Interview with Lado Okhotnikov: The Secrets of Stock Exchanges, Who Controls the Market, the Secrets of a Marketmaker. Part 2


Lado Okhotnikov - Who Controls the Market

From the first part of the interview with Lado we got to know how his journey began, where he earned his first bitcoins and how he got into the crypto sphere. Today we will continue our talk in order to understand whether moneymakers collude, who controls bitcoin and whether it will cost a million dollars.


Lado, is there anyone who manipulates bitcoin? Can we assume that there is someone who has a plan that bitcoin is worth $300,000 in 5 years or its ups and downs occur according to the situation?

Market behavior is not determined by the actions of miners or institutional players only. There are also retail traders, investors, bulls, and bears.

When miners had significant capitalization and market power, they could manipulate the price moving it in the direction they wanted. However, with the advent of larger funds (with a capitalization of more than a billion dollars) their influence has decreased.

As such, there is no plan; no one is shaking bitcoin on purpose. However, there is fear and greed in the market. They are the two main factors that drive the market. Creating a negative news background causes fear among traders and investors which leads to sales. Large institutional players or “whales” naturally use this situation to buy assets at a lower price.

Greed appears as a counterbalance to it. It makes the traders start buying assets expecting a price increase. In this case the “hamsters” are gaining positions in the hope of the further asset growth. This is where the manipulator comes into play.

Market manipulations exist. However, it is important to understand that the market moves under the influence of fundamental factors, news, technical analysis and reactions of various participants.

Is it true that the most part of bitcoins was once mined by some limited number of people? Can they be identified somehow?

Indeed, at one time a significant share of bitcoin was mined by a small group of people. However, over time these coins could have been redistributed among other market participants. It is impossible to say that only five people hold the bulk.

The blockchain has information about the assets movement and it is visible. I know people who have developed serious analytical platforms that help conduct deep analysis based on smart contract data. They see how many assets are moving, what part is “frozen” and can identify large holders. But still, the blockchain provides anonymity and security so it is not always possible to accurately identify the owners of certain wallets.

There is an assumption that of the total amount of bitcoin that is currently in circulation the third part is “dead”. But it is impossible to say for sure whether these coins are lost or are in “hibernation”. At any moment the holder will wake up and sell the coins, thereby “dropping” the market.

Lado, do you think CZ is a cryptocurrency adept?

My opinion is that he is an ordinary businessman. As soon as the crypto ceases to be profitable CZ will be reformatted and adapted to the changed circumstances. It is impossible to say that he is “with both hands” for decentralization. As you know Binance introduced user identification, thus having bent under the system

I can’t even name such people (among the influential ones) who would really advocate decentralization. Everyone talks about it but in reality the opposite happens. We see how exchanges are implementing KYC (know your customer policy). And you can’t say that someone is resisting it.

Is it the fear of being eaten? Yes! I believe Satoshi Nakamoto deliberately hid his true identity so as not to be pressured by others. He maintained contact with developers and the community during the first two years of the bitcoin existence and then disappeared from the public space in 2010.

Who creates pulse movements? Are they retail traders?

Retail traders, ordinary “hamsters” serve as fuel. Their elimination becomes the driving force. You can see that there is an assets accumulation before any significant dump or pump. At this time the assets are distributed: some traders get into long positions (expecting a price increase), others into short positions.

The task of the manipulator is to take as much liquidity as possible which is on both sides. This creates conditions for further movement along the desired trend. After reaching this goal the moneymaker will definitely start moving the price in order to attract new participants to the market.

Does technical analysis work in crypto?

Technical analysis works in the classical market with the right economy management and structure, and the right regulatory policy. But crypto is about decentralization and at any moment a player can come and sell a large amount of coins on the market. This will lead to a collapse but it will not be interesting for the player. His or her task is to find a buyer and the fact that others may suffer from it is not important to the player.

In the classical market one cannot simply take and sell a huge amount of currency at the market price, as this can provoke a resonance. You simply will not be allowed to do this, the order will be blocked. And in the cryptocurrencies no one controls you; no one can cancel the operation since this is a decentralized structure.

Is tomorrow with DeFi or is it a hype?

There is always someone who will control you. In the jungle where there are no rules a person inevitably becomes controlled. Instead of our usual laws and social norms the laws of nature dominate in this environment. In order to survive and thrive in this environment you need to adapt and use the rules to your advantage. Those who learn to adapt and understand faster than others will have a better chance of success.

Someone has invented DeFi with the purpose of moving from one form of governance to another but nothing more. I will refrain from assertion that soon everyone will be independent – someone should manage the society. No system can work uncontrollably. Otherwise, it is no longer a system but chaos.

Lado, last question: can bitcoin cost a million dollars?

Soon the bitcoin emission will end and then this asset will become scarce. How soon? You can’t say for sure but you can guess. Bitcoin halving occurs about once every 4 years. The specific time depends on the blocks mined in the network. Since the block generation time is about 10 minutes it will take about 4 years to mine 210,000 blocks.

How much growth will happen? It is impossible to say for sure since very large investors can enter at any time by buying this resource. It will be them who create even greater bitcoin shortage.