Bitcoin is going through another hard time now that China has fully banned it. It’s not like bitcoin has been faced with harsh conditions in the past, but the one thing we can all agree to is that BTC tends to recover every time it deals with opposition. This has been noticed by analysts such as Dennis Lynch of Morgan Stanley, who recently likened BTC to the character of Kenny on “South Park.”
Dennis Lynch Likens BTC to Kenny of “South Park”
For those of us who have seen the show before, each episode – or nearly each episode – features the character of Kenny experiencing some majorly gruesome death. It’s become a running joke amongst the show’s creators, and for some odd reason, despite dying in many previous episodes, Kenny always seems to come back unharmed later down the line.
Lynch says that bitcoin has taken on a similar form. He recently commented at a conference:
I like to say that bitcoin’s kind of like Kenny from ‘South Park.’ He dies every episode and is back again.
Bitcoin was dealt a rough blow a few days ago when the currency was fully outlawed in the country of China. No digital currency activity that doesn’t involve the digital yuan can take place within the nation’s borders. This includes transactions. The price of bitcoin ultimately fell from about $44,000 to roughly $42,000 within just a few hours, and some feel that the price could sink even lower in the coming days.
It’s not a good time for the world’s number one digital currency by market cap. Nobody can deny that. However, it’s hard to assume that bitcoin will be permanently affected by the move. After all, it’s not like this is the first step China has taken towards hurting the asset.
Not long ago, the country – through its desire to become more carbon neutral – announced that it would be purging itself of all crypto miners. The asset dropped into the low $30,000 range following this news, and even briefly fell below $30K for a short period. However, the asset has since jumped back into the $40,000 range, and the currency wasn’t down for long. Clearly, the asset has become more mature over the years, and has developed a “thicker skin” against all the opposition it seems to be facing.
Maybe The Price Hit Won’t Be So Bad
Perhaps this time will be no different. Lynch says:
I think (bitcoin) demonstrates some ‘anti-fragile’ qualities during this period, anti-fragile being something that gains from disorder. It kind of sits in the portfolio in a small manner. That it is something that can go right when the rest of our portfolios have something going wrong… I can envision (bitcoin) benefiting from different environments, whether people look at it as a digital gold, or people start to really question (the) fiat currency, given all the stimulus and the policy there (since) the Fed has had to be so accommodating.