Bitcoin: Dead Coin Bounce?
Market Thoughts From Our CEO
Dead coin bounce? Hardly. Apologies for the clickbait title, but it’s intentional and warranted to address the clickbait I see everywhere these days. Let’s be real here. Bitcoin is not dead, nor is it dying. And there’s no dead cat bounce going on either.
The Bitcoin market is inherently volatile, however…
To the extent Bitcoin fundamentals can be identified and relied upon, some key fundamentals are currently favorable for a Bitcoin rally. Some primary fundamentals I see are:
1) Volume of trading has decreased at the lower price trades, indicating a reduction in selling pressure;
2) China’s ban on Bitcoin mining solves an issue that has plagued the cryptocurrency, since China’s previous two-thirds share of the Bitcoin mining business will no longer be conducted in the authoritarian state and is now moving to more favorable jurisdictions, including Texas;
3) Holders (yeah OK… HODLers) of Bitcoin are presently buying more, showing that those with the most intimate understanding of the coin are bullish;
4) Elon Musk, who has been moving the market by playing with his food, has renewed his interest in accepting Bitcoin for Tesla sales; and
5) El Salvador’s legislation to make Bitcoin mandatory legal tender raises interesting questions in its own jurisdiction and others, all of them positive for Bitcoin.
To the extent chart indicators can be relied upon, the Bitcoin chart also looks good. After an exuberant run up this year, Bitcoin has retraced to about half its previous highs and has now been trading in a sideways channel for a month. This is a healthy chart for the bulls, indicating a likely new bottom formation. Bitcoin $65,000 was frothy, so a pullback was warranted and expected, and price consolidation in a sideways channel (even if a little broad of a trading range, in this case) is a positive response from the market. If this sideways channel holds, and if we see a multi-day breakout above $41,000, I would expect Bitcoin to resume its climb and supremacy.
I’m bullish on Bitcoin in the long run because it avoids the pitfalls present in today’s vacuous and devaluing central bank currencies. You can’t just print money indefinitely like the central banks are doing, and I think most people understand that fact. There will never be more than 21 million Bitcoins, and that cap on global supply preserves price integrity while the fiat currencies devalue every day.
The future of stores of value is digital and blockchain-based. I think everyone in finance understands this by now. The only real issue is that cryptocurrencies are still highly volatile. I’m presently holding nothing but crypto. I’m diversified among Bitcoin, Ether and MINER. I only keep enough USD, EUR, CDN, etc. to pay immediate bills that can’t be paid with Bitcoin. Everything else stays in crypto.
I like Bitcoin and Ether because they’re the industry leading cryptocurrencies, they are up some 200 percent a year versus fiat currencies, and they stand a chance at huge price improvements.
MINER is different from the other two. It has all the functional benefits of a crypto-asset with a stable floor of value. While Bitcoin could technically go to zero, MINER really can’t. MINER tokens can be redeemed for the service of gold mining and delivery of 24 karat gold bars, so it has an inherent value not present in Bitcoin or Ether. MINER is designed to be the safest store of value in an uncertain global economy.
We developed MINER to protect your wealth. A mix of Bitcoin, Ether and MINER is the strategy for weathering the economic storm that’s brewing.
Christian Goodell, CEO
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