The dynamics of Bitcoin since the beginning of the year, its April successes and a number of other factors make analysts think that 2019 will be a year of growth for Bitcoin (BTC) .
"Bear Market" is over
Optimist Tom Lee from Fundstrat Global Advisors says that the long bear market is now a thing of the past, market sentiment has changed significantly, and investors' appetite for Bitcoin has grown significantly.
In an interview with MarketWatch, Fundstrat chief analyst said that there was a positive willingness to take risks associated with bitcoins, and that investors tend to find some “basic” bitcoin volatility.
Taking into account such activity of investors, Lee also added that in 2019, Bitcoin will reach $ 10,000, although he did not specify when exactly this will happen. Not so long ago, he also said that, given the costs of mining , the "fair value" of Bitcoin should be about $ 14,000.
In general, Fundstrat analysts believe that fundamental market forces have shifted in a positive direction, forming a “tailwind”, which in 2019 will push the price of bitcoin higher. At the time of the preparation of this post, the bitcoin rate was $ 5190 (+ 2.31%).
Terrible monetary policy will help to recognize bitcoins
Naim Aslam of Think Markets says that in general, the current monetary policy of central banks around the world is unsustainable:
“It seems like monetary policy has become a laughing stock. All she does is an aggravated buyout of assets and inflation of prices on them, while there are many questions about how independent the Fed is; as we see, they have no options, and people will turn to digital assets. ”
#ECB will consider if negative rates need #Draghi says amp # stimulus needed #Euro is plunging pic.twitter.com/Mqp00TqzCk
– Naeem Aslam (@ NaeemAslam23) April 10, 2019
“The European Central Bank will consider the need to mitigate negative rates; Mario Draghi says that a sufficient level of incentives is needed as the euro falls. ”
Travis Kling from Ikigai Asset Management recently called the central bank policy "politicized."
It seems that now such an irresponsible monetary policy is already inclining more and more people to use Bitcoins as a hedging tool.
Ignorance as the last obstacle
Although some commentators agree that Bitcoin will grow in 2019, there are still important issues that hold back widespread acceptance of cryptocurrencies .
Travis Cher from a well-known investment company Digital Currency Group believes that people need to bring a lot of knowledge so that they can evaluate cryptocurrencies.
For example, a survey conducted by the All-Russian Public Opinion Research Center (VTsIOM) showed that only 9% of Russians are familiar with cryptocurrency technology.
Scher said that much depends on the issues of education, and the average person knows little about the technology of the blockchain , although all this is very similar to the development of stocks or the Internet in the late 90s.
Publication date 15/04/2019
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Bithumb Cryptocurrency Exchange intends to enter the markets of the USA and Japan
Bithumb, one of the largest Bitcoin exchanges in South Korea, in the foreseeable future, may begin to offer services to residents of the United States and Japan. About this in an interview with Cointelegraph said BC Kim, CEO of the Blockchain Exchange Alliance (BXA), which owns the controlling package in Bithumb. According to him, the BXA strategy consists in the so-called reverse merger, involving the purchase of a company whose shares are already […]
Bithumb, one of the largest Bitcoin exchanges in South Korea, in the foreseeable future, may begin to offer services to residents of the United States and Japan. About this in an interview with Cointelegraph said BC Kim, CEO of the Blockchain Exchange Alliance (BXA), which owns the controlling package in Bithumb.
According to him, the BXA strategy is the so-called reverse merger, involving the purchase of a company whose shares are already being traded on one of the major exchanges. Among those, Kim names the Nasdaq and the New York Stock Exchange (NYSE).
Such a path may be faster than a traditional IPO, and will also help to significantly reduce the cost of listing on the stock exchange, which can reach $ 6 million.
As Kim says, BXA has already applied for legal support in the United States, and a lawyer from an unnamed firm said that the current regulatory environment allows the company to implement the stated plan.
BXA is also looking for partners in Japan, where it wants to create a joint venture to launch a officially licensed cryptocurrency exchange.
In addition, BC Kim said that he could potentially increase the share of BXA in Bithumb by buying up to 70% of the shares of BTC Holdings, the current operator Bithumb.
Additionally, he touched on the issue of the BXA's own token, which is already traded on the BitMax exchange, noting that its potential listing on Bithumb requires additional legal assessment.
Earlier this week, the Blockchain Exchange Alliance received funding in the amount of $ 200 million from the Japanese blockchain fund ST in the framework of the investment round of series A. As stated, investments will be directed to expanding the geography of Bithumb services, as well as adding new trading pairs to the site.
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The US government plans to increase spending on the blockchain technology 10 times.
Blockchain will become the main technology for the work of American civil and military government agencies.
The US federal government intends to increase spending on the blockchain 10 times – such data is contained in the report IDC Government Insights. According to the authors of the study, the amount of spending on this direction will increase to $ 123.5 million by the end of 2021, while in 2017 only funds worth $ 10.7 million were allocated.
It is also expected that spending on the implementation of distributed registry technology will also grow at the state and municipal level: in total, they will invest $ 48.2 million in this area over the same period, which is also about 10 times more than in 2017, when these goals were spent 4.4 million dollars.
If we talk about the structure of spending, then at least four times the costs of federal civilian authorities will increase, from less than 20 million to more than 80 million dollars over a specified period. The US Department of Defense will spend up to $ 40 million instead of $ 20 million, as in 2017.
As the head of the IDC research unit, Sean McCarthy, notes:
“We are confident that blockchain solutions will dominate in such issues of government functioning as state property management, identification of citizens at the border, as well as government procurement, when in the latter case everything goes from paper workflow to smart contracts .”
