Crypto Analyst Warns That Bitcoin is Under Attack by Vampires
The cryptocurrency market has been exhibiting a mixed momentum in recent trading, but the prevailing feeling during this ‘Uptober’ – a popular nickname for October – remains optimistic.
Following several months of slightly downward trading, Bitcoin (BTC) broke away from the trend and began surging, finding stability near $68,000. This surge led many traders, experts, and observers to speculate how high BTC could go during the rally, with some predicting a rise to $86,000 by Halloween and $100,000 soon after.
Amidst the optimism, well-known cryptocurrency analyst Duo Nine issued a warning on X that ‘Bitcoin is in danger,’ with long-term risks being similar to the current short-term benefits.
According to the expert, the increased rate of BTC adoption is, in some ways, a double-edged sword, considering how much Bitcoin activity is done through third parties and off the main chain. Duo Nine singled out actors such as Coinbase (NASDAQ: COIN), BlackRock (NYSE: BLK), and the many BTC exchange-traded fund (ETF) issuers and practices such as wrapping – the conversion of the cryptocurrency for use in the Ethereum (ETH) ecosystem – as the main culprits.
The analyst likened the phenomenon to ‘vampire attacks,’ as main-chain Bitcoin remains dormant while its value is exported and abstracted elsewhere. This, in turn, starves the primary network of fees, thus lowering the funds available for maintenance and security.
Duo Nine also pointed toward the danger arising from the use of third parties in general as they could, at any time, ‘break their promise,’ leaving investors who do not hold Bitcoin directly but only derived representations of it exposed.
According to the analyst, Satoshi Nakamoto also warned against this danger when he wrote that the main benefits of BTC are lost as soon as intermediaries are involved. Duo Nine recommended self-custody and engaging with the main network through developments such as Ordinals as the best way to remedy this likely long-term ailment.
Despite the long-term risks, Bitcoin remains remarkably strong. The issues stemming from the ‘vampire attack’ on Bitcoin are unlikely to play a major role for some time, at least for another decade, according to the analyst. This means the damage they might be doing will not be evident in the foreseeable future.
In the last 30 days, Bitcoin rallied 4.73% with the most notable segment within the time frame being the 16% surge from October 10 lows at about $59,000 to BTC press time price of $68,810. Additionally, the 1.78% rise in the last 24 hours marks another shift to the upside from a period of relative stagnation that started on October 21.
In total, Bitcoin is 60.93% above the price it started the year at, and 96.57% above its value exactly one year ago.