After plunging below $8,000 on Friday in what looked like the second “beginning of the end” moment of 2018 (there was one in January too), everyone’s favorite digital delusion managed a feeble attempt at a bounce, but these dip-buying episodes have been noticeably harder to sustain of late.

Sure enough, on Sunday afternoon, Bitcoin fell back below the $8,000 mark in Coinbase pricing:

As you’re probably aware, the bad news is piling up fast. Over the past two weeks, traders have had to stomach the Coincheck theft, the CFTC subpoenaing Bitfinex and Tether, India’s finance minister Arun Jaitley vowing to “eliminate” the use of crypto assets, and a ban on crypto purchases using credit cards issued by JPMorgan, BofAML, and Citi.

Now, hedge funds are starting to pile on. According to the latest CFTC report, leveraged funds’ short positions in CBOE Bitcoin futs increased fivefold in the week through Tuesday, while long bets plunged 22%. Nouriel is pleased:

Hedge funds shorting big-time Bitcoin in futures market. That will help counter the cryptocrazies longs manipulating the price upwards and doing systematic wash trades.... https://t.co/gQU5MXFENe

— Nouriel Roubini (@Nouriel) February 4, 2018

As a reminder, Roubini has embarked on a veritable crusade this week, blasting Bitcoin as the “biggest bubble in human history” in an interview with Tom Keene and Francine Lacqua on Bloomberg Television. He also said this about blockchain in case you missed it:

It’s been around for 10 years, and the only application is cryptocurrencies, which is a scam.

If you want to get an idea of how pot-committed the crypto crowd is, go and read some of the responses to Roubini’s tweet embedded above.

One thing I would encourage the Bitcoin crowd to at least consider is the possibility that Bitcoin is not in fact “digital gold” but rather represents something closer to the riskiest of all assets – “the new frontier in risk-taking” to quote a recent Deutsche Bank note.

If that’s the case, it would be extremely vulnerable to a reversal in retail investor sentiment tied to any continuation of the equity market rout that accelerated on Friday afternoon.

Fair warning.

i keep trying to remind all the Bitcoin bears to be extra careful because it's got a lot of support at $0

— Walter White (@heisenbergrpt) February 4, 2018