its impractical to use and there are so many alternatives.”

Gamaroff says BTC has always been about scarcity and in the context of global inflation that it could be a possibly a new form of digital gold is a pipedream, adding that a commodity can only be valuable if it is useful to people.

Listen to the interview with Lorien Gamaroff