A Different Kind of Double Bottom

November 7, 2018 / by Bill Noble

Recently, The New York Times published a piece reporting that the Winkelvoss twins are suing Charlie Shrem, alleging fraud over 5,000 Bitcoin left me depressed and bewildered.

The New York Times piece used graphics and language to imply that the Winkelvoss twins were justified in their lawsuit based on the fact that Charlie had purchased an expensive home, a boat, and cars. Journalist Nathaniel Popper, who wrote the piece, called Charlie “Bitcoin’s first felon,” a label that reeks of guilty until proven innocent.

My first thought was this: Why would a major BTC holder like the Winkelvoss twins sue the face of BTC? I would think that people who invested in a fledgling, illiquid Bitcoin market from the start would have a broader vision. BTC is a currency that has the power to free men and women across the globe.

Job Creation

In my job interview for Crypto.IQ, Charlie Shrem didn’t say much. What he did say revealed the serious side to his personality.

He looked straight at me and said he takes hiring somebody very seriously. He views anyone who joins the firm as a member of his crypto family. Right then and there, I was more sold on Charlie than I had been before the interview.

Charlie’s words hearkened back to the original days of Wall Street when fierce loyalty to managers of tradings desks existed and even loyalties between firms and employees. I hadn’t seen or heard anybody talk like that since 1991.

When Charlie’s group offered me a job, my career was in need of a boost. I struggled to return to my passion of analyzing markets. Charlie gave me a shot to be an analyst in arguably the most volatile, controversial market of all time.

This article was written on November 6, 2018, the day of the U.S. midterm election. As a matter of fact, politicians do not create jobs. Corporations themselves do not create jobs. Entrepreneurs and managers create jobs. They decide to hire and allocate resources.

You can say what you want about Charlie Shrem. The fact is he created my job. My second chance. My shot at the American dream.

A Double Bottom

From a technical analysis standpoint, Charlie’s reputation may be about to make an intense double bottom. In many ways, this reminds me of the 1987 crash. There was the initial dramatic down move in October of 1987. That’s what most people remember. However, the true brutality of the crash came in early December when the October crash low was retested.

I was home in college at the time, and that low felt like the apocalypse. Naturally, that double bottom was a long-term bottom, igniting a 20-year rally in stocks. The economics and interest rate outlook was positive. The bottom was created by revulsion, by price action that made you sick to your stomach.

In Charlie’s case, he’s living December 1987. The events shown in “Banking on Bitcoin” on Netflix created Charlie’s own personal “October 1987.”

I have seen the arguments Charlie’s lawyers are using to defend him. As with stocks in December 1987, the “fundamentals” are with him even though sentiment is against him — and likely against crypto itself. It also seems possible that the NYT headline created such bad sentiment against Charlie, that it resulted in a “reputational double bottom.”
Bottom Line: Charlie helped start an organized mechanism for buying crypto. He helped create a BTC trading market when there wasn’t one. Then, as former colleague of mine put it, “(Charlie) did time for the cause.” The “cause” is crypto and its role in bringing true economic freedom to people everywhere.

Hurting Charlie hurts crypto. If you hurt the spokesperson, you hurt the product. When insidious FUD like this lawsuit comes from inside the crypto community itself, it may be a sign that things have gotten SO bad, that a golden BTC buying opportunity may appear in the next 30 days.

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