Bitcoin, Dogecoin and Ethereum are amongst the most famous cryptocurrencies. They’re similar to one another, but do have unique characteristics that set them apart, and it’s those differences that need to be understood when deciding whether to invest in Dogecoin, Ethereum or Bitcoin.

So, which cryptocurrency: Bitcoin, Ethereum, or Dogecoin? We take a closer look at each to help you get a better idea of the best crypto to invest in for 2022, taking into consideration their pros and cons and the current market conditions.

Bitcoin key facts

Year created: 2009

Market capitalisation (as of June 2022): $600.55 billion

Maximum coin supply: 21 million

Number of coins in circulation: 19 million

Bitcoin (BTC) was the first cryptocurrency, and remains the most popular, making up more than 66% of all crypto investments. Created by an anonymous developer acting under the pseudonym Satoshi Nakamoto, it can be used as either a currency or as a store of value.

When people think of cryptocurrency, they think of Bitcoin. Its rise has been meteoric, and despite the doubters and recent dips in price, it continues to be the gold standard amongst cryptocurrencies.

Since its creation, the growth of Bitcoin has been exponential. In 2010, Bitcoin was trading at $0.09. Some 11 years later the price had hit an all-time high of nearly $69,000. Although 2022 has been a particularly volatile year for Bitcoin with prices hovering around the $30,000 mark, experts have suggested Bitcoin could hit $100,000.

Ethereum key facts

Year created: 2015

Market capitalisation (as of June 2022): $236.18 billion

Maximum coin supply: Unlimited, though only 18 million can enter circulation each year

Number of coins in circulation: 120 million

The second-largest cryptocurrency after Bitcoin, Ethereum (ETH) is the brainchild of Vitalik Buterin and Gavin Wood. A decentralised, open-source blockchain network, Ethereum’s applicability goes much further than just as a cryptocurrency. 

The main difference between Bitcoin and Ethereum is that Ethereum is a ledger technology which can be used to build new decentralised programs, such as play to earn games, and decentralised exchanges, whereas Bitcoin is simply a cryptocurrency. Also, the actual name of the Ethereum cryptocurrency token is Ether, which the Ethereum technology underpins.

As with Bitcoin and many other cryptocurrencies, Ethereum is currently experiencing a downturn in its value. At the time of writing, the price of ETH sits at a little over $1,800, a 55% drop in the last six months. However, in the past two years alone ETH saw gains of over 1000%.

Dogecoin key facts

Year created: 2013

Market capitalisation (as of June 2022): $11.16 billion

Maximum coin supply: Unlimited, though 5 billion max can enter circulation each year.

Number of coins in circulation: 132 million

Developed by Billy Markus and Jackson Palmer in 2013, Dogecoin (DOGE) is an open-source cryptocurrency. It’s based on Litecoin and uses the same proof-of-work technology.

Dogecoin hasn’t been immune to the price drops seen in the cryptocurrency market either, but, much like Ethereum or Bitcoin, it has enjoyed dramatic price rises since it first hit the crypto scene.

Back in 2017 Dogecoin’s price was just $0.0002. By May 2022 it was trading at $0.08, an increase of nearly 40,000%. The dog-themed coin has proved a popular low-cost option for crypto investors, not least because of high-profile supporters like Elon Musk.

Which is the best crypto to invest in?

So, which is the best crypto to invest in? Bitcoin, Ethereum or Dogecoin? All have their pluses and minuses, and all have had their ups and downs in the crypto market.

Should I buy Ethereum or Bitcoin?

Let’s look at the two big players first: Bitcoin and Ethereum. Around 10 million people own Ethereum, making it the second most popular cryptocurrency next to Bitcoin. One thing Bitcoin and Ethereum have going for them is that they’re more established than the others, making them a good choice for those just starting out in the world of crypto investment.

Both are expected to maintain their leading positions in the cryptocurrency market for the foreseeable future, which begs the question. Which should you invest in? Ethereum or Bitcoin?

A major benefit Bitcoin has is its coin issuance limit. No more than 21 million bitcoin will ever be mined, and if demand continues to increase this will likely mean price rises. Both Ethereum and Dogecoin have an unlimited supply, which could negatively impact future demand. However, it should be noted that Ethereum has shown signs that it could become deflationary after network upgrades introduced token burning.

The future of Ethereum looks particularly rosy, and its planned upgrade to Ethereum 2.0 could be a game-changer. This upgrade will see the network move from a proof-of-work (PoW) to a proof-of-stake (PoS) mining protocol, making the blockchain faster and 7000 times more energy-efficient. In recent years its pace of growth has left Bitcoin in the dust and many expect this growth to only increase after “the merge” to Ethereum 2.0.

Should I buy Dogecoin instead?

What about Dogecoin? It’s a minnow compared to Ethereum or Bitcoin, but it does have its advantages. Comparing Dogecoin vs Bitcoin, Bitcoin would appear to have the upper hand in most regards. It’s the market leader and has a far higher value, but Dogecoin’s fast processing times and low transaction costs make it an attractive choice too.

If you’re looking for the best cheap crypto to invest in, Dogecoin is definitely worth considering. Its detractors claim its value is subject to the whims of a few famous names, most notably Elon Musk, but it has strong community backing too, and their influence shouldn’t be underestimated. 

Out of the three, Dogecoin is undoubtedly the more speculative option, so any investment should be made with caution. There is huge potential in Dogecoin, but pitfalls await those who fail to do their research.

If you can’t decide whether to invest in Dogecoin, Ethereum or Bitcoin, then why not invest in all three? Diversifying has always been the key to a healthy investment strategy in traditional investments and the same can be said for the crypto market too.

As always, this article doesn’t constitute financial advice and you should do your own research and consult a professional financial advisor before making any investment decision.

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As the dust settles following a massive crypto crash that saw Bitcoin’s value fall to $26,766 on Thursday 12th May (close to a 50% fall from its November 2021 peak), we analyse what caused this drop, ask is it really worth buying the dip at this time of crisis, and will crypto recover?

Has crypto crashed before?

Of course! Just like traditional financial markets the cryptocurrency market has most definitely crashed before and investors are well acquainted with dips in such a volatile market as cryptocurrency. 

One of the biggest crashes in recent years was most definitely the 2018 cryptocurrency crash. 

Known as the great crypto crash, January 2018 saw the price of Bitcoin fall by 65% after an unprecedented boom in 2017. The crypto market steadily regained its composure and by December 2018, Bitcoin’s value had recovered to what it had been exactly a year before. As predicted though, this was not the last crypto crash. Fast forward to 2022.

2022: Why is crypto crashing?

There are several theories. Let’s break them down:

1. It reflected the decline in the wider financial markets

As crypto markets ballooned over recent years they have become intrinsically tied with the broader financial markets. As reported by outlets such as the BBC, the crypto market is following in the footsteps of major stocks such as the DOW and the S&P 500 in the US, which in May 2022 recorded their longest weekly losing streak since the 2008 financial crisis, sinking for six consecutive weeks.

It is believed that the cryptocurrency market reflected this drop because, in recent years, investors in the cryptocurrency market stopped being the domain of independent investors and niche enthusiasts. 

Rather, big-time investors that use hedge funds and money managers have now widened their investment portfolio to include trading in cryptocurrencies, showing a growing trend where the cryptocurrency market reflects shifts in the wider financial market. 

It is widely believed these large investors treat crypto as a risk-on asset, and pull their funds when they fear a broader market pullback.

2. It’s TerraUSD’s Fault

TerraUSD, then the third largest stablecoin, and the largest algorithmic stablecoin, imploded in the same week. 

Why was this a problem? Well, as the name suggests, stablecoins are intended not to fluctuate in value and many traders use such coins to buy other cryptocurrencies. 

TerraUSD, as opposed to most stablecoins, was not backed by cash or other more traditional and stable assets. 

Its stability came from algorithms that linked its value to a sister cryptocurrency called Luna which lost almost its entire value. 

This caused a domino effect on other stablecoins, (Tether briefly fell as low as $0.95 from $1) that in turn left its mark on major cryptocurrencies such as Bitcoin and Ethereum.

What should you do now that prices are low?

As most crypto veterans know, there are two things you need to do now.

If you already hold cryptocurrencies with a declining value:

Keep calm and hodl on. 

If you have a number of coins that are declining in value, then ignore the urge to sell and hodl on. 

It is a good idea to look at what happened in the past when crypto has taken a beating and remind yourself that the market did in fact recover.

Holding on to your coins instead of selling them off during a dip means you will have a greater chance of regaining a considerable return on investment in the long run.

Consider buying the dip

Buying the dip is definitely trending at the moment and you might be wondering whether to go for it or not. 

Buying the dip means buying when the price of an asset is lower than its usual market value. Buying low and selling high is a tried and tested investment strategy and is worth looking into when the crypto market is crashing. 

Whether you should buy the dip or not hinges on one fact: when and if the market will recover. 

This brings us to our next question.

Looking ahead: Will crypto recover?

As usual, there are mixed reviews. Some investors say that despite such a rocky start to the year, Bitcoin will still hit the $100,000 mark by December 2022. They cite increased demand due to continuous mainstream adoption and major corporations’ interest in the digital metaverse as the main reasons.

On the other hand, shifting monetary policies in the U.S., the war in Ukraine, and high inflation will continue wreaking havoc on all financial markets, especially in such a volatile one as the crypto market.

Past experiences have shown us that Bitcoin and other cryptocurrencies have come back stronger than ever from every crypto crash ever experienced. The optimism expressed by enthusiasts worldwide is already driving the value of major cryptocurrencies higher. 

However, the future does remain uncertain so, as always, make sure that you do not take any spontaneous actions based on emotions alone, keep a close eye on the news, and consider buying the dip while we ride this wave out.

As always, this article does not constitute financial advice and you should be sure to do your own research and consult a professional financial advisor before making any investment decision.

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In an unanticipated move, representatives from 44 Central Banks gathered in El Salvador last week. The representatives interacted with local Bitcoin adopters to potentially understand its advantages.

During the same week, Ethereum developers at the Permissionless conference provided a date for the long-awaited Proof-of-Work to Proof-of-Stake Merge. 

Elsewhere, Dubai renewed its focus on becoming the next metaverse powerhouse and a luxury watchmaker confirmed that it would begin accepting cryptocurrency payments.

