BITCOIN:FUNDAMENTAL ANALYSIS + TECHNICAL ANALYSIS

11 mar 2023

Hello there! If you're a fan of blockchain-based tokens and are considering investing in cryptocurrencies, you might want to consider purchasing the "progenitor" of cryptocurrencies, Bitcoin. Although cryptocurrencies are generally known for their volatility, investing in an expensive token like Bitcoin can somewhat reduce that volatility compared to low-cost cryptocurrencies like Ripple and Cardano, which tend to move more quickly.

It's important to note that even though Bitcoin is a five-figure token, it's not incapable of skyrocketing. In fact, under the right conditions, it can provide the perfect combination of stability and explosive growth. While critics have predicted Bitcoin's demise every time it has collapsed since its inception in 2009, it has always fully recovered, and a full recovery to its previous peak of $69,000 would represent a 3-fold step.

Critics of cryptocurrency like to say, "It's different this time," but Bitcoin's impeccable track record of fully recovering from at least half a dozen crashes puts the burden of proof on the bears until proven otherwise.

So why did Bitcoin collapse this time around? Concerns about increased regulation of cryptocurrencies and the issue of legitimacy are certainly part of the bigger picture, but the main factor contributing to its fall, which began in late 2021, was undoubtedly the market's fear of rising interest rates.

However, it's important to consider whether Bitcoin is really competing with government bonds like stocks of big companies are. Currently, 401(k) plans and other large investment funds consist primarily of stocks and bonds, and you won't see bonds competing with Bitcoin for space in these funds. If anything will be temporarily squeezed out of this list when bond yields rise sharply, it will most likely be stocks.

Bitcoin's battle for legitimacy and regