When Bitcoin was trading above $60,000, smart analysts and financial thinkers told investors that the price of BTC would not fall below its previous highs.
These same individuals said that $50,000 was an opportunity to buy an investment opportunity, then $35,000 was an opportunity to buy a generation. Later, they pointed out that BTC will never fall below $20,000.
Of course, “now” is a great time to buy a dip, and one would think that buying BTC at $10,000 or less is the purchase of a lifetime. But now all the so-called “experts” are nowhere to be seen and heard.
So, investors are left to their own whims and fancies to ponder whether or not to bottom out. Should one be patient and wait for the forecast to “drop to $10,000” or is it time to buy Bitcoin and altcoins?
In general, it is futile to call price slabs. The most important thing to focus on is whether or not there are fundamental reasons for choosing to invest in Bitcoin.
Sure, the price has changed a lot, but have the fundamentals of the Bitcoin network and the infrastructure around Bitcoin improved or degraded? Highlighting this information is important because for investors, this is where one should get their confidence and investment research.
This is exactly why Cointelegraph a Twitter sites with analysts Joe Burnett of Blockware Solutions and Colin Harper of Luxor Mining. Here are a few highlights from the discussion.
Stock markets will determine when the price of Bitcoin can “bounce back”.
According to Joe Burnett, an analyst at Blockware Solutions, the impact of the price of Bitcoin on Federal Reserve policy and equity markets is significant. Burnett said:
“The macro environment is weighing heavily on the price of Bitcoin. High CPI inflation from November 2021 has led to a strong Fed. High interest rates will inevitably cause all assets to fall. Interest rates are essentially a gravitational force on financial assets, essentially a discounted cash flow analysis. And These rising interest rates are an attempt by the Fed to kill demand and suppress inflation, putting pressure on all risk assets, including Bitcoin.
When asked about the Bitcoin hash ribbons on-chain indicator of BTC going down and miners confirming that there is a Bitcoin bottom, Burnett said, “I think every metric like on-chain, you definitely have to take it with a grain of salt. You can’t look at it in a vacuum and say, yeah, Bitcoin’s bottomed out.” .
“If U.S. stocks make new lows, I expect Bitcoin will certainly follow. That being said, I mean, if you’re looking at Bitcoin fundamentals, I think small statements typically signal a Bitcoin bottom. And the hash-driven indicator that Charles Edwards created basically shows that there will be mining this summer.” .
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The combination between Big Energy and Bitcoin miners is a great positive for BTC.
Discussions about growing partnerships between large energy providers, oil and gas companies, and industrial-scale Bitcoin miners have been a hot topic in 2022.
“I don’t think mining will do anything bad or good for Bitcoin. I think in the long run it will strengthen the security of the network, decentralize the mining and if you have power producers, it will put you in the corner of the mine like any other. But in terms of actually doing anything about the price, I think that’s just like a broad adoption issue. And people may or may not use it day-to-day as a commodity, store of value, and general investment.
Harper explained, “It’s going to be more interesting if these companies start mining. It will be less isolating. Based on this, I guess the fuel supplier and that person’s politics.
When asked what the future of Bitcoin mass adoption might look like in relation to the growth of the mining industry, Harper said:
“It’s only a matter of time before they start integrating bitcoin into their stack. And I think things will get interesting in terms of mining as an industry because if you have energy producers and people who own energy mining bitcoin, that makes it very difficult for people who don’t have those assets to eventually turn a profit. Because you’re already going to see the price of the hash sell backwards. Eventually, you can imagine a future where only energy producers and those who invest with energy producers or profit from their bitcoin mining.
The growing demand for regulation and self-regulation will lead to the development of the Bitcoin Lightning Network
Both analysts agree that the growth potential of Layer-2 Bitcoin is bright, although it may take a few years. As Burnett predicted, “Over time, more and more people will learn that they want their Bitcoin to be the final settlement, which means more people will hold their own keys.”
According to Burnett:
“If Bitcoin adoption grows by 100x or 1000x, there will be a lot of competition for small block space and on-chain fees will probably go up just because people are asking for more settlements, which will increase the amount of settlements on the base layer. But the location of the block is adjusted to place it on the base layer. So these on-chain charges are basically what I think the Lightning Channel might already be open and available for. It makes it more valuable.
Harper wholeheartedly agrees, adding that, in his opinion, the Lightning Network is “what will enable Bitcoin to serve as a global medium of exchange and, as Jack Mallers put it, something that can differentiate Bitcoin.” , an asset from Bitcoin, in a way that the payment network can actually scale.
Scan it To listen here Full chat to Twitter Space.
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