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Bitcoin Bottom — Is It Still There? Analysts Discuss Factors Affecting BTC Price

When Bitcoin was trading above $60,000, the smartest analysts and financial minds told investors that the price of Bitcoin would never drop below its previous high.

These same individuals also said that $50,000 is a dip buying opportunity and $35,000 is an intergenerational buying opportunity. They then suggested that BTC would never drop below $20,000.

Of course, “now” is a great time to buy a dip, and you’d think that buying BTC for under $10,000 would also be a once-in-a-lifetime purchase. Silent, nowhere to be seen or heard.

Investors are therefore left to their own devices and thoughts as to whether the bottom is in. Should I be patient and wait for the forecast to drop to $10,000, or is this the time to buy Bitcoin and Altcoins?

In general, calling the bottom of the price is a futile task. The really important thing to look at is whether there is a fundamental reason for choosing whether to invest in Bitcoin or not.

Sure, prices have changed a lot, but have Bitcoin’s network fundamentals and the infrastructure surrounding Bitcoin as an asset improved or degraded? It’s important to expand on this data. . Because for investors, this is where you should source your confidence and your investment thesis.

This is exactly what Cointelegraph Twitter Space with Analysts Joe Burnett of Blockware Solutions and Colin Harper of Luxor Mining. Here are some highlights from the conversation.

The Stock Market Will Decide When Bitcoin Price Can ‘Bounce Back’

According to Blockware Solutions analyst Joe Burnett, Bitcoin’s price is heavily influenced by Federal Reserve policy and its impact on the stock market. Mr Barnett said:

“The macro environment is clearly weighing on the price of Bitcoin. High CPI inflation has forced the Fed to act aggressively since November 2021. Rising interest rates will inevitably push all assets into Interest rates are basically the gravity of financial assets, basically a discounted cash flow analysis, and these rate hikes are an attempt to destroy demand and destroy inflation by the Fed. , there is pressure on all risk assets, including Bitcoin.”

When asked about the Bitcoin hash ribbon on-chain indicator suggesting that BTC has bottomed out, Burnett said: a grain of salt. You can’t look at it in isolation and say that Bitcoin has bottomed out. ”

Mr Barnett said:

“If U.S. stocks hit new lows, I am confident Bitcoin will follow suit. I think it marks the bottom of the coin, and a hash-driven indicator created by Charles Edwards basically shows that there has been a miner surrender this summer.”

RELATED: Canaan Executive Says Opportunity Outweighs Crisis As Bitcoin Miners Suffer Shrinking Profits

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

Discussions about expanding partnerships between major energy providers, oil and gas companies, and industrial-scale Bitcoin miners will be a hot topic throughout 2022, and were asked about the direct benefits of this relationship with Bitcoin itself. When Colin Harper said:

“I don’t think mining is good or bad for Bitcoin. I think it’s good for bitcoin in the sense of putting bitcoin on every corner. But I think it’s kind of a broader adoption case in terms of actually doing something to the price. , on whether people routinely use it as a medium of exchange, a store of value, and just a general investment.

“Once these companies start mining, it will be tastier,” Harper said. “There will be less stigma.

When asked about what the future of mass Bitcoin adoption looks like in relation to the growth of mining, Harper explained:

“It is only a matter of time before they start integrating bitcoin into their stack. If there are producers of energy and people who own the energy mining bitcoin, the people without those assets will eventually benefit. It will be very difficult to go up because you will see hash prices that are already trading in backwardation.In the end only energy producers and those who are invested or embedded in energy producers , we can imagine a future where we can actually make a profit from bitcoin mining.”

Growing Desire for Regulation and Self-Control Drives Bitcoin Lightning Network Growth

Both analysts agreed that the growth potential for Layer 2 Bitcoin is bright, although it may take years. “We will learn to demand formal payments, and more people will hold their own keys.”

According to Burnett:

“A 100- or 1000-fold increase in Bitcoin adoption could drive up on-chain fees as competition for scarce blockspace becomes more intense and people demand more payments. There is, however, a fixed amount of blockspace to put on the base layer, so these on-chain fee hikes basically, in my opinion, increase the liquidity potential of the already open and available lightning channels. It will be more valuable.”

Harper wholeheartedly agreed, adding that, in his opinion, the Lightning Network “allows Bitcoin to be used as a global medium of exchange and, as Jack Mallers put it, is also what allows Bitcoin to be decoupled.” I was. , a Bitcoin asset, a payment network in a truly scalable way. ”

tuning listen here For full Twitter Space conversations.

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