Bitcoin and the crypto markets continue to hang in a thread. The recent crash has bankrupted several crypto rental companies and hedge funds, and now mining companies are fighting for liquidity. Is the next crash imminent? What development do analysts expect?
Week after week, Bitcoin and the still young crypto industry are plagued by new bad news. Since the demise of Terras (LUNA, then renamed LUNC), companies have fallen like dominoes, illustrating the sometimes unhealthy structural interconnection. The crypto rental company Celsius Network, the competitor Vauld, the crypto bank Voyager Digital – they are all affected. Now the crisis is also affecting bitcoin miners: as blockchain researchers from, for example, Arcane state in a new analysis, the company’s revenues have collapsed by up to 80%.
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Not only the dramatically lower bitcoin price is burdening the operating company, but also the rising energy costs. According to Arcane, there is not even enough cash flow to pay for ordered hardware. “The Puell multiple, a metric that compares miners’ daily earnings to their annual average, is at a three-year low,” said Yassine Elmandjra, an analyst at ARK Investment Management.
6 / Miners face significant pressure. As stakeholders with the most skin in the game, miner capitulation is an important bottom marker.
Puell Multiple, a measure that compares daily miner income with its annual average, is at a low for three years.
– Yassine Elmandjra (@yassineARK) July 4, 2022
This puts Bitcoin under pressure: In order to remain liquid, the miners will at some point be forced to sell parts of their BTC holdings. From a perspective, however, the threat of miner capitulation also has a positive aspect because it is considered to be an indicator of the bottom. “As the most affected players, miner capitulation is an important bottom indicator,” Elmandjra said. In other words: in the past, things went up again afterwards. Bloomberg commodity strategist Mike McGlone also believes in a positive development in the second half of 2022.
With the Bloomberg Galaxy Crypto Index approaching a similar downturn as the 2018 bottom and #Bitcoin‘s discount to its 50- and 100-week moving averages similar to previous funds, tilts risk vs. reward against responsive investors in 2H.
– Mike McGlone (@ mikemcglone11) July 6, 2022
The reason: According to the analyst, Bloomberg’s “Galaxy Crypto Index” is behaving exactly as it did at the bottom of the bear market in 2018. So if the past is an indicator of future movements this time, Bitcoin is facing bullish months. A popular chart expert has now commented on how bullish it is.
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How expensive can bitcoin become?
“It is entirely possible that we could see another split at $ 12,000 […] experience, ”warns popular pseudonymous trader Altcoin Sherpa in a new video analysis.
External content from youtube.com is shown here.
At the same time, however, he is convinced that the Bitcoin price will explode again – in the middle of the bear market. He speaks of a “bear market rally where the price can rise more than you think.” His price target: “It could look like the price will rise to $ 30,000. I do not know if he has the power to get there, but that’s a scenario I see.”
First German bank with Bitcoin ATM
Apparently, Volksbank Bayern Mitte in Ingolstadt also believes in the success of Bitcoin: the region’s first Bitcoin machine was recently installed here. Customers in the bank can now exchange euros for bitcoins around the clock. “The Bitcoin machine is particularly suitable for beginners and beginners without much previous experience to familiarize themselves with the cryptocurrency,” emphasizes Andreas Streb, Deputy Chairman of the Board of Volksbank Raiffeisenbank Bayern Mitte eG. All you have to do is register and have a similar wallet on your smartphone, and you can exchange EUR for BTC. Streb adds: “Bitcoin is a relevant topic in all age groups. We have for some time now noticed an increased interest in cryptocurrencies among many customers.” They are convinced that more traditional banks will open up to cryptocurrencies in the future.
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