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Bull or Bear? Investors Buy in During Bitcoin’s Dip

Is the market Bull or Bear? Investors are buying in during Bitcoin’s dip in price. The correction continues led by speculation around coin movement from an 11-year old wallet. About $80m worth of positions have been liquidated during the downturn but participants appear to be buying the dip. Open interest still sits at >$3b; long/short ratio @ 2:1.

More on the wallet activity; the coins were mined in ‘09 and inactive until a few days ago. While the market has come to a conclusion it’s NOT the act of Bitcoin creator, Satoshi, movement from old wallets still points to whale activity, and in this case, interpreted as a possible sell-off.

Another figure weighing on the markets is total hashrate, which continues to be stagnant at ~30% below the recent highs. Mining difficulty was adjusted down but 6% probably isn’t enough to get miners excited. 

On a positive note, Summer is typically strong seasonality for mining in China due to cheaper hydro electricity costs. This could drive a significant amount of rigs to come back online.

You can actually speculate on mining difficulty on FTX with their newly launched Hashrate futures. The most clear use-case looks to be for miners to hedge against faster than expected rises in difficulty.

Trader Insights

比特幣是個比黃金更好的投資?

比特幣是個比黃金更好的投資嗎?我們的創辦人Wincent和 行政總裁 Clement分別購買了1000克黃金等於一個比特幣的現金價格。我們的目標是將兩種對等價值的產品進行比較,2020年底便會知道哪種資產可帶來更高的投資回報率 (ROI)。

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