• El Salvador hosts 44 countries to discuss Bitcoin adoption
• Ethereum developer suggests an August launch for The Merge
• Dubai creates a new committee in bid to become a hub for the metaverse
• TAG Heuer begins to accept cryptocurrency payments in US

El Salvador hosts 44 countries to discuss Bitcoin adoption

On Monday, the President of El Salvador, Nayib Bukele, confirmed via tweet that 32 central banks and 12 financial authorities would be meeting in El Salvador to discuss a range of technology-focused topics, including the adoption of Bitcoin.

President Bukele went on to list all 44 countries attending the event, which included Paraguay, Angola, Madagascar, Jordan, the Maldives, and Egypt. 

In September 2021, El Salvador became the first country to adopt Bitcoin as legal tender alongside the country’s primary currency, the US Dollar. Residents of El Salvador can now legally use BTC to pay debts and taxes. 

Since adoption, the country’s treasury has accumulated over 2300 BTC for its reserves, which includes a recent 500 BTC purchase.

The meeting of central banks took place at El Salvador’s Financial Inclusion and Funding for SMEs conference, which is focused on improving a range of industries and sectors with technological innovation.

According to reports, while attending the conference central bankers took the opportunity to interact with locals in El Salvador to determine how the adoption of Bitcoin had been handled. Officials met Mama Rosa, one of the first local retailers to start accepting Bitcoin in 2019, and another Bitcoin enthusiast helped them buy a coconut using BTC.

In an encouraging sign for cryptocurrency enthusiasts globally, a Twitter account for the famous Salvadoran Bitcoin Beach posted a video showing the central bankers from all 44 countries shouting the word “Bitcoin”.

Ethereum developer suggests an August launch for “The Merge” 

At last week’s Permissionless conference, which took place in Palm Beach, Florida, Ethereum developer Preston Van Loon, confirmed on stage that the Merge of the Ethereum blockchain was likely to happen in August 2022.

The Merge, which has been the name given to the moment in time when Ethereum transitions from a Proof-of-Work (PoW) blockchain to Proof-of-Stake (PoS), was postponed in April 2022. 

Although Ethereum developers had originally anticipated completion of the Merge by the end of Q2, Lead Developer, Tim Beiko, revealed that a Q3/Q4 implementation was more likely. 

However, news from the Permissionless conference could mean that Ethereum enthusiasts will not need to wait as long as Q4. According to Van Loon, August could be a realistic target “if everything goes according to plan.” Van Loon continued, “it just makes sense. If we don’t have to move [the difficulty bomb], let’s do it as soon as we can.”

A similar sentiment was shared by other Ethereum developers that attended the event. Justin Drake, an Ethereum researcher said that he had a “strong desire to make this happen before the difficulty bomb in August.”

The difficulty bomb is a piece of code that will slow down the Ethereum PoW blockchain and encourage miners to swap over to the new PoS network. Before that point, all client developers need to be sure that they can transition to the new mainnet.

If the Merge occurs in August, the Ethereum blockchain will begin to implement the Proof-of-Staking consensus mechanism. The switch is set to make Ethereum 99% greener by reducing energy consumption on a vast scale.

Following a successful launch, the focus will then be on the implementation of shard chains which is the technology that could greatly enhance speed and lower transaction costs. On the Ethereum roadmap this is currently scheduled for early 2023.

Dubai creates committee in a bid to become a hub for the metaverse

In early May, Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates, and Ruler of Dubai, announced that a higher committee would be created to oversee the Dubai Metaverse Strategy.

According to reports, the Dubai Metaverse Strategy seeks to solidify Dubai’s position as a center for metaverse technology and advancement. At the time Sheikh Mohammed explained, “we seek to transform Dubai into the world’s best city in the world to live, work, and invest. The constant development of government services is vital to achieve this goal and ensure Dubai maintains high levels of global competitiveness”.

The higher committee is led by Dubai Crown Prince, Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum who last week confirmed that a sub-committee had been created to track all developments within the digital ecosystem, including trends within the metaverse.

In an interview conducted with local news agency Wam, Sheikh Hamdan said, “The directives of Sheikh Mohammed bin Rashid to form a higher committee to supervise Dubai’s future technological developments reflect the importance of facing the future with an open mind. The move will help us fully understand reality and explore unique ideas that will shape a brighter future for Dubai and the UAE, maximizing future business opportunities.”

According to reports, it is hoped that the metaverse will grow to account for $4 billion worth of Dubai’s revenue by 2030. 

Luxury watch manufacturer, TAG Heuer, begins accepting cryptocurrencies in the US

Following in the footsteps of other luxury brands such as Gucci and Hublot, Swiss watch manufacturer, TAG Heuer, has confirmed that it will begin accepting cryptocurrencies online in the US. 

According to a tweet released by the company on Thursday, US consumers can start to use 12 different cryptocurrencies to complete purchases of its famous watches.

Cryptocurrencies will initially include Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Dogecoin, Shiba Inu, and Wrapped Bitcoin. The company will also accept a range of US dollar-pegged stablecoins including USDP, BUSD, DAI, USDC, and GUSD. The acceptance of digital assets will be facilitated by the cryptocurrency payment provider, BitPay. 

In an accompanying press release, TAG Heuer outlined that the acceptance of crypto for payments will be piloted within the US before expansion worldwide.

The CEO of the brand, Fredric Arnault commented on the news, stating that, “we have been following cryptocurrency developments very closely ever since Bitcoin first started trading. As an avant-garde watchmaker with an innovative spirit, we knew TAG Heuer would adopt what promises to be a globally integrated technology in the near future despite the fluctuations – one that will deeply transform our industry and beyond.”

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Crypto prices are rebounding after last week’s chaos in the Terra ecosystem and the release of US Consumer Price Index (CPI) figures caused prices to rapidly plummet.

Although an improvement on March, the idea that peak inflation has passed was not a sentiment shared by markets worldwide, which continued to slip further. 

However, many investors were quick to snap up a bargain, with the price of Bitcoin increasing by 23% heading into the weekend. 

Elsewhere, Germany announced world-leading tax policies for digital assets holders and Musk continued to throw support behind Dogecoin’s future.

• Bitcoin falls to 2 year low amid CPI release
• Terra ecosystem chaos adds pressure to markets
• Musk pauses Twitter deal but continues to back DOGE as a form of currency
• Germany confirms tax-free crypto sales
• UAE-based Emirates airlines to embrace digital assets

Terra ecosystem chaos adds pressure to markets

The digital asset markets were severely shaken last week as chaos in the Terra blockchain ecosystem led to panic selling across crypto markets. Terra came under pressure when the native stablecoin, UST, began to lose its peg to the US dollar. Although attempts were made to defend the peg with recently purchased BTC holdings, UST continued to initially fall to a value of $0.63. 

As a result of the de-peg, the algorithmic component of the coins stability mechanism continued to mint native LUNA coins. According to the algorithm, for each UST removed from the market, the equivalent value of LUNA is minted. 

Unfortunately, over the following 3 days, the mechanism was not enough to re-peg UST, which meant that the market was flooded with new LUNA. As of today, UST is currently trading at $0.17, while LUNA has fallen to $0.00024.

Due to the chaos, the Terra blockchain was halted by validators on Thursday. Many exchanges also ceased the trading of the native assets. After coding patches, the blockchain was reinstated on Friday, however, UST and LUNA values continued to fall. 

With the collapse of UST and LUNA, some experts believe that $40 billion was lost during a 48-hour period. Due to the collapse of liquidity, years of work put into decentralized projects such as Lida and Anchor were also lost. 

The effects from the Terra ecosystem rippled throughout the industry and increased the bearish sentiment that was already being felt due to newly published CPI figures. 

Although revival plans were released on Friday by Terra’s founder, Do Kwon, the plans were met with mixed emotions and scepticism by most Terra community members.

Bitcoin falls to 2 year low amid higher than expected CPI figures 

Downward pressure on markets increased on Wednesday as higher than expected Consumer Price Index (CPI) figures were released to the public. 

The CPI, which is a basket of goods and services, is often used as a proxy for the rising cost of living expenses. Updated CPI figures showed that year-on-year inflation figures had increased to 8.3% in April 2022, which was 0.2% higher than many economists within the market were anticipating.

Most economists had estimated that CPI would be closer to 8.1% and highlighted the importance that any divergence could have on market sentiment. After publication, bearish price movements accelerated over much of Wednesday and Thursday.

In a report published by Deutsche Bank, analysts explained that “this will be a very important one for markets and the Fed, since although policymakers have strongly signalled that they’re inclined to continue hiking by 50bps at the next couple of meetings, there is still 25/50/75bps to play for after those meetings. Today’s report will help shape the early read into this, and has an ability to move markets in a large manner if diverging from consensus too far.”

The April CPI figures were not as low as hoped but, importantly, were still 0.2% less than March. This has left some economists predicting that the peak of inflation could now be behind us. 

Although markets initially reacted negatively, many cryptocurrencies managed to regain ground thanks to opportunistic investors happy to grab a bargain. After dropping to a low of $25,500, Bitcoin quickly rebounded to re-capture the $30,000 level before heading into the weekend.

Musk pauses Twitter deal but continues to back DOGE as a form of currency

On Friday, Tesla and SpaceX CEO, Elon Musk, announced the deal to buy Twitter for $44 billion had been placed on hold.

Musk had secured a deal to purchase the social media platform in early May and had already begun discussing ways that the application could be improved. 

However, according to a tweet published on Friday, the entrepreneur explained that “Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users.” In a subsequent reply, Musk then described that he was “still committed to acquisition.”

His tweet was linked to a Reuters story that was published on 3rd May stating Twitter had estimated that 5% of its users could be spam or fake accounts. As a result, many experts believe that Musk is now using the finding as leverage to broker a better deal or even walk away from the deal if necessary.

However, the problem of spam and bot accounts is an issue that Musk has openly stated is one that he would like to tackle. Only last week, the entrepreneur voiced support of Shark Tank TV star, Mark Cuban’s, suggestion that Dogecoin could be used as a method to deter spam accounts.

In a subsequent tweet exchange with Dogecoin co-creator, Billy Markus, Musk further supported claims that Dogecoin could be used as a currency this week. After Markus outlined the reason that he liked Dogecoin was because “it knows it’s stupid”, Musk replied that “it has potential as a currency.”

The comments from the Tesla and SpaceX CEO reconfirm his strong belief that Dogecoin should be one of the digital currencies of the future.

Germany confirms tax-free crypto sales

On Wednesday, the German Ministry of Finance confirmed that the sale of all cryptocurrency assets would be tax-free as long as the digital assets were held for longer than 1 year.

