What may need to happen for the price of Bitcoin to bottom
Bitcoin has been trending lower all year, and it may not be done yet.
If you bought bitcoin almost at any point in the last 8 months you are likely down on your money.
In fact, if you bought bitcoin just about at any point in 2018, you are likely down on your money:
If you were one of the lucky few that picked it up around $6k, you might be up a few ticks, but not much.
Not out of the woods yet?
According to the CEO of Bitmex, we still need to see something happen with Bitcoin that we haven't seen yet in order for it to bottom.
Arthur Hayes, the CEO of Bitmex, says that in order for Bitcoin to bottom it first needs to flush out the miners.
Prices need to get to a point where Bitcoin miners start turning off their machines and the difficulty rate on Bitcoin actually decreases.
In the past it was believed that hashrate preceded price, but perhaps it is price that precedes hashrate.
Why does Hayes think this needs to happen?
Mostly because that is what happened before.
In the bear market of 2014-2015, miners turned off their machines and several high profile miners actually went under.
The difficulty rate even decreased for a short time.
Then, 7 months later, after a prolonged period of sideways movement, prices began rising again.
Hayes says we likely need to see something like that happen again for a real bottom to be in place.
That begs the question, at what price do miners turn off their machines?
The answer to that question likely depends on where you live.
According to Hayes we should look to China.
The average electricity cost of Chinese miners all-in is roughly 6 to 7 cents kWh. That would indicate that at $5,000 bitcoin, miners would start looking for cheaper places to operate.
However, to get them to shut off their machines completely and close shop, we would likely need to see prices in the $3,000-$4,000 range.
Then the key he would be looking for is seeing if hash rates actually drop.
At that point he says a real bottom can be put in place and we can start building a base for the next leg higher.
*Keep in mind that something like the SEC approving a Bitcoin ETF would likely throw his theory out the window.
More from Arthur Hayes can be found here:
https://us3.campaign-archive.com/?e=745c258920&u=db45c09bdf20e1866bb32123f&id=1da0bd867e
Stay informed my friends.
Image Source:
https://www.ccn.com/how-the-efforts-of-bakkt-could-lead-to-the-approval-of-the-first-bitcoin-etf/
Follow me: @jrcornel
Excellent content @jcornel 😁👍😁
Thanks.
And people were talking about 50.000 US by the end of 2018...
They aren't wrong yet. :)
True but I really don't see another bull run like the one last year happening this year...
It seems pretty unlikely, but keep in mind that Bitcoin was around $6,500 on November 13th, and hit $19,500 by December 17th. Which means it only took about 34 days for bitcoin to reach it's highs from where it currently is today...
Not saying I expect that, but I am saying it's possible because it has been done before. :)
Possible but highly unlikely
maybe it will..
It only took about 34 days for bitcoin to go from $6,500 to $19,500 last year. In that regard there is still plenty of time.
I doubt it
Personally I'm convinced we've hit a bottom and like a spring that has been compressed too tightly; #BTC will snap and we are about to see the largest bull run and an ATH of $25K+ transitioning towards mid Q4
especially around the holidays...
That is certainly possible and what I am hoping for as well.
That is certainly
Possible and what I am
Hoping for as well.
- jrcornel
I'm a bot. I detect haiku.
@jrcornel what do you thing ,what is the top bottom in this year ?
Honestly I would not be shocked to see $5k. I would also not be surprised to see the bottom already be in.
so it's already in bottom or may be down more, but definitely when it will rise it will be touch all time high, what's your opinion @jrcornel
That is my thoughts yes. But there is no guarantee.
Yes no one can guarantee of it's exact price
When btc hovered at 5800 usd I was hesitant to call a bottom. It was too brief. However there was consolidation and then a bounce. Then now...
It's increasing now, maybe one again it will down then started rising
I see no sign of a sustained run. A breach of the 50SMA is what I want to see and even then this wouldn't mean we've bottomed.
Then I need seriously advice from you 😧 should I buy bitcoin now or just wait to get its position in higher again in the currency market??
I wish I knew. My best advice is to buy half now and then if it does dip you buy the other half then. Either way you atleast have some money in.
buy now and wait.
I HOPE THAT THE BEST OF BITCOIN
I say we will see a long sideways move before finding that bottom... we have already seen companies turning off cloud mining contracts but do they shut down the machines? I think not so it will require as you said for some of those major players to close shop before we see a correction.... we may very well see a shift away from BTC dominance prior to the next bull run
Posted using Partiko iOS
Its a shame most of the break even prices were said to be around $8k globally. Now finding out the largest miner's breakeven price is a lot cheaper than that.
Yea I have been wondering about the comparison between BTC and BCH same group of miners can do either so will the switch play into the problem or defeat the problem... giant balancing act and I feel as if many larger players are wising up to control markets stopping they bull run mentality in its tracks realizing the potential for capital gains by having competition get flushed out through the lull
Posted using Partiko iOS
They may switch but likely neither would be profitable if the prices keep dropping.
True that, yet I don’t see a complete crash anywhere in the near future with so many options for movement and with last year’s big bump some must be using those profits in preparation to endure... I’m still bullish been buying and investing in STEEM the whole way down after riding it up and taking profits myself
Posted using Partiko iOS
What are you thinking about bitcoin currency in this year
I think it will go up again at some point.
etf works for cheaper prices ... I hope they shut down those damn miners lol I mean I want a cheap bitcoin..
How cheap are you looking for?
at least 3K
It's definitely possible, but might have been a coincidence. I expect the price to continue to stay around where we are right now at least for the next 6 months or so.
That is a long time. Not that much different than what others are saying either.