Does the Price of Bitcoin Really Depend on the Opinion of Elon Musk? An Interview With Norbert Goffa, the Co-Founder of ILCOIN Blockchain Project
Q: What is your opinion about the post of Elon Musk, where Tesla dissociated itself from Bitcoin, regarding the environmentally damaging effect of its mining?
A: Honestly, I find it very amusing! Naturally, Elon Musk just happened to realize that the mining of Bitcoin has an environmentally damaging effect. I guess someone at Tesla just told him that we do not like Bitcoin anymore, since it is harming nature… In one word, I think this whole thing is a joke. Of course, I do not feel like laughing about its effect, since we saw what happened. However, I greatly doubt that the crashing of the price was solely caused by one tweet from Elon Musk. If it is true, then this market is standing on much weaker foundations than I had thought.
Q: If it was not caused by the opinion of Elon Musk, then what was the real reason for the 30-40% fall of Bitcoin and Ethereum over only a few days?
A: I do not want to breed conspiracy theories, but the statement of Elon Musk just came handy to certain groups who wanted to short. Let us just ask the right question! Who profits the most when the price crashes? The answer is really simple – the exchanges. I do not want to accuse anyone, but the activities of certain exchanges would be severely punished on a regulated market.
Q: What is the problem with the exchanges? Why do you think that the exchanges are responsible for the overnight collapse of the market?
A: I am not stating that the only catalyst of the events are the exchanges, I only wish to say that a situation where the TOP cryptocurrencies are moving 30-40% is good for them. Let us for one moment imagine that Elon Musk tweets something and his ideas generate a hundred billion in sales. I do not want to over or underestimate Elon Musk, but I think that he alone is just not enough to make anything happen. A market is necessary for things to start moving, a market where there is a huge gap between reported and real trade. The volumes we see are far from reality. Every exchange uses market makers. There are several companies that provide MM services. Besides this, projects use their own free accounts. So let us not be naïve. A lot fewer people sell because of an Elon Musk tweet, than what is shown in the data of the listing sites. In essence, the market falls because of false volumes.
Q: So you just don’t like the exchanges. What kind of solution do you see for the mentioned problem?
A: It is not true that I do not like exchanges. There is no problem with the exchanges, but rather with the speculative nature of the market that has arisen from their unregulated operations. It’s just like the Wild West! Let us just think – Bitcoin falls by more than 30% over a few days. Of course, there are a whole lot of people with open purchase positions at low prices, which just drags the price down. Make no mistake, the exchanges are not the only ones responsible for this. The exchanges are providing opportunities and it is also in their interest to create a situation where Ethereum falls to 2,000 USD from 4,000 USD. This is tough, very tough. I am not even mentioning Bitcoin, which experienced a much more significant drop. It just hurts the eye when you see the Binance coin going under 300 USD. The coin of the exchange that everybody knows is the biggest participant of the cryptocurrency market. Do not tell me that it is because of Elon Musk!
Q: It seems from the above mentioned, that you are more the pessimist with the market than the optimist. What future do you see for cryptocurrencies? What kind of price do you think Bitcoin will reach by the end of 2021?
A: I do not think I can be called a pessimist, because I do not let myself be manipulated. I just simply do not think that a tweet could result in a fall of 30-40%. That is my opinion. This is why I explained the reasons that could be standing behind the price fall. This is not a pessimistic or an optimistic point of view. It is only an opinion, which is good for giving a different angle at the events of the market. Yes, I am a critic of exchanges. It mostly comes from experience. We have so much bad experience with exchanges, but when asked whether I have a good or bad experience with exchanges, sadly I have to say that it is more bad than good.
As for the future, I think that Bitcoin will be one of the best investments of all time. Regardless of its current short-term discretion. Of course, Bitcoin is not perfect, but its basic concept predestines it for success. I do not like to predict, there are more than enough “experts” for that, who wish to gain popularity with a few hundred thousand dollar short term tips. I think that these are hollow statements. Nevertheless, I am certain that in the long run, the price of Bitcoin will be much higher than it is today. It needs time. Not even mentioning the short and long-term effects of the occasional regulations.
The cryptocurrency market should go up to the task. This “Wild West” like state should be eliminated with time, and a clear, stable and transparent market is necessary in order to reach success. Bitcoin will fulfill its mission and shall fill the role for which it was destined. It will have a serious role in economic life as the digital gold. It will have the same role as gold, but only with different foundations, since the technological revolution is changing everything. I hope you now see that I am more of an optimist, but I wish to stand with both feet on the ground.
Q: If we were speaking about Bitcoin, let us speak about Ethereum. What do you think about the future of Ethereum and the altcoins?
A: I don’t really like the term “altcoin”, because while it bears meaning, it is still a bit unclear. Bitcoin does not need alternatives. However, I do not want to get into this, since it would be a different conversation.
Ethereum is getting stronger. DeFi and NFT projects elevated Ethereum to a new level. Two years ago, I thought that Ethereum would be dismissed, but today, I see it in a totally different light. The network has to grow strong enough to handle the innumerable projects. It is clear that the price of the Ether also depends on Bitcoin, just like any other project on the market. So, any talk about the future of Ethereum can only be made from the shadows of Bitcoin. If Bitcoin will be stronger, then Ethereum will also be stronger. I cannot contribute more to this question. Clearly, many more challenges lie ahead for Ethereum if it wants to stay in the role of a market leader in the long run for the DeFi and NFT markets. We will see how the future plays out. It is really hard to comment on this.
Q: If we were talking so much about the market, could you say a few words about ILCOIN? What kind of future is waiting for you?
A: ILCOIN is undergoing huge changes. Sadly, the values we were building on during 2018-19, are no longer in effect on the market. Nobody wants large block sizes, nobody wants to store data on-chain and questions about security become secondary. Now, DeFi and NFT are the top hits. Nothing is really important anymore. There may be an exaggeration to this, but if we take a good look at it, there is truth in my statement. We have developed and are still developing games, they do bear value, but today, the emphasis is not on such developments. Therefore, we do have to alter the project in such a way where we keep the valuable things, and a renewed project should be able to reach new users. Our present community has a huge role in this, in making us known among a broader audience of users.
In one word, there are new plans in focus, where we will try to validate the strength of ILCOIN, but we need time. The changes will not happen overnight. The market is changing fast. What we think to be a trend this year might not be so next year. Therefore, you cannot bet everything on one card. With more than 5 years of experience, we saw quite a few things. And that combined experience helps us a lot in building our future. ILCOIN wields the most advanced technology among the SHA-256 PoW coins. This is very good, but when we are speaking about altcoins, there is greater need for Ethereum-based solutions than Bitcoin-based approaches. But, this can be changed. This is the most exciting thing about the crypto market. It is dynamic, unpredictable and you can win big or lose big. If one cannot handle it, then go and buy Swiss or Norwegian state bonds.
About Alyona Karpinskaya: Founder of the PR-Blockchain agency, technical writer, journalist and publicist