In the near future, much attention will be paid to investment in blockchains to improve logistics, including the deployment of new US military units in the EU countries. In addition, the distributed registry technology will continue its intensive distribution in financial transactions.
Publication date 20/04/2019
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Adamant Capital: Bitcoin has passed the bottom, the accumulation stage has started
According to analysts from the Adamant Capital cryptocurrency fund, the price of Bitcoin has really gone through the bottom, and the accumulation stage is now taking place – the first stage of the future bull market, when shrewd investors start preparing for the next rally. Moreover, say the authors of the report Tuur Demeester and Michael Leskrauvet, the general investor sentiment has changed from despair to hope. In support of this statement […]
According to analysts from the Adamant Capital cryptocurrency fund, the price of Bitcoin has really gone through the bottom, and the accumulation stage is now taking place – the first stage of the future bull market, when shrewd investors start preparing for the next rally.
Moreover, say the authors of the report Tuur Demeester and Michael Leskrauvet, the general investor sentiment has changed from despair to hope. In support of this statement, the researchers give a chart of the ups and downs of the Bitcoin price in combination with unrealized profits and unrealized losses. This criterion is based on the cost of each bitcoin, when it last moved (presumably, at the moments of buying / selling), accumulating into the “realized capitalization”. This indicator was then subtracted from the actual market capitalization of the cryptocurrency, as a result of which unrealized gains / losses were calculated.
Researchers are also convinced that at the moment Bitcoin is undervalued. The so-called “weak hands”, they said, left the market in November 2018, and this surrender laid the foundation for the next market cycle.
From this point on, “unrealized losses doubled in a matter of weeks”, prompting expectations of a rapid market recovery, the report says. However, when in just one month the market lost 48%, these hopes quickly gave way to despair.
This is also confirmed by Google Trends data, according to which search queries for the phrase “buy bitcoin” fell below the similar indicators of March 2017. Negative moods also prevailed in social media – if initially many investors were convinced that Bitcoin would not fall below $ 6,000, the further development of the event in the markets only intensified general pessimism, often even turning into aggression. So, representatives of Adamant Capital say that they received many letters at this time with threats and insults.
The report also describes in detail how the November capitulation changed the landscape of long-term and short-term holders of cryptocurrency.
So, in early 2018, many investors held onto their assets because of the so-called disposition effect — the tendency to hold an asset that has lost value, in the hope of selling it at a higher price. The November fall in prices, however, was a shock for many of them. For example, in the period from November 14 to 16, 2018, more old Bitcoins were sold than on February 23 of the same year, when the first cryptocurrency per day fell in price by almost $ 900.
This conclusion is similar to the analysis of unspent transactions Delphi Digital, published in January 2019, which also stated that Bitcoin is in the accumulation phase and that the bottom will be covered in the first quarter of 2019.
Be that as it may, Adamant researchers believe that the situation “improved markedly by the beginning of 2019,” and more and more investors began to hold their positions again. For example, on April 1, the number of long positions on Bitcoin futures from CME Group significantly increased.
The authors of the report also draw parallels with the previous market cycles, which, according to them, reinforce the thesis that we have again returned to the situation when we can speak about the undervalued bitcoin.
Another argument from researchers is market volatility. At the time of the publication of the report, the 60-day level of Bitcoin volatility was at a level below 5%, which has not been the case since 2016. According to Adamant, this reinforces the hypothesis that retail investors for the most part have left the market, and now long-term investors dominate there.
When is the moon?
The researchers emphasize that their findings do not mean that Bitcoin can not fall again to the values of November last year or even lower. Nevertheless, they expect that until the end of the accumulation stage and the start of a new rally, the cryptocurrency will trade in the corridor between $ 3,000 and $ 6,500.
Among the factors that can lead to lower prices are, for example, the possibility of a new major hacking of a large stock exchange, as was the case with Mt. Gox. Macroeconomic factors can also play a role, although in the long term, according to the report's authors, Bitcoin will be a safe haven for investors. Other risks include withdrawing from the market of miners (although this will be offset by increasing complexity ), regulatory threats, the ongoing civilian rehabilitation process of Mt. Gox , as well as new controversial hard forks.
When it is time to wait for a new bull market, the researchers do not say, but point to certain indicators that can help determine the accumulation phase: higher price minima caused by the fact that weak hands start selling during new rallies, as well as strong hands that do not buy Only these coins, but also buying Bitcoins during the price reduction, thus preventing them from falling even lower.
In addition, researchers draw attention to technical innovations that underpin their findings about the undervaluing of Bitcoin. These include the Lightning Network with its 45 percent monthly growth, as well as sidechains as an increasingly relevant and effective scaling solution. There is also a growing interest in cryptocurrency on the part of institutional investors.
Finally, the generation of millennials is likely to become another driver for the future rise in the price of Bitcoin. Having managed to catch the economic crisis of 2008, they are less likely to trust banks and governments, choosing alternatives such as Bitcoin.
“Basing our conclusions on the 10-year development of infrastructure, we believe that everything is ready for the truly five-year acceptance of [Bitcoin] to happen over the next five years. According to our estimates, during this period Bitcoin will become a more widely recognized tool for hedging investment portfolios, will increasingly be viewed as a reserve asset, and will also significantly enhance its status as a payment network, ”conclude the report.
Earlier this month, his report, indicating that a deep correction in prices of Bitcoin and the vast majority of the remaining altcoins may be behind and the so-called “bottom” has indeed been passed, prepared by the research division of Binance.
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