Bitcoin: Three Reasons for Growth
Can the price of bitcoin again become $ 20,000 or arrange a native and grow immediately to $ 100,000? In this article, we will analyze three ways for the growth of the Bitcoin exchange rate in light of the onset of the unplanned crisis 2020 . How halving will affect the course of the first cryptocurrency, why the current crisis can put Bitcoin above gold and when FOMO appears again.
In this article, we will discuss how the sales of BTC miners really affect the cryptocurrency market. How much gold is sold on the market and does it really have limited emissions, as promised. And what should be the price of bitcoin in order for a new FOMO wave to start and a native will happen.
The countdown to the third bitcoin halving is already going on for days and, as the cryptanalyst B claims, there will be a serious incentive for the price increase, because earlier on the day miners mined about 1,800 new bitcoins, and now their number will decrease to 900 coins:
Whoever has not heard, PlanB is the creator of the model Stock to flow bitcoin, which displays the dependence of price on the rate of issue of new coins. Now it just indicates the next strong price movement in the range of $ 100,000 as a result of the third bitcoin halving .
In her defense, I must say that she successfully worked throughout the history of bitcoin. However, there is no guarantee that this will continue in the future, because such an approach to valuing the value cannot protect the asset from strong shocks, for example, a government ban or a special dump by large players. We say this not because we do not believe in bitcoin, but because we want to draw your attention to the presence of potential risks in the cryptocurrency market.
It is also important to note that reducing the daily issue of bitcoin as a result of halving from 1,800 to 900 coins is not a guarantee that miners will immediately drop fewer coins on the market.
There are two important points: first, the sales of miners depend on the cost of mining bitcoin - the higher it is, the more cryptocurrencies they are forced to sell to cover their own costs.
Secondly, it is much more profitable for miners to sell bitcoins through over-the-counter platforms for large buyers with a margin of about 25% of the market rate.
But specifically at the moment, many miners, according to the miners themselves, are just on the verge of working at zero and are obliged to sell almost all of the mined cryptocurrency. Therefore, PlanB is partly right and the flow of new bitcoins immediately after halving should be reduced.
In light of the economic crisis, Bank of America made a forecast 19459010] the price of gold, and claims that a new historical maximum price of $ 3,000 is possible soon. Bitcoin supporters immediately noted that for the first cryptocurrency this should be a great chance to prove that it is not in vain called digital gold. Here is what billionaire Tim Draper thinks about this:
“Such a frantic flow of new money to the markets will reduce their value. At the same time, the number of bitcoins will always be 21 million. BTC is safe in the sense that no one will dilute it with its political manipulations. Gold is great for jewelry and is used in the manufacture of certain types of electronics. But it is bulky and heavy. Buy a cup of coffee for gold just does not work. Therefore, bitcoin is much easier to use as a currency. ”
There is nothing unexpected in these words of Tim Draper. We have repeatedly said that the scope of Bitcoin adoption is constantly growing, and it has long been used as a means of payment. But if you have a gold bar, then just do not buy bread at the store with it.
We constantly swear at the Central Banks and fiat currencies, because the former issue the latter in unlimited quantities. And you definitely know about the 10% rule that the bank holds in its assets, and the rest of your money in the amount of 90% of the account balance has long been put into circulation.
That is, of the money that is indicated in the balance on the card, the bank is actually only a small part. The calculation is that all customers will never come to collect their money at the same time, so when you receive a salary and immediately transfer it to the bank in cash, everything is fine. After all, people like you are no more than 10%, and the rest entrust the storage of their money to the bank and therefore you can always overlap from someone else's pocket.
What do you think, can the same thing happen to gold? After all, his main advantage is limited emissions? Do you think all the gold that is now traded on exchanges does it exist or not?
The trick is that the market now has a lot of so-called "paper gold", which is provided by shares of gold mining companies or the metal that is still hidden in the ground. People buy “paper gold”, because it does not need to be stored on its own and can always be quickly converted into cash through the exchange.
But in practice, if all owners of such a precious metal want to take their bullion, then this gold will have to be dug out of the ground for several decades. So it turns out that the gold actually bought on the exchange and stored on your account is not much better than the numbers in online banking.
Bitcoin is insured against such manipulations, because only 21 million coins will be issued, and you can check the presence of each of them and use it at any time. Bitcoin is the most transparent financial system in the world, but since money is involved in it, then there are psychological factors for price increases.
The loss of profit syndrome was largely the reason for the growth of bitcoin to $ 20,000 in December 2017 and now he can again say his weighty word. The factors cited earlier in the article indicate stimulation of the exchange rate, which should remove it from the current price range and lead to a new historical maximum.
We dare to assume that this time FOMO will have several stages. So when Bitcoin is released above $ 10,000, those who are still waiting for cheap bitcoins for $ 5,000 and below will start buying.
Then, after we break through $ 15,000, people who were severely punished during the collapse in the first half of 2018 will join us. But seeing a chance to again take $ 20,000 for a coin, many of them will try to recoup.
And the third stage should begin after passing the mark of $ 20,000, and most likely even $ 30,000. Then hysteria around bitcoin will again become mass, and everyone will want to hit the jackpot and go to a new native. And do not care that it was good to buy yesterday.
Then emotions will speak for people, and the most important thing for you and me will not be pulling to the last, but in time to take profits. Because the transition from parabolic growth to a new collapse will be unexpected and inevitable. But you still need to live up to those events, so for now you can not really worry about them.