The new policy details were published in a 24-page letter detailing the income taxation of cryptocurrencies. The document had finally been drafted after consultation with the 16 federal states that compose the country and several stakeholders across Germany’s financial industry.

One stumbling block that had prevented quicker publication was whether lending or staking cryptocurrencies would result in an extension of the tax-free period to 10 years. This is a rule currently followed by buy-to-let property owners within Germany.

However, in a statement released by State Secretary Katja Hessel, “the deadline is not extended to 10 years if, for example, bitcoin was previously used for lending or the taxpayer provided ether as a stake for someone else to create their block.”

The news was warmly welcomed by the cryptocurrency community based within Germany and also by industry leaders around the world. 

In an interview with Blockworks, EU policy expert, Patrick Hansen said, “This is already a huge success and makes Germany a very attractive country crypto-tax-wise.” He then continued to explain that he considers Germany “definitely ahead of most other countries in the world in terms of crypto regulation, taxes, [anti-money laundering] rules, particularly its travel rule implementation, and the crypto business licensing.”

According to reports, Germany currently hosts 14% of all Ethereum nodes and also 9% of all Bitcoin nodes. 

UAE-based Emirates airline to embrace digital assets 

Emirates, one of the largest airlines in the world, confirmed last week that it was willing to embrace blockchain technology including cryptocurrencies, the metaverse, and NFTs. 

The company, which is headquartered in Dubai, covers vast areas of the world with its fleet. According to the Chief Operating Officer (COO), Adel Ahmed Al-Redha, the company plans to hire new employees to deal with this new technology and to advance the organization even further. 

In an interview conducted with Arab News, Al-Redha explained that “NFTs and metaverse are two different applications and approaches.” He then continued, “with the metaverse, you will be able to transform your whole processes — whether it is in operation, training, sales on the website, or complete experience — into a metaverse type application, but more importantly making it interactive.”

The executive also told reporters that the airline plans to introduce “bitcoin as a payment service”, however, the COO did not outline when these blockchain-related plans would be implemented.

The news comes 1 month after the airline released a report detailing the release of an NFT collection that will include experiences within the metaverse.

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Everyone and their mother knows what Bitcoin, the king of cryptocurrency, is and how it has redefined the future of finance. So what the heck is Bitcoin Cash?

Comparing Bitcoin Cash vs Bitcoin is only natural given these two cryptocurrencies share more than just the same name. They have a number of similarities as well as distinct features that make them quite different from each other. This can leave you wondering; is Bitcoin Cash a good investment and is it worth your time?

In this article, we take a look at these differences, why and how the currency was born, and how to buy Bitcoin Cash. Let’s get started.

Why was Bitcoin Cash created?

Since it was created, Bitcoin has had some transaction speed problems.

Compared with traditional payment models such as the Visa or MasterCard networks, which can handle tens of thousands of transactions per second, Bitcoin’s network can handle approximately seven.

Sending Bitcoin without using layer 2 solutions such as the Lightning Network, or paying high network fees, can take anywhere from 10 minutes to a week to move a Bitcoin from one wallet to another.

So that’s a problem. It’s frustrating enough to wait a few seconds while the credit card machine confirms your purchase.

This is where Bitcoin Cash comes in.

What is Bitcoin Cash (BCH)?

Created in 2017, Bitcoin Cash is a fork of Bitcoin. It is based on the same underlying technology as Bitcoin however it has a single major change; the block size is eight megabytes instead of Bitcoin’s meager one, allowing faster transactions to occur.

As a result, the blockchain of Bitcoin Cash has fewer, but larger, blocks making up its blockchain database.

Compared to Bitcoin, the Bitcoin Cash network handles about 60 transactions per second. It’s not quite Visa, but it’s a substantial step up.

Bitcoin vs Bitcoin Cash: what is BCH’s advantage over BTC?

For all intents and purposes, there’s really just one difference. Bitcoin Cash has a block size of eight megabytes while Bitcoin has one.

As a result, Bitcoin Cash has a less congested blockchain. With the larger blocks, nodes have to confirm fewer individual ledgers as part of any transaction.

This allows nodes to process transactions quicker, the result being that Bitcoin Cash processing fees cost a fraction of what nodes charge to handle Bitcoin transactions.  

Bitcoin vs Bitcoin Cash: what is BCH’s disadvantage over BTC?

Given the transaction speed is so much higher, it also means that Bitcoin Cash requires more processing power to handle the larger blocks.

This is one of the main criticisms of the cryptocurrency, as only big mining operations can afford the computing power necessary to process on this network. 

Some also fear that Bitcoin Cash is not as secure as the mighty Bitcoin, given that there is less mining capacity invested in securing the network.

Is Bitcoin Cash (BCH) a good investment?

Some speculators predict that the price for BCH might go up to $1000 by the end of 2022. Of course, no one can predict how a volatile asset such as Bitcoin Cash will react to market movements in the future.

However, when compared to Bitcoin, BCH has faster transaction and verification times as well as lower trading fees, making it a more viable option for peer-to-peer payments between individuals, like cash, but in digital form. 

The bottom line is that if you intend on spending your crypto soon and don’t want to use a Lightning wallet, BCH may be the better option. However if you’re planning to HODL for the long haul, BTC is probably the safer bet!

As always, keep in mind that before investing in any asset, you need to assess your risk tolerance, personal financial needs and investing goals. 

How to buy Bitcoin Cash (BCH)

At xcoins.com, you can buy BCH easily and securely in a few simple steps. Just register with xcoins.com, verify your identity and wait for us to review your profile within 15 minutes.

Then, place your order by selecting Bitcoin Cash from the dropdown menu, entering the amount you’d like to buy and choosing your payment method.

The final step is entering your Bitcoin Cash wallet address and pressing Complete Payment. You will then receive your Bitcoin cash coins in a few minutes.

Xcoins.com makes the payment process easy, offering payment by debit or credit card, via SEPA bank transfer for EU residents, as well as faster Payments bank transfer for selected countries.

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The cryptocurrency market has been experiencing a general downward trend in recent months. From April to May 2022, Bitcoin’s value dropped by 31%, while the price of Ethereum and Ripple fell by 37% and 48% respectively. This has alarmed some but left others wondering whether now is the time to buy the dip.

The collapse of Luna, the token that forms the basis for algorithmic stablecoin UST, has contributed to FUD that has spread across crypto markets in recent days. UST lost its peg to the US dollar at the beginning of May and its market value now stands at $7.7 billion, down from $18.4 billion before its decoupling. This has led to LUNA losing 95% of its value in just five days causing many traders to panic sell not just LUNA and UST, but other tokens that they worry could get caught in the crossfire.

At the time of writing, Bitcoin is trading at $27,724. A far cry from the heady days of late 2021 when Bitcoin reached an all-time high of nearly $68,000. This isn’t the first time we’ve seen a dramatic Bitcoin price drop, though, and despite the doubters, this could actually present the perfect investment opportunity.

Why is the crypto market down?

The fall in cryptocurrency prices over the past year is broadly believed to be the result of a range of macro factors that are impacting not just crypto, but weighing upon various global markets from tech stocks to commodities.

Rising inflation has led the US Federal Reserve to raise interest rates, and these inflationary controls often have a negative impact on cryptocurrencies like Bitcoin. As the cost of borrowing becomes more expensive, investors move away from ‘riskier’ assets and shift their portfolios to more conservative options, leading to the Bitcoin dip we’ve seen recently. 

Other contributing factors influencing the crypto dip include Russia’s war in Ukraine and China’s ban on crypto trading and mining. It’s thought that between 65% and 75% of the world’s bitcoin mining was done in China, and without this, it’s uncertain how worldwide Bitcoin production (and by extension its price) will be affected.

However, a recent announcement by the Federal Reserve chairman stating he wasn’t considering further rate hikes caused Bitcoin’s value to rise by 6%, demonstrating just how quickly Bitcoin can recover when the conditions are right.

Also, cryptocurrency ownership continues to grow, and many think mass adoption is inevitable, leading to more confidence in cryptocurrencies. Despite Bitcoin’s volatility, the price has risen steadily over the years, and some predict it will hit $100,000 by the end of the year. 

What does buy the dip mean?

Buying the dip means just that, buying when the price of an asset – such as a stock or a cryptocurrency – has dipped significantly. The idea is that you’re picking up a bargain, and when, or if, the price bounces back, you’ll make a profit. This buying low and selling high is the oldest of investment strategies, and to succeed, timing is key.

In the crypto market, investors will often keep a close eye on a particular cryptocurrency to see if it drops in value, buying when it does. Others will start investing small amounts once the fall hits a set threshold (say 20%) and continue investing each month until the price is up again.

Advantages of buying the dip

It’s not enough to buy a cryptocurrency just because it’s experiencing a dip. You also need to consider whether it’s a well-performing asset that will eventually rebound in price. Cryptocurrencies like Bitcoin and Ethereum have often outperformed expectations and, despite dramatic drops in price, have often later experienced huge rallies.

If you’re considering going down the buy the dip route, there are two main strategies available.

The first is HODLing, where you hold on to your crypto investment for the long term. Buying the dip is ideal for this kind of strategy – you buy in a bear market and then, ideally, sell later in a bull market for a decent profit. If an asset, like Bitcoin or Ripple, is trading below what many believe to be its intrinsic value, it’s a good time to buy and HODL.

The second is dollar-cost averaging, which is frequently used by stock market investors but also has applications in the crypto market. It involves investing a small amount into crypto at regular intervals. The idea is that you’ll be buying the dip at some point without having to worry about trying to time the market (something that’s hard to get right).

The current Bitcoin dip could be the moment for those investors who’ve been waiting for the right time to enter the market. Don’t rush into it though. Do your own analysis and research before deciding to buy and at what price.

The cryptocurrency market is volatile so no one can ever tell you when it’s the absolute right time to buy. However, if you’re buying when the market is low you’re increasing the chances that you’ll make a decent profit somewhere down the line, as long as you hold your nerve.

For a buy the dip strategy to be successful, patience and a cool head are key. Buying is only half the battle. You’ve got to know when to sell too in order to enjoy the biggest advantage of buying the dip – increased returns. 

Disadvantages of buying the dip

There are, of course, no guarantees when investing, whether it’s in cryptocurrency or the traditional stock market. If anyone tells you that you can make big profits for little to no risk, they’re probably just another Bernie Madoff. 

The biggest danger when buying the dip is that the cryptocurrency you’ve invested in doesn’t recover its price as expected, or that it takes so long to increase again that you end up stuck with your investment for fear of selling at a loss.

