On the afternoon of June 3rd, AICoin researchers conducted a live graphic and text sharing session titled "Ten-Year Opportunity for Old Leeks: ETF and Mt.Gox (with Membership)" in the AICoin PC-end - Group Chat - Live. Below is a summary of the live content.
I. Mt.Gox
1. From Card Exchange to Bitcoin Trading
MT.Gox (Magic: The Gathering Online Exchange) is one of the most symbolic and influential exchanges in Bitcoin history. Its rise and fall have had a profound impact on the entire cryptocurrency market.
MT.Gox was initially created by programmer Jed McCaleb as a trading platform for exchanging "Magic: The Gathering" game cards in an online marketplace. The "Gox" in the website name stands for "Gathering Online Exchange," an abbreviation for the card online exchange.
McCaleb recognized the potential of Bitcoin and decided to transform MT.Gox into a Bitcoin trading platform. MT.Gox officially started operating as a Bitcoin exchange in July 2010. By 2011, MT.Gox quickly became one of the world's largest Bitcoin exchanges, handling over 70% of global Bitcoin trading volume.
2. Lessons from the Collapse and Market Turbulence
In June 2011, MT.Gox experienced its first major hack, leading to a temporary suspension of operations. Hackers manipulated market prices by obtaining user account information, causing significant market fluctuations. In February 2014, MT.Gox announced the suspension of all Bitcoin withdrawals, citing "technical issues," which triggered market panic. On February 28, 2014, MT.Gox filed for bankruptcy protection in Japan, admitting to losing approximately 850,000 Bitcoins. The trajectory of MT.Gox, along with the rise, theft, and bankruptcy (compensation/runaway) of many other exchanges that followed, was almost identical.
When MT.Gox filed for bankruptcy protection in Tokyo, the documents mentioned the loss of 750,000 Bitcoins belonging to users and 100,000 Bitcoins belonging to the exchange. Later, 200,000 Bitcoins were found missing in the exchange's cold wallet, but the whereabouts of 650,000 Bitcoins remained unknown, making these 200,000 Bitcoins a "time bomb" for the industry.
Due to the relatively small scale of the industry's funds, each piece of news from MT.Gox would cause market panic, leading to price declines and market fluctuations.
3. Short-Term Impact of the MT.Gox Incident
① The collapse of market confidence, especially for old users who instinctively anticipate a decline with each MT.Gox news, presents a profit opportunity. Taking advantage of market panic to buy low. During the period of heightened market panic caused by the MT.Gox incident, use emotional indicators (such as the Crypto Fear & Greed Index) to identify extreme panic. Buy in batches when prices drop significantly, and sell when market sentiment stabilizes and prices rise to profit from the difference. Dollar-cost averaging (DCA) is very effective during the MT.Gox incident. During market panic, use the DCA strategy to average investment costs. The panic brought by the MT.Gox incident will not disappear in the short term.
② Although the MT.Gox incident had a significant negative impact on the market, it drove the development of market regulation and security strategies. The introduction of ETFs promoted the standardization and mainstreaming of the market, gradually shifting the cryptocurrency market from its early "wild west" era towards a more mature and stable direction.
II. The Rise of ETFs and Future Trends in the Cryptocurrency Market
The approval of ETFs presents a great opportunity. We should closely monitor announcements related to ETF applications and approvals, and engage in short-term trading based on market fluctuations caused by news. Enter the market when expectations are enhanced before the approval of ETFs, and sell for profit when prices rise after approval. Buying before ETF approval and selling after approval is a classic short-term operation. After the approval of ETFs, consider phased positions when prices drop by around 5%. The approval and launch of cryptocurrency ETFs are usually seen as a recognition of cryptocurrencies, which improves market sentiment. The introduction of ETFs allows more traditional and institutional investors to conveniently invest in cryptocurrencies, leading to new capital inflows.
ETFs bring in new capital, resulting in industry growth. In the future, it is difficult to imagine any other event besides the MT.Gox incident that could generate such significant attention and drastic market fluctuations within the industry. As more ETF varieties are approved, the industry will enter an era of large capital, and it will be difficult for the MT.Gox incident to cause major fluctuations. Pay attention to ETFs, buy in during declines similar to those caused by the MT.Gox incident, and build positions. ETFs bring long-term benefits to the industry. Learn more about DCA and use it more. Keep a close eye on announcements related to ETF applications and approvals, and engage in short-term trading based on market fluctuations caused by news. Enter the market when expectations are enhanced before the approval of ETFs, and sell for profit when prices rise after approval.
·DCA, Dollar-Cost Averaging, is an investment strategy that helps investors diversify market risks and reduce the impact of market fluctuations on overall investments. When using DCA, choose cryptocurrencies with large market capitalization, high liquidity, and proven long-term value, such as Bitcoin (BTC) and Ethereum (ETH). Avoid using DCA for cryptocurrencies with poor liquidity.
PRO members and signal alert members have access to high-quality tools tailored for lazy traders, and custom indicators can help any AICoin user plan their trades and trade their plans. For more custom indicator strategy displays and multiple alert reminders, feel free to experience the custom indicator membership for free for a limited time. Click the link below to start your experience: https://aicoin.com/en/vip/chartpro
Recommended Reading
- “Trump all in Bitcoin, should you follow?”
- “ETF, a new way for old leeks to profit in ten years”
- “How to choose coins in the massive unlocking phase?”
For more live content, please follow the AICoin "News/Information - Live Review" section, and feel free to download the AICoin PC-end.
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