Social Mood Conference | Socionomics Foundation

Excerpted from the April 2013 Elliott Wave Financial Forecast

by Elliott Prechter (April 5, 2013)

There is one unmitigated mania remaining. It is in Bitcoin, the world’s first successful digital currency. EWI first wrote up Bitcoin during its humble beginnings. The September 2010 issue of The Elliott Wave Theorist covered the new currency when 1 BTC was worth 6.5 cents. It turned out to be a great time to discuss it because with Bitcoins now trading at $137 (, a $1,000 investment at that time would be worth over $1.6 million. Bitcoin’s upward spikes, however, have coincided closely with those of other “risk-on” assets. Thus, the timing of the recent exponential rise shown on the chart is not surprising, as it coincides with the final speculative fling in the S&P. The bullish psychology of Bitcoin investors is at least at equally manic levels. Many enthusiasts on are taking out loans and/or liquidating their IRAs to buy Bitcoins. recently reported that one person even sold a $395,000 house to invest in Bitcoin:

A 22-year-old currency trader is selling his grandparents’ house for as many Bitcoins as he can get his hands on. [He] put the listing up for the family home in Alberta, Canada, several days ago.

Meanwhile, Bitcoin pundits are claiming that the price will eclipse a million dollars per coin. The new buzz-phrase going around the Bitcoin community is that “the singularity is here,” implying that Bitcoin is on a rapid path to becoming the new world currency. The sobering economic reality, at least for the time being, is that Bitcoin’s potential cannot quickly satisfy investors’ euphoric expectations. Bitcoin’s current technology is not capable of anything even close to Visa-level transaction traffic.

Because fiat paper currencies are ultimately doomed, EWT argued in 2010 that Bitcoin and its revolutionary properties are here to stay. Events like the confiscation of bank accounts in Cyprus illustrate the need for an unsulliable currency such as Bitcoin, but a significant correction in Bitcoin’s price is highly probable. The BTC bubble is clearly entwined in the “all the same market” top of a Grand Supercycle, and the near-vertical rise of recent days and weeks indicates that a price decline is likely to be deep. Nevertheless, Bitcoin is invulnerable to government-run printing presses. Long term, this facet should prove beneficial to Bitcoin’s ultimate success despite near-term risks.

Bitcoin Bust

Five days after the release of this article, Bitcoin crashed 61% over 2 days:

Gain more insights like these when you subscribe to The Socionomist Learn more about The Socionomics Membership now.

Socionomics InstituteThe Socionomist is a monthly online magazine designed to help readers see and capitalize on the waves of social mood that contantly occur throughout the world. It is published by the Socionomics Institute, Robert R. Prechter, president; Matt Lampert, editor-in-chief; Alyssa Hayden, editor; Alan Hall and Chuck Thompson, staff writers; Dave Allman and Pete Kendall, editorial direction; Chuck Thompson, production; Ben Hall, proofreader.

For subscription matters, contact Customer Care: Call 770-536-0309 (internationally) or 800-336-1618 (within the U.S.). Or email

We are always interested in guest submissions. Please email manuscripts and proposals to Chuck Thompson via Mailing address: P.O. Box 1618, Gainesville, Georgia, 30503, U.S.A. Phone 770-536-0309. Please consult the submission guidelines located at

For our latest offerings: Visit our website,, listing BOOKS, DVDs and more.

Correspondence is welcome, but volume of mail often precludes a reply. Whether it is a general inquiry, socionomics commentary or a research idea, you can email us at

Most economists, historians and sociologists presume that events determine society’s mood. But socionomics hypothesizes the opposite: that social mood regulates the character of social events. The events of history—such as investment booms and busts, political events, macroeconomic trends and even peace and war—are the products of a naturally occurring pattern of social-mood fluctuation. Such events, therefore, are not randomly distributed, as is commonly believed, but are in fact probabilistically predictable. Socionomics also posits that the stock market is the best available meter of a society’s aggregate mood, that news is irrelevant to social mood, and that financial and economic decision-making are fundamentally different in that financial decisions are motivated by the herding impulse while economic choices are guided by supply and demand. For more information about socionomic theory, see (1) the text, The Wave Principle of Human Social Behavior © 1999, by Robert Prechter; (2) the introductory documentary History's Hidden Engine; (3) the video Toward a New Science of Social Prediction, Prechter’s 2004 speech before the London School of Economics in which he presents evidence to support his socionomic hypothesis; and (4) the Socionomics Institute’s website, At no time will the Socionomics Institute make specific recommendations about a course of action for any specific person, and at no time may a reader, caller or viewer be justified in inferring that any such advice is intended.

All contents copyright © 2023 Socionomics Institute. All rights reserved. Feel free to quote, cite or review, giving full credit. Typos and other such errors may be corrected after initial posting.