One particular mistake investors make is assuming that just because the price rose before, it will again. It’s also worth asking yourself if the crypto dip is actually justified. Not all cryptocurrencies are the same, and not all have the backing and investment that, say, Bitcoin and Ethereum enjoy.

Also, when there’s a crypto price drop it’s hard to know if that’s as low as it’s likely to go or if it’s going to drop much lower. This is where market knowledge comes in handy. Is the drop just a blip or are there fundamental reasons for the fall in value?

Because of the unpredictability of the cryptocurrency market, it’s difficult to know if and when the price will rise. Crypto investments can be risky and the best way to minimise that risk is to diversify your portfolio. As a general rule, many experts believe you should invest no more than 5% of your wealth into cryptocurrency, so keep this in mind if you do decide to buy the dip.

Is it time to buy the crypto dip?

Bitcoin and other cryptocurrencies have been through this boom-bust cycle before. Most recently in May 2021, when the crypto market lost $1 trillion of its value in one week before rebounding by the end of the year. It’s likely that the market will recover this time too, but the question is when, and also by how much? Even the experts don’t agree on the answers. 

With the crypto market down, there will inevitably be those who cut and run and those who see a golden opportunity. If you’re prepared to be in it for the long run, then a buy the dip strategy in 2022 could be a good investment option.

As always, this article does not constitute financial advice and you should be sure to do your own research and consult a professional financial advisor before making any investment decision.

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In a week where the Federal Reserve implemented an inflation-fighting interest rate hike, cryptocurrencies were shaken hard.

Although all risk-on markets suffered, there was plenty to celebrate as Bitcoin reached a major milestone in the halving cycle and a new all-time high hashrate.

The world-renowned podcast host Joe Rogan also shared his excitement over the cryptocurrency revolution.

Elsewhere, it was confirmed that Musk’s latest Twitter bid was supported by several crypto-friendly companies and a proposal was made for the integration of DOGE.

• Bitcoin blockchain acknowledges major halving milestone
• Joe Rogan compares Bitcoin to the early days of the internet and warns against CBDCs
• Elon Musk secures Twitter funding from pro-crypto companies
• Musk and Mark Cuban discuss Dogecoin proposal for Twitter
• Federal Reserve boosts interest rates by 0.5%

Bitcoin blockchain acknowledges major halving milestone

The Bitcoin network is now halfway to reaching the next halving cycle, which is estimated to occur on April 27, 2024. 

A 6.25 BTC block reward is currently distributed to miners that validate transactions and add the latest block to the blockchain. However, block rewards were once much higher, starting at 50 BTC per block when Bitcoin was first launched in 2009.

Halving cycles are preprogrammed into Bitcoin as a way to lower the inflation rate of the coin over time and, therefore, increase scarcity. At the point of each halving cycle, block rewards are halved. There have been 3 Bitcoin halving cycles so far.

A new halving cycle is programmed to occur every 210,000 blocks. According to Blockchain.com, Bitcoin reached the 105,000th block of the current halving cycle on Thursday. The milestone was achieved at a block height of 735,000. There are now less than 105,000 blocks remaining. 

In April 2024 or block height 840,000, halving rewards will drop to 3.125 per block. 

The halfway point in the cycle comes days after the Bitcoin hashrate reached a new all-time high of 260.32 exahash per second (EH/s). As a result of the peak in Bitcoin hashrate, experts expect that the Bitcoin mining difficulty will be increased during the next difficulty change. 

Joe Rogan compares Bitcoin to the early days of the internet and warns against CBDCs

One of the world’s most popular podcast hosts, Joe Rogan, who is listened to by millions of fans globally, provided his view on Bitcoin last week.

During an interview with Khalil Rountree, a UFC light heavyweight fighter, Rogan explained that he views Bitcoin the same way that the internet was viewed in the 1990s. 

Talking on the podcast, Rogan said “I think about bitcoin the same way I think about the early internet.” He then stated that he believed the government had not seen it coming. “Now it’s a viable form of currency. You can actually buy things with it. I think the government is freaking out.”

He then went on to compare the attempts at censoring the Internet to the upcoming rise of Central Bank Digital Currencies (CBDCs). Rogan explained that the Obama administration tried to censor the internet but that the thought of a CBDC was much worse.

“They are going to try to implement a digital currency — a centralized digital currency that they can control.”

Rogan outlined his fears that if CBDCs were adopted by the majority of the population it would hand over control of what the population could spend money on. 

Musk secures Twitter funding from pro-crypto companies

The CEO of both Tesla and SpaceX, Elon Musk, secured funding from 18 different companies for the purchase of the social media platform, Twitter.

According to Musk’s Security and Exchange Commission filing, 18 companies provided Musk with an additional $7.139 billion for his $44 billion takeover bid. Interestingly, there are several pro-cryptocurrency companies on the list of investors.

Pro-crypto companies include Sequoia Capital Fund, which invested $800 million, the Binance cryptocurrency exchange, which invested $500 million, AH Capital Management, which invested $400 million, and Fidelity Investments, which invested $300 million. 

Sequoia Capital Fund and AH Capital Management are both venture capital firms that are known to have collaborated and partnered with several crypto-focused organizations in the past, including FTX and Twitter. Meanwhile, Fidelity Investments has been bullish on cryptocurrencies for some time, recently launching two new crypto-focused ETFs. 

Binance’s CEO, Changpeng Zhao published a tweet on Thursday outlining the company’s happiness in helping Musk with the Twitter bid. Zhao explained, “we’re excited to be able to help Elon realize a new vision for Twitter … We hope to be able to play a role in bringing social media and web3 together and broadening the use and adoption of crypto and blockchain technology.”

The largest investor in Musk’s takeover bid of Twitter came from the co-founder of Oracle Corp, Larry Ellison, who is also a member of the Tesla board. Ellison invested $1 billion into the bid.

Musk and Mark Cuban discuss Dogecoin proposal for Twitter

During the same week as Musk’s Twitter investors were uncovered, the billionaire and Shark Tank TV star, Mark Cuban, proposed a new tactic for dealing with spam on the social media platform. 

Cuban suggested using Dogecoin to stop the thousands of bot-like characters that plague users. The Shark Tank star said in a tweet, “everyone puts up 1 doge for unlimited posts. If anyone contests a post and humans confirm it’s spam, they get the spammer’s Doge.”

The idea was supported by both Dogecoin co-founder Billy Markus who retweeted the post saying “I like this” and also by Musk who replied, “Not a bad idea.”

The news was also met with enthusiasm from Dogecoin supporters with the potential integration of a platform such as Twitter being extremely bullish for the DOGE cryptocurrency. 

However, some members of the cryptocurrency community were quick to comment on the holes in Cuban’s plan. Some argued that there would still be ways to game the system such as highlighting any post just to try to claim a user’s DOGE. Many also argued that it would deter use of what is currently a free-to-use service.

Federal Reserve increase interest rates by 0.5%

The US Central Bank raised interest rates by 0.5% on Thursday, which is the largest single interest rate hike in the last 20 years.

Although the Federal Reserve implemented a 0.25% increase in March, as a result of climbing inflation levels, the Federal Reserve decided to approve a second interest rate increase taking the US Central Bank interest rate to between 0.75% and 1%. Increasing interest rates is seen as a combative measure against rising inflation levels.

The Federal Reserve had lowered interest rates to 0% during the aftermath of Covid-19 and also pumped money into the economy through bond purchases and stimulus cheques. Macro economists believe these are the reasons for the rising cost of inflation facing the world currently.

Many experts had predicted a sharper increase, however, the Fed remained cautious, approving only a 50 basis point hike. Due to the cautious approach both stocks and cryptocurrency markets initially rallied, but turned lower during the following Thursday and Friday trading sessions. In the short term, rising interest rates are often interpreted to be damaging for risk-on assets such as stocks and cryptos, as large scale investors sell assets to cover debt positions. 

However, long term, Bitcoin is seen as a hedge against rising inflation due to it’s scarcity in comparison to the US dollar.

The outcome of rising interest rates will be reviewed this week as US Consumer Price Index (CPI) figures are released on Wednesday. CPI figures are typically used as a proxy to the ongoing state of inflation within the country. The figures will provide the first indication of whether the increasing interest rates have had any impact on the US economy.

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With the long-awaited Bitcoin halving event now safely in the rearview mirror, investors everywhere are asking the same question, will history repeat itself yet again?

As the fourth Bitcoin halving occurred on April 17, 2024, the price of Bitcoin stood at $64,100.

The halving events, crucial to Bitcoin’s economic model, reduce the reward for mining new blocks by half, diminishing the rate at which new bitcoins are generated and enter circulation. 

This process is inherently deflationary and aims to mimic the extraction of a finite resource, akin to gold mining.

Bitcoin has Surged in the 12 Months Following Every Halving to Date

Bitcoin’s price performance has consistently shown impressive growth in the year following each of its halving events. 

The first halving in 2012 led to an extraordinary surge in Bitcoin’s value, with a 7,645% increase in the 365 days that followed. 

The second halving in 2016 also resulted in significant gains, with a 292% increase in the same period. 

The third halving in 2020 continued this trend, albeit at a slightly lower magnitude, with a 266% rise in Bitcoin’s price over the subsequent year. 

These patterns highlight the significant impact of halving events on reducing the supply of Bitcoin and increasing its price, driven by heightened demand amid reduced new supply entering the market.

What Was The Bitcoin Price at Each Halving?

To better understand the potential future trajectory of Bitcoin’s price, it’s insightful to look at the historical impact of previous halving events:

• First Halving (2012): Occurred on November 28, 2012, with Bitcoin priced at $12.50. Following this event, Bitcoin saw a significant increase in value, peaking at over $1,000 in 2013.
• Second Halving (2016): Happened on July 9, 2016, when Bitcoin was trading at $638.51. The year following the halving witnessed a remarkable bull run, culminating in a price of nearly $20,000 at the end of 2017.
• Third Halving (2020): Took place on May 11, 2020, with the price at $8,475. Subsequent to this halving, Bitcoin again experienced substantial growth, eventually reaching an all-time high above $64,000 in April 2021 before seeins a significant pull back.
• Fourth Halving (2024): Took place on April 20, 2024, with the price at $64,100. Analysts have high expectations for the coming cycle as it is the first cycle after the advent of Bitcoin ETFs and the first cycle after Bitcoin has reached a fresh all-time high in the run up to a halving event, two facts that are certainly no mere coincidence.

