Bitcoin Bottom – Are We There Yet? Analysts discuss factors affecting BTC price

Bitcoin Bottom - Are We There Yet?  Analysts discuss factors affecting BTC price
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When Bitcoin was trading above $60,000, the smartest analysts and financial minds told investors that the price of BTC would never fall below its previous high.

The same individuals said $50,000 was a buying opportunity and then said $35,000 was a generational buying opportunity. They then suggested that BTC would never fall below $20,000.

Of course, “now” is a great time to buy a dip, and arguably, buying BTC at or below $10,000 is also the buy of a lifetime. But by now all the so-called “experts” have gone quiet and are nowhere to be seen or heard.

So investors are left to their own devices and thoughts to wonder if they are bottoming out. Should we be patient and wait for the “fall to $10,000” prediction, or is now the time to buy Bitcoin and altcoins?

In general, calling the bottom of prices is a pointless task. The main thing to consider is whether or not there are good reasons to invest in Bitcoin.

Sure, the price has changed dramatically, but have the network foundations of Bitcoin and the infrastructure surrounding Bitcoin as an asset improved or deteriorated? It’s important to nurture this information because it’s where the confidence and investment thesis for investors comes from.

That’s why it hosted Cointelegraph Twitter Spaces with analysts Joe Burnett of Blockware Solutions and Colin Harper of Luxor Mining. Here are some highlights from the conversation.

Stock markets will decide when the price of Bitcoin can “bounce back”.

According to Blockware Solutions analyst Joe Burnett, the price of Bitcoin is heavily influenced by Federal Reserve Policy and its impact on stock markets. Burnett said:

“The macro environment is clearly weighing heavily on the price of Bitcoin. High CPI inflation has prompted an aggressive Fed from November 2021. Higher interest rates inevitably cause all assets to fall. Interest rates are basically a weighting of financial assets, not simply a discounted cash flow analysis. And these rising interest rates are an attempt by the Fed to destroy demand and destroy inflation. This clearly puts pressure on all risk assets, including Bitcoin.”

When asked about the chain indicator of Bitcoin hash tapes, which show that BTC is going down and that miners are giving up confirming that Bitcoin is in the bottom, Burnett said, “I think with any likes in a chain-type metric, you definitely have to take that with a grain of salt. You look at it in a vacuum and say don’t you know that yes, bitcoin’s bottom is in”.

Burnett said:

“If US stocks make new lows, I certainly expect Bitcoin to follow. However, I mean, if you look at the fundamentals of Bitcoin itself, I think small capitulations usually mark Bitcoin bottoms. And the hash-based indicator created by Charles Edwards basically shows miners giving up this summer.”

Related: Opportunity outweighs crisis as Bitcoin miners grapple with shrinking profits, Canaan executive says

The synergy between Big Energy and Bitcoin miners is a net positive for BTC

Discussing the growing partnership between major energy providers, oil and gas companies, and industrial-scale Bitcoin miners A hot topic throughout 2022and when asked about the direct benefits of this connection to Bitcoin itself, Colin Harper said:

“I don’t think mining is doing anything bad or good for Bitcoin. I think this is good for Bitcoin in the sense that it will actually strengthen network security in the long run, centralize mining, and make it basically the same as anywhere else in the world if energy producers mine it. But in terms of actually doing something for a price, I think it’s a broader adoption thing. As for whether or not people will use it every day as a medium of exchange, a store of value, and just a general investment.

Harper elaborated, “If these companies start taking it out, then it’s more palatable. It is less stigmatized. I guess depending on the oil producer and that person’s politics.”

When asked what Bitcoin mass adoption might look like in the future with the growth of the mining industry, Harper explained:

“It will only be a matter of time before they start integrating Bitcoin into their stacks. I think that’s where things get interesting in terms of mining as an industry, because if you have energy producers and people who own energy mining Bitcoin, it makes it very difficult for people who don’t have those assets to ultimately profit. because you will already see the hash price trading backwards. Finally, you can imagine a future where only energy producers and those who invest in or join energy producers can actually profit from bitcoin mining.

The growing desire for regulation and self-policing will drive the growth of the Bitcoin Lightning Network

Both analysts agreed that although it may take several years, Bitcoin-2’s growth potential is bright. Burnett predicted that “over time, more and more people will learn to demand final settlement of their Bitcoins, meaning more people will hold their own keys.”

According to Burnett:

“If Bitcoin adoption increases by 100x or 1000x, there will be more competition for limited block space, and on-chain payments will likely require people to settle more because it will require more settlement in the base layer. But the block space for the base layer is fixed. “So the increased on-chain payments, in my opinion, will potentially create liquidity for the lightning channel that is already open and available. This will make it more valuable.”

Harper agreed wholeheartedly, adding that he thinks the Lightning Network “will be what allows Bitcoin to be used as a worldwide medium of exchange, and also, as Jack Mallers said, it’s what could sort of separate Bitcoin from Bitcoin.” an active, truly scalable payment network.”

Adapt here to listen To the full conversation of the Twitter space.

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