Post-Halving Analysis

The fourth halving has set the stage for another fascinating chapter in Bitcoin’s history. Given the historical precedence of price increases in the post-halving window, due to the reduced supply of new bitcoins against a backdrop of steady or increasing demand, a bullish outlook seems well justified. 

But this time is different. How so?

Get Ready for the ETF Effect

The degree of adoption by both retail and institutional investors plays a critical role in the demand side of Bitcoin’s valuation. Positive sentiment and increased adoption can lead to higher prices, while regulatory crackdowns or macroeconomic downturns might have the opposite effect.

The introduction of new Bitcoin ETFs (Exchange-Traded Funds) could significantly magnify Bitcoin’s price growth this cycle by providing an accessible and regulated avenue for institutional and retail investors to gain exposure to Bitcoin for the first time ever without directly purchasing the cryptocurrency. 

These ETFs function by holding actual Bitcoin, thus increasing demand and reducing the available supply in the market. Increased accessibility through ETFs typically attracts more significant investments from sectors of the market previously hesitant about direct cryptocurrency engagements due to security concerns or regulatory compliance issues.

Additionally, ETFs can lead to higher liquidity and potentially more stable prices in the long-term, albeit with amplified price movements due to larger capital inflows and outflows. This broadened investor base, coupled with the ease of trading and heightened visibility, might further drive Bitcoin’s price upward in a vicious cycle as more investors catch a case of FOMO and seek to include digital assets in their portfolios.

The Lightning Network is Gaining Ground

Innovations within the Bitcoin network, such as improvements in scalability and security, primarily, the rapidly evolving adoption of the Lightning Network, could enhance its utility and appeal, potentially driving up price.

The Lightning Network, a layer-2 payment protocol built on top of the Bitcoin blockchain, represents a pivotal advancement in scaling Bitcoin transactions. By enabling faster and cheaper transactions, the Lightning Network can significantly broaden Bitcoin’s utility in everyday transactions, potentially opening up new markets. For example, it could revolutionize microtransactions, which are impractical on the main blockchain due to high fees and slower confirmation times. 

This makes it viable for a variety of small-scale transactions such as paying for coffee, digital content, or even tips on social media, thereby expanding Bitcoin’s use in everyday commerce. Additionally, the Lightning Network enhances Bitcoin’s suitability for remittance payments, providing a quicker, cheaper alternative to traditional money transfer services, especially in regions with underdeveloped financial infrastructure. This could increase Bitcoin’s adoption in countries with high remittance flows, integrating larger segments of the global population into the digital economy.

What Price Will Bitcoin be in 2025?

The million-dollar question, but is a million dollars far off? Considering the factors above and historical trends following halving events, we can expect Bitcoin’s price one year from now might well fall in a range between $100,000 and $500,000. This forecast accounts for growing adoption, and the historical price patterns post-halving.

As of April 2024, several leading analysts have projected a range of potential prices for Bitcoin, reflecting both optimism and market realism. Here’s a summary of some of the latest Bitcoin price predictions:

1. Standard Chartered predicts a possible high of $250,000 for Bitcoin by 2025, influenced by strong inflows into spot BTC ETFs, which they expect to continue boosting the price​ (99 Bitcoins)​.
2. Aurelien Ohayon from Xorstrategy is highly optimistic, suggesting Bitcoin could surge to $500,000 by late 2025, driven by factors including the approval of spot BTC ETFs in the US and the effects of the 2024 halving​ (BeInCrypto)​.
3. A panel of 50 experts suggests a slightly more conservative average price of $249,578 by 2025, citing continued growth in institutional demand and the broadening use of Bitcoin as a store of value​ (CoinMarketCap)​.
4. Finbold interviewed finance experts who project an average price of $87,000 by 2025 driven by wider institutional adoption(Finbold)​.

It is also crucial to acknowledge the inherent volatility and unpredictability of Bitcoin. External shocks, whether economic, technological, or regulatory, could drastically alter the trajectory predicted by historical trends and as with all investments, past performance does not guarantee future results.

The Outlook Has Rarely Looked So Bullish

While the future price of Bitcoin is uncertain, the historically repeated impact of halving events combined with the recent advent of ETFs provides a strong foundation for speculative optimism. 

Potential investors should perform their due diligence and consider a variety of scenarios and risks when contemplating their investment decisions in Bitcoin, and always remember the value of self-custody.

Whether Bitcoin reaches the heights of these predictions, remains stable, or even experiences a decrease, it appears well set to remain at the forefront of financial technology innovation.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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At a block height of 840,000, Bitcoin celebrated its fourth halving event this weekend, marking one of the industry’s greatest-ever milestones.

Bitcoin’s scarcity surpasses that of gold following the halving, signaling a paradigm shift in the digital asset’s store of value proposition. 

In a notable technological advancement, the unveiling of Runes introduced fungible tokens to the Bitcoin blockchain and, finally, investor sentiment received a last-minute boost as Bitcoin ETF inflows turned net positive on Friday.

As Bitcoin enthusiasts worldwide revel in the aftermath of the much-anticipated fourth halving, it’s time to dive in.

Bitcoin’s fourth halving is celebrated

On Saturday, Bitcoin marked one of its most important milestones with the completion of its fourth halving event.

This is an event that has been hotly anticipated by the cryptocurrency community which is reflected by all-time highs in Google Search results for the term ‘Bitcoin halving’. 

With the creation of its 840,000th block, the world’s leading blockchain has once again halved its mining rewards, reducing them from 6.25 BTC per mined block to 3.125 BTC.

Although many expected either an instant price pump or price dump, the halving has been met with a moderate price increase with Bitcoin trading at $65,000 at the time of writing.

The halving is a process that is baked into Bitcoin’s underlying code and occurs approximately every four years or after every 210,000 blocks mined. 

This mechanism, integrated into the code by Bitcoin’s founder, Satoshi Nakamoto, was added so that BTC’s inflationary supply could be regulated.

By halving mining rewards, Bitcoin’s protocol effectively slows down the rate at which new coins are introduced into circulation, ultimately contributing to its deflationary nature.

The latest halving event is the fourth in the sequence with previous halvings occurring in 2012, 2016, and 2020. Each resulted in a significant reduction in mining rewards over time. 

Looking ahead into the future, halving cycles are expected to continue until roughly 2140, by which time all 21 million bitcoins will have been mined, cementing Bitcoin’s status as a finite asset.

As a result of the decrease in mining rewards, leading Bitcoin miners have been making strategic moves in anticipation of the event. 

While short-term price volatility may ensue, there remains widespread optimism regarding Bitcoin’s long-term potential. 

In particular, Billionaire investor, Tim Draper, spoke with CoinTelegraph during the week and outlined his continued bullish stance.

Draper foresees Bitcoin’s price surging to “$250,000 or more” in the wake of the halving, citing the reduction in supply and sustained demand as key drivers of upward price movement.

However, there are some in the community, such as Herbert Sim, also known as “Bitcoin Man,” who caution against placing undue emphasis solely on the halving event when analyzing Bitcoin’s price dynamics. 

He suggests that factors such as the recent approval of a Bitcoin ETF in Hong Kong and potential institutional adoption in China could also exert significant influence on price movements.

Bitcoin becomes more scarce than gold

According to Ecoinometrics, the onset of Bitcoin’s latest halving has now resulted in its scarcity outpacing that of gold. 

While the stock-to-flow model popularized by PlanB may have lost some of its spotlight since 2020, it can still be used to compare it against one of the world’s most precious metals.

The stock-to-flow ratio compares the amount of Bitcoin in circulation to the new Bitcoins generated through mining annually.

Although not as accurate, the same model is often applied to gold by using the amount of gold in circulation against the best estimates for the amount mined annually. 

Throughout history, gold has been the benchmark for scarcity, boasting an average stock-to-flow ratio of approximately 66 over the last 100 years, with variations between 45 and 85 depending on the year.

During Bitcoin’s third halving event in 2020, its stock-to-flow ratio dropped to 56, which was just below that of the precious metal.

However, after Bitcoin’s fourth halving on the weekend, the ratio is poised to double, catapulting Bitcoin into a realm of unprecedented scarcity.

According to Ecoinometrics best estimates, the stock-to-flow ratio for the world’s leading cryptocurrency could jump to 120 and this would mean BTC becomes twice as scarce as gold.

New technology brings fungible tokens to Bitcoin

Coupled with Bitcoin’s halving, a brand new technology has been unveiled that allows for the creation of fungible tokens on the Bitcoin blockchain.

The highly anticipated release on Runes, spearheaded by renowned Bitcoin architect Casey Rodamor, marks a significant milestone in blockchain innovation. 

Whereas other blockchains like Ethereum and Solana offer smart contracts and, therefore, enhanced functionality, for the majority of its existence the Bitcoin blockchain has been viewed as a payment protocol. 

It can transfer wealth from one person to another but nothing more.

However, new protocols such as Ordinals and the BRC-20 token standard have changed the game over the last 12 months.

Ordinals revolutionized the concept of inscribing unique data onto individual satoshis, the smallest denomination of Bitcoin, and BRC-20 was one of the first token standards that allowed fungible tokens to be traded on the Bitcoin blockchain.

However, Runes aims to take fungible token creation on Bitcoin one step further.

Proposed by Casey Rodamor, Runes offers a new way for developers to mint tokens with fungible properties, akin to the likes of DOGE and SHIBA that we have witnessed rise to fame on other blockchains.

Unlike BRC-20’s, Runes stores messages in the output of a Bitcoin transaction which helps to improve efficiency due to the low on-chain footprint and it has already captured vast attention from the Bitcoin ecosystem.

Although set to debut on the date of the Bitcoin halving, a plethora of Runes projects had already begun their journey, including notable contenders such as DOG•DOG•DOG•DOG•DOG, MEME•ECONOMICS, SHORT•THE•WORLD, and PEPE•WIT•HONKERS.

Much like Ordinals in 2023, the unveiling of Runes has ignited a frenzy of activity, propelling transaction fees to unprecedented heights as users rush to partake in the creation of new tokens – but remember, you still pay low fees when you buy at Xcoins thanks to batching!

Bitcoin ETF inflows turn net positive over halving excitement

As anticipation surrounding Bitcoin’s halving built on Friday, the US-based Bitcoin Spot ETF market witnessed a notable shift as net inflows turned positive.

The reversal, which was warmly welcomed by crypto investors, came after a continuous five-day drain that started on April 12th.

Data released by Farside indicates that between April 12 and 18, the US Bitcoin ETF ecosystem experienced outflows totaling $319 million.

Grayscale’s GBTC played a significant role in these outflows, shedding over $623 million worth of BTC since April 12th. 

However, the narrative shifted on Friday, with five out of the 10 approved ETFs recording positive inflows that overshadowed outflows from GBTC. 

The influx totaled $59.7 million and injected fresh capital into the market.

Offsetting the cumulative outflows of $45.8 million from GBTC, Fidelity’s FBTC ETF attracted $54.8 million on Friday just before the commencement of the Bitcoin halving event. 

Other notable contributors to the inflows included Bitwise’s BITB with $4.9 million, ARK 21Shares’s ARKB with $12.5 million, Invesco Galaxy with $3.9 million, and Franklin with $1.9 million.

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Bitcoin has just experienced a significant pullback, dropping over 15% from its all-time high just a month ago. This decline has sparked widespread discussion among investors and enthusiasts alike, leading many to ask, “why is Bitcoin down?” and “how long will the Bitcoin dip last?”

Understanding these market movements is crucial for identifying investment opportunities, especially with the upcoming Bitcoin halving event this Friday, now just two days away!

Why is Bitcoin dropping?

Although there has been a slowdown in the pace of the cryptocurrency markets over recent weeks, macro developments served as the impetus for last Friday’s fall. Commodity markets became uneasy due to growing concerns of a military confrontation between Israel and Iran. 

Bond rates and the value of the US currency also increased significantly as investors discounted rate cut expectations against positive U.S. economic data and growing worries about persistent inflation.

This recent downturn is tied with broader economic uncertainties, including fluctuating stock markets and geopolitical tensions, which have also played a role in influencing Bitcoin’s price.

The Silver Lining: The Final Buying Opportunity Before the Halving

The good news is that a 15% pullback, while substantial, aligns perfectly with the typical “pre-halving dips” observed before previous halvings, and these have been historically followed by major bull markets.

These dips have often served as the best buying opportunities before the onset of major bull markets driven by the reduced supply of Bitcoin following the halving. 

Given the broader economic context, including geopolitical tensions and shifts in the U.S. bond and currency markets, the dip not only reflects short-term market fears but also sets the stage for potential long-term gains. 

For those looking to invest in Bitcoin, this moment could represent a strategic entry point right before the halving is anticipated to trigger a new rally in the cryptocurrency market.

What is the Bitcoin Halving?

The Bitcoin halving is a scheduled event that occurs approximately every four years, where the reward for mining new blocks is halved, effectively reducing the supply of new Bitcoins entering the market. This event has historically been a precursor to significant price increases due to the reduced supply growth.

Why the Dip May Be a Huge Opportunity

For savvy investors, the current dip could present a unique buying opportunity. Past halvings have typically been followed by substantial rallies in Bitcoin’s price, as the reduced supply of new coins helps drive up demand. 

With the next halving set for 19 April 2024, the current lower prices could offer a strategic entry point before we see the first halving in history after Bitcoin ETFs opened up the market to a massive wave of potential new ETF investors. 

For an indication of how this halving could play out differently this time, we just have to look at the “Gold Fractal”.  The Gold Fractal refers to the price trajectory of gold following the launch of its first ETFs in 2004, which preceded massive appreciation due to increased accessibility and investment flows. 

This historical precedent serves as a key reference point for analyzing Bitcoin’s potential growth trajectory in this first halving cycle post-ETF.

Impending Supply Squeeze: Bitcoin Balances on Exchanges Hit New Lows Ahead of Halving

Despite the recent volatility, the sentiment among long-term investors remains extremely bullish. The fundamentals of Bitcoin, combined with growing institutional interest and the increasing integration of Bitcoin into mainstream finance in the form of ETFs, suggest a bright future. Furthermore, the reduction in market leverage and resulting healthier market conditions post-correction suggest that Bitcoin is poised for recovery.

This is reflected in the Bitcoin balance on exchanges that has been steadily decreasing since January even in the face of recent volatility. This trend indicates a coming supply squeeze, as less Bitcoin is available for trading. 

Currently, with under 1.75 million Bitcoin remaining on exchanges, the scenario of a supply squeeze appears increasingly likely. This diminishing availability of Bitcoin is extremely bullish as we head into the Bitcoin halving event that will cut the new supply of Bitcoin in half. 

The intersection of reduced balances on exchanges and the upcoming halving could lead to a supply shortage much sooner than many market participants anticipate. Such a scenario would likely exert massive upward pressure on Bitcoin prices, making this a critical moment for investors to watch closely.

Key Takeaways for Investors

Investors considering Bitcoin should look beyond the immediate price fluctuations and consider the broader implications of the upcoming halving and its historical impact on the market in combination with the impact of the Bitcoin ETF on the anticipated price trajectory, in combination with the anticipated supply squeeze resulting from falling balances on exchanges. 

While the timing of market recovery is uncertain, the long-term prospects for Bitcoin remain strong, making this dip a potentially advantageous buying moment.

While the recent price drop may seem daunting, it opens up opportunities for those looking to invest in Bitcoin before the halving triggers another potential price surge. Savvy investors will watch these developments closely, and make their move.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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Gold has surged to unprecedented highs while risk assets face challenges, causing unease and unanswered questions in the global markets.

Meanwhile, Hong Kong is poised to approve spot Bitcoin and Ether ETFs, following the US trend. 

Elsewhere, Bitcoin’s dominance in the crypto market hit a three-year high impacting altcoins amidst heightened volatility, and an unexpected inflation surge has cast doubt on the Federal Reserve’s rate strategy, prompting a shift in market sentiment.

With volatility increasing in the markets, it’s an important time to keep our finger on the pulse.

Gold continues record surge while Bitcoin retraces as risk-on assets suffer

The price of gold soared to new all-time highs this week, while Bitcoin failed to mirror its momentum, causing unease in the crypto markets. 

As the week drew to a close, Bitcoin’s price struggled to rally, hovering around $69,000, before falling to a weekly low of $61,000 during weekend trading.

In comparison, gold emerged as the star performer of the last 7 days, reaching an unprecedented high of $2,431 per ounce on Friday.

This marks a 30% increase over the last 6 months, which is one of the best 6-month performances in the precious metal’s history.

However, the remarkable rally in gold prices has started to raise eyebrows among market participants, with some questioning the unusual behavior in the face of a favorable macroeconomic landscape.

In particular, analysts from The Kobeissi Letter, pointed to historical indicators such as a high US dollar and the appetite for risk-on assets soaring.

While central bank acquisitions and escalating geopolitical tensions in the Middle East could be supporting higher gold prices, the surge in prices has still left many asking the question, “Does someone know something?”  

The rise of gold is often seen as a positive indicator for Bitcoin, which is increasingly seen as digital gold, performing many of the key functions of gold to a higher standard.

Hong Kong to follow the US and approve Bitcoin Spot ETFs?

According to Bloomberg, Hong Kong is on the verge of greenlighting spot Bitcoin and Ether exchange-traded funds, mirroring the trend we have already witnessed in the United States. 

Sources close to the matter suggest that regulatory approval could come as early as today, potentially paving the way for trading by the end of the April.

While the approval timeline remains flexible and subject to potential last-minute alterations, anticipation is high within the cryptocurrency sphere. 

Harvest Global Investments, a prominent asset-management firm based in China, purportedly leads the charge, having spearheaded the application process for a spot bitcoin ETF. 

Additionally, a collaborative effort between Bosera Asset Management (International) Co. and HashKey Capital is also vying for approval, positioning themselves as frontrunners in the emerging ETF landscape.

Should all listing particulars be swiftly negotiated with the Hong Kong Exchanges & Clearing (HKEX), investors could witness the debut of these innovative financial products within weeks. 

In contrast to the United States, where spot bitcoin ETFs were sanctioned earlier this year, Hong Kong’s prospective approval includes both Bitcoin and Ether ETFs. 

The impending approval of these ETFs has piqued investor interest because alongside a regulatory formality; it represents a potential catalyst for substantial market movements. 

Expectations are running high for a surge in market activity akin to the record-breaking rally witnessed following the approval of spot Bitcoin ETFs in the United States earlier this year.

Bitcoin dominance surges to 3-year high amidst altcoin pressure

Bitcoin has asserted its dominance in the cryptocurrency market, reaching a milestone not seen in three years. 

The surge in Bitcoin’s dominance comes amidst a period of heightened volatility, with altcoins experiencing substantial downward pressure.

According to data from TradingView, Bitcoin’s dominance in the total crypto market cap soared to 56.3% on April 12. 

While Bitcoin faced its own challenges, with price fluctuations pushing BTC below $62,000, the impact on altcoins was even more severe. 

Many of the top twenty cryptocurrencies witnessed declines exceeding 15% on Friday, exacerbating the shift in market share towards Bitcoin.

Popular trader and social media commentator Bagsy remarked on the impressive nature of Bitcoin’s dominance chart, particularly considering the continuous influx of new altcoins into the market.

Despite the current dominance of Bitcoin, some analysts remain optimistic about the prospects for altcoins. 

Historically, Bitcoin bull markets have been followed by periods of increased dominance, often paving the way for altcoin rallies during extended periods of Bitcoin consolidation.

Drawing parallels with previous altcoin seasons, some analysts, such as @MikyBullCrypto, believe that the current market dynamics could be a precursor to a significant uptrend in altcoin dominance, coupled with a decline in Bitcoin’s dominance.

US CPI surges casting doubt on Fed’s rate strategy

An unexpected surge in inflation, as indicated by the CPI print, has fueled uncertainty among investors regarding the Federal Reserve’s future course of action on interest rates.

Market sentiment swiftly shifted as the March CPI data surpassed expectations, reporting a 0.4% month-on-month increase and a 3.5% year-over-year rise, exceeding estimates provided by Dow Jones economists. 

The core CPI, which excludes volatile food and energy prices, climbed 0.4% from February, signaling a broader inflationary trend with a 3.8% year-over-year increase.

A notable surge in the housing and gasoline sectors contributed to over half of the overall increase in the CPI index for March, as outlined in the official press release from the U.S. Bureau of Labor Statistics.

The release of the CPI data sparked immediate speculation within market circles regarding the Federal Reserve’s stance on interest rates in the upcoming months. 

Traders swiftly adjusted their expectations, with odds of a June rate cut plummeting to 20.6% according to the CME’s FedWatch tool, down from a previous estimation of 60%.

Analysts now predict that the Fed will likely maintain interest rates at their current levels throughout May and June, with the possibility of the first rate cut being pushed back to September. 

This shift in market sentiment marks a significant departure from historical trends, with interest rate futures now pricing in just two rate cuts for the entirety of 2024, contrasting sharply with previous guidance from the Federal Reserve.

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As we approach the final week before the much-anticipated Bitcoin halving event, scheduled just 8 days from now, speculation and anticipation is growing. 

Amidst this backdrop, U.S. inflation rates have made headlines today, rising unexpectedly to 3.5% prompting an immediate pullback in Bitcoin prices with sharper falls of altcoins. 

This development, coupled with the upcoming Bitcoin halving, presents a unique scenario for both seasoned investors and newcomers looking to buy Bitcoin at the opportune moment.

Understanding the Implications of the Recent CPI Print

The Consumer Price Index (CPI) data released today has taken many by surprise, climbing to 3.5% year-on-year. 

This is a significant indicator of economic turbulence. For the past few months, the expectation has been set around a 3.4% inflation rate. However, this slight uptick to 3.5% sends a clear message: buckle up, we are in for a more bumpy ride than expected.

The CPI and Core CPI data are critical metrics closely watched by market analysts and investors. They serve as a barometer for inflation, providing insights into economic health and consumer purchasing power. 

With the CPI overshooting expectations for the fourth consecutive time, concerns are mounting over the Federal Reserve’s interest rate policies. 

Initially, there was optimism that the Fed would cut interest rates multiple times in 2024, fuelling an already heated halving and ETF-fuelled crypto bull run. 

However, the persistence of higher-than-expected inflation rates is tempering these expectations, at least in the immediate short-term.

How Low Could Bitcoin Go Before The Halving?

Interestingly, the market had already braced itself for the impact of the CPI data, with significant de-risking observed in anticipation of the release. This preemptive move indicates that investors were gearing up for volatility. 

Yet, here lies the silver lining: should the inflation data have been neutral or even slightly positive, it could have acted as a catalyst for another sharp pre-halving market rally, that rally is likely now going to have to wait a bit longer. 

Unfortunately, the reality of a higher inflation rate has now set a different tone for the immediate future, leading to expectations of history continuing to repeat itself almost perfectly with a pre-halving double dip. 

As the saying goes, history doesn’t repeat itself, but it often rhymes!

The Bitcoin Halving Horizon: A Gold Lining?

With the Bitcoin halving event now barely a week away, and the power of Bitcoin ETFs to fuel Bitcoin prices already having passed its test run with flying colors in the format of the first-ever Bitcoin all-time high in the run up to a halving, the potential for a major market shift is palpable. 

Historically, Bitcoin halvings have been precursors to significant price rallies. The halving event, which reduces the reward for mining new blocks by half, effectively limits the new supply of Bitcoin, doubling scarcity. This scarcity has traditionally led to an exponential increase in Bitcoin’s price, as demand outpaces the slowing supply.

The Opportunity for Investors

Given the current economic landscape and the impending halving, there is a speculative opportunity that this might be the last significant dip before Bitcoin’s value ascends. 

For investors looking to buy Bitcoin, this scenario presents a potentially lucrative window. The juxtaposition of heightened U.S. inflation with the approaching halving creates a unique investment thesis: buying Bitcoin now, before the halving, could position investors favorably for the anticipated post-halving price surge.

Why Buy Bitcoin Now?

As we digest the potential impacts of the U.S. inflation rise and the approaching Bitcoin halving, let’s not forget the big-picture reasons why now might be an opportune moment to buy Bitcoin:

• Historical Precedence: Past halvings have consistently led to substantial increases in Bitcoin’s price, as the reduced supply meets or exceeds existing demand.
• Inflation Hedge: With U.S. inflation rising more than expected, Bitcoin continues to be viewed by many as a hedge against inflation, preserving value in ways that traditional fiat currencies may not.
• Market Dynamics: The market’s de-risking in anticipation of the CPI data release apparent from the sharp drop in prices in the 24 hours prior to the announcement might have already largely accounted for the negative impacts, potentially setting the stage for a quick rebound.
• Technological and Adoption Milestones: Beyond short-term market dynamics and economic indicators, Bitcoin’s growing acceptance and integration into mainstream finance bolsters its long-term value proposition.

Seizing the Moment

The confluence of rising U.S. inflation and the impending Bitcoin halving presents a nuanced but potentially incredibly rewarding opportunity for investors. 

As we navigate through these turbulent economic waters, the foresight to buy Bitcoin in this window could be a highly strategic move, leveraging the anticipated dip and the expected scarcity post-halving to capitalize on future price increases. 

As always, investors should conduct their own research, consider their financial situation, and possibly consult with a financial advisor before making investment decisions. 

With the clock ticking down to the halving, the question of today remains clear: Is this the last pre-halving dip, and are you ready to seize the moment?

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As we edge closer to the anticipated Bitcoin halving now just ten days away, a significant shift in the crypto trading landscape is underway, driven by the combined forces of the halving event and escalating ETF demand. That’s according to a new Gladdnode analysis.

This confluence demands a strategic pivot from traders, urging them to reconsider traditional trading approaches rather than relying on tactics that rely on Bitcoin’s historical cycles.

Historically, Bitcoin halvings have been seen as catalysts for bullish market movements, due to the reduced pace at which new bitcoins enter circulation. However, the current landscape introduces a twist: the robust buying activity of ETFs is poised to overshadow the traditional halving-induced supply squeeze. 

The significant uptake of Bitcoin by ETFs suggests a new paradigm where the effects of the halving on supply and demand dynamics may be pre-empted by institutional buying patterns.

Adapting to the New Normal: ETFs and the Bitcoin Supply Chain

In the run-up to the halving, it’s crucial for traders to weigh the historical significance of the event against the contemporary influence of ETFs. With ETFs now playing a pivotal role in Bitcoin’s supply mechanics, the impending halving presents an unprecedented scenario. Despite a reduction in miner rewards post-halving, the aggressive accumulation of Bitcoin by ETFs significantly modifies the expected market reaction, hinting at a dampened supply squeeze effect.

Understanding the magnitude of ETF acquisitions in relation to daily mined Bitcoin is key. Currently, ETFs are absorbing Bitcoin at a rate that far exceeds new miner output, fundamentally altering the supply-demand equation. This shift suggests that the forthcoming halving may not catalyze a traditional bullish surge as seen in past cycles. Instead, the market might experience a new equilibrium, shaped by institutional investment flows.

Long-Term Holder Dynamics and Market Sentiment

The role of Long-Term Holders (LTHs) in shaping market trends gains prominence against this backdrop. LTH behavior, characterized by their holding or selling patterns, offers critical insights into market sentiment and liquidity. As the market approaches the halving, understanding the interplay between LTH actions and ETF buying pressure becomes indispensable for anticipating directional moves in Bitcoin’s price.

Monitoring the Long-Term Holder Market Inflation Rate is crucial for traders looking to navigate these waters. This metric sheds light on the accumulation or distribution trends among LTHs, providing a gauge for potential market shifts. As we delve into a market cycle where ETF demand intersects a halving events for the first time, the insights derived from LTH behavior will be pivotal in crafting responsive and informed trading strategies.

Insights for the Forward-Thinking Trader

The upcoming Bitcoin halving, coupled with unprecedented ETF demand, heralds a new era in crypto trading where the hodler is king. 

This duality introduces complexities yet unseen, demanding a nuanced understanding of market forces and a flexible approach to trading strategy formulation.

In this evolving landscape, traders are advised to remain vigilant, closely monitoring ETF activities and the sentiment among Long-Term Holders. The interplay between these elements will likely dictate market dynamics in the post-halving period, making it essential for active traders to adapt their strategies to stay ahead.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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Update your calendars! The anticipated Bitcoin halving event, previously forecasted for April 28, is now projected to occur nearly a week earlier, on April 20 – just 15 days away!

This shift can be attributed to the recent upswing in Bitcoin’s value, which has attracted more mining activity accelerating the overall network speed.

The Surge in Mining Activity

The Bitcoin blockchain is experiencing a notable increase in computational power due to mining companies capitalizing on the current bullish market trends, sending Bitcoin’s hash rate to new all-time highs, hastening the arrival of new blocks.

This rush to benefit from rising prices has led to the deployment of new, more efficient mining rigs, alongside the reactivation of older equipment. Consequently, the network’s hash rate—a measure of its computational power—has seen significant growth.

Historically, this isn’t the first occurrence of such dynamics. A similar acceleration in mining activities was observed during the months leading up to the last halving event, which also arrived sooner than initially predicted. 

The crypto community is now keenly watching the countdown to the next halving, expected to significantly impact Bitcoin’s value.

The Countdown Adjusts: A Closer Look at the New Date

The halving, a pivotal event that halves the reward for mining new blocks, is now anticipated to happen around April 20, as per the countdown by Nicehash. 

This adjustment brings the event closer than the previously estimated April 28, echoing the slight jump forward of the halving date we saw before the last halving event four years ago.

How Will The Halving Affect Bitcoin Price?

The halving event is widely regarded as a catalyst for Bitcoin’s price surges. The underlying logic is straightforward: as the creation of new bitcoin decreases overnight and demand continues to soar, the growing scarcity of Bitcoin drives up its value. 

The upcoming halving will reduce the block reward to 3.125 BTC, down from 6.25 BTC, intensifying this effect and potentially driving Bitcoin prices to new highs.

The Evolution of Mining Technology: From S19s to S21s

The advancement in mining technology is evident in the recent transition from Antminer’s S19s to the more powerful S21s, significantly boosting the network’s hash rate. This technological leap underscores the mining community’s race to optimize performance ahead of the halving.

Bitcoin halvings are programmed to occur every 210,000 blocks, roughly every four years, to maintain the currency’s scarcity and value. Despite “difficulty adjustments” aimed at keeping a consistent block addition rate, bull market conditions can accelerate the blockchain’s pace.

The upcoming Bitcoin halving is more than just a scheduled adjustment; it represents a significant milestone in the cryptocurrency’s lifecycle at a time when the advent of Bitcoin ETFs has just unlocked a massive tidal wave of fresh capital, potentially setting the stage for unprecedented future value escalations. 

As the community and investors alike monitor these developments, the early arrival of the halving underscores the dynamic and unpredictable nature of the crypto market. 

Bitcoin History in the Making

For the first time in Bitcoin’s history, we have just seen an all-time high as we approach a halving event, signaling the potential for an even more monumental post-halving bull run than ever before. 

This surge is not only due to the traditional scarcity effect post-halving but is significantly bolstered by the infusion of fresh capital through Bitcoin ETFs, which have opened the floodgates for mainstream investors to enter the cryptocurrency market with ease. 

The introduction of these financial instruments has markedly expanded Bitcoin’s accessibility, attracting substantial new investment and likely setting the stage for an unparalleled rally in its value following the halving. 

For investors and cryptocurrency enthusiasts, the message is clear: purchasing Bitcoin before the halving could position you to take full advantage of this anticipated surge, potentially leading to significant gains as the market responds to these novel dynamics. 

This unique confluence of factors makes the upcoming halving not just a routine event in the crypto calendar, but a landmark moment that could redefine market expectations and outcomes forever.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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Bitcoin has captivated the attention of investors and technology enthusiasts since its inception in 2009. With its limited supply and the unique process of halving, Bitcoin has set itself apart from traditional fiat currencies. 

As we approach the next halving event expected on 19 April 2024, it is crucial to explore the impact of halvings on the cryptocurrency ecosystem and understand the potential opportunities that arise from buying Bitcoin before the halving. 

In this article, we will delve into the significance of Bitcoin halvings, examine historical patterns, and highlight the buying opportunity presented by this upcoming event.

Understanding Bitcoin Halving

Bitcoin halving is a fundamental aspect of the cryptocurrency’s monetary policy. Approximately every four years, the reward for mining new bitcoins is halved. This deliberate reduction in the creation rate of new bitcoins helps control inflation and maintain a predictable supply. By mimicking the scarcity of rare commodities, Bitcoin’s halving events create a sense of rarity and potential value appreciation over time.

During a halving, the reward for mining new bitcoins is cut in half. This means that miners receive fewer bitcoins for their computational efforts. The reduction in mining rewards serves the purpose of controlling the rate at which new bitcoins are introduced into circulation. With a limited supply of 21 million coins, the halving mechanism ensures that the creation of new bitcoins slows down over time. This deflationary nature sets Bitcoin apart from traditional fiat currencies, which can be subject to unpredictable inflation due to the discretion of central banks.

Historical Patterns and Price Action

Historical data indicate a consistent trend in Bitcoin’s price following each halving event. Past performance is not indicative of future results, but it provides valuable insights. In previous halvings, Bitcoin’s price has shown an upward trajectory in the months that follow. While it may seem counterintuitive in an efficient market, where events are anticipated and priced in, several factors explain this behavior.

The scarcity factor plays a significant role in Bitcoin’s price appreciation following a halving. As the creation rate of new bitcoins decreases, the existing supply becomes scarcer. This scarcity, coupled with increasing demand, can lead to a rise in Bitcoin’s value. The limited supply and the anticipation of reduced future supply create an environment where the demand for Bitcoin may outpace its availability, driving the price upwards.

Furthermore, halvings introduce a level of predictability and anticipation within the Bitcoin ecosystem. The event is widely known and followed by the cryptocurrency community, leading to increased attention and speculation. This heightened interest and speculation can contribute to price movements as investors and traders adjust their strategies based on the upcoming halving. The combination of scarcity and market dynamics during halvings creates an environment that has historically favored price appreciation for Bitcoin.

Stock-to-Flow: Quantifying Scarcity

One popular framework used to understand the impact of halvings on Bitcoin’s price is the Stock-to-Flow (S2F) model. This model quantifies the scarcity of a resource by comparing the available supply (stock) to the new supply added over time (flow). Bitcoin’s halving events effectively decrease the flow of new bitcoins, doubling the S2F ratio and increasing scarcity. Historical data supports the correlation between Bitcoin’s price and the S2F model, indicating that as scarcity increases, the price tends to rise.

The S2F model suggests that Bitcoin’s scarcity, as quantified by the S2F ratio, is a key driver of its price. The higher the S2F ratio, the scarcer the resource is perceived to be, potentially leading to higher demand and value. Proponents of the S2F model argue that Bitcoin’s scarcity is a fundamental characteristic that differentiates it from traditional fiat currencies and positions it as a store of value similar to precious metals like gold.

Plan B, the creator of the stock-to-flow model recently predicted that Bitcoin will actually exceed the Stock-to-Flow Model this cycle, as it has in the past after periods of underperforming the model.

It is important to note, however, that the S2F model has its limitations. It simplifies the relationship between scarcity and price, assuming that scarcity is the primary determinant of Bitcoin’s value. While scarcity is a significant factor, other variables such as market sentiment, adoption rates, regulatory developments, and macroeconomic conditions can also influence Bitcoin’s price. The model’s predictive power is based on historical data, which might not necessarily persist in the future. Therefore, while the S2F model provides a valuable perspective, it should not be the sole basis for investment decisions.

Macro Influence on Bitcoin’s Price:

While the S2F model provides a useful lens for assessing Bitcoin’s scarcity, it is essential to consider macroeconomic factors that surround Bitcoin halvings. Global economic volatility, shifts in monetary policy, and broader economic conditions can significantly influence Bitcoin’s price. Historical analysis of previous halvings reveals that heightened economic uncertainty often coincides with increased interest in Bitcoin, potentially amplifying the price effects of halvings.

The macroeconomic context surrounding Bitcoin halvings is crucial to understanding their impact on price. Economic factors such as inflation, monetary policy decisions, and geopolitical events can shape market sentiment and investor behavior. For example, during the 2020 Bitcoin halving, the COVID-19 pandemic led to large-scale stimulus measures and increased inflation expectations. As a result, individuals turned to Bitcoin as a potential hedge against inflation, driving up demand and contributing to its price appreciation.

Each halving event occurs in a unique economic landscape, and its effects are intertwined with broader market dynamics. Understanding the macroeconomic influences on Bitcoin’s price can provide valuable insights into the potential opportunities presented by halvings. 

Many analysts are anticipating a different trajectory for Bitcoin this halving, after the recent wave of Bitcoin ETFs opened Bitcoin to a wider spread of institutional investors. 

A Bitcoin Buying Opportunity

As we approach the 2024 Bitcoin halving, an opportunity arises for investors looking to buy Bitcoin. The historical patterns and the potential scarcity created by halvings suggest that Bitcoin’s price could experience an upward trajectory. While price appreciation is not guaranteed, understanding the dynamics at play can help inform investment decisions.

The buying opportunity presented by the 2024 halving stems from the combination of scarcity, historical patterns, and macroeconomic influences. Bitcoin’s limited supply and deflationary nature make it an attractive long-term investment option for those seeking an alternative store of value. The anticipation of reduced future supply, coupled with increasing demand, may contribute to the price appreciation observed in previous halvings.

As we count down to the Bitcoin halving event expected in April 2024, investors have a small window of opportunity to consider buying Bitcoin before the halving takes place. Historical patterns and the scarcity created by halvings suggest that Bitcoin’s price is likely to experience a strong upward trajectory following the halving event. 

However, it is essential to approach investment decisions with a comprehensive understanding of the complex dynamics at play. Factors such as global economic conditions, technological advancements, and market sentiment should be considered alongside the halving event. By carefully evaluating these factors, you can make informed decisions regarding the potential benefits of buying Bitcoin.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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The long-awaited Bitcoin bull run has officially begun, according to the famous analyst Plan B and his stock-to-flow model. 

Plan B is now expecting Bitcoin to break through and vastly exceed the stock-to-flow model’s upside in this cycle, just as it has done historically after periods of underperforming the model. 

The stock-to-flow model had been criticized as “broken” when Bitcoin prices were depressed below the model’s values in 2022. However, this is a pattern seen before, with Bitcoin eventually blowing past the model’s expectations as a new bull phase takes hold.

With only days to go until the next halving in April 2024, now could be an optimal time to buy Bitcoin before it potentially goes stratospheric. 

Historically, steep Bitcoin gains have followed in the wake of these halving events as new supply is cut in half, putting upwards pressure on the price.

When Will the Bitcoin Top Arrive?

Based on past cycles, Plan B predicts the peak of this Bitcoin bull run will likely occur in 2025, not 2024 as many analysts are anticipating. 

He anticipates Bitcoin will begin rising strongly after the halving event in April 2024, but with a slight delay as was seen in previous halvings. 

The “Red Dot” marking the start of the bull phase has now flashed on Plan B’s charts. This signals we have officially transitioned from the accumulation phase to a bull market phase, according to Plan B.

A bull market phase for Bitcoin is characterized by “face-melting FOMO, extreme price pumps, and multiple -30% dips” according to Plan B. 

The volatile conditions can be scary for those unfamiliar with Bitcoin’s cyclical bull markets. However, the analyst advises staying calm and not panic-selling during any incoming 30% dips, as they have been commonplace after past peaks.

In the 2017 bull run for example, there were around 5-6 separate drawdowns of over 30% before new highs were established. 

Thanks to improved fundamentals like the Bitcoin ETF launches drawing billions in institutional inflows, we could expect even more extreme price action in this cycle compared to 2017 and 2021.

How High Could Bitcoin Go?

Plan B’s charts reveal incredibly bullish signs that suggest Bitcoin has a long runway ahead in this cycle. 

The Relative Strength Index (RSI), a closely-watched technical indicator, recently hit 73. This is nearing the overbought levels of 90-100 that were sustained in past bull runs during periods of buyer euphoria.

While a high RSI can precede short-term pullbacks, Plan B notes that in a bull market, RSI readings of 60-70 can persist for extended periods as prices continue grinding higher. 

This is a stark difference from traditional equities markets where RSIs over 70 are considered strongly overbought. Bitcoin has a history of experiencing those very extended overbought conditions during its wildest upswings.

More importantly, Bitcoin is now trading well above all of its key moving averages and realized prices from historic buyer levels. This indicates there is a lack of strong resistance overhead as nearly all holders are in profit and unwilling to sell at current levels. 

The 200-week moving average of around $32,000 should act as a “floor” that will not get breached on monthly closes according to Plan B. 

More critically, he stated Bitcoin may “never again” trade below the $49,000 short-term holder realized price.

The data suggests that if you buy Bitcoin before the halving in April 2024, you could be well-positioned to capture exponential gains as this cycle’s bull run driven by the advent of institutional adoption potentially eclipses previous cycles.

Bitcoin is a revolutionary asset with a finite supply capped at 21 million coins. As new supply issuance is cut roughly in half every four years, upwards pricing pressure is typically applied in the year or two following these halving events. 

With Wall Street finally warming up to Bitcoin through vehicles like ETFs, and sovereign nation states exploring digital currency options, the fundamental investment case for Bitcoin has arguably never been stronger heading into the 2024 halving.

As always, this article does not constitute financial advice. You should be sure to do your own research and consult a professional financial advisor before making a major investment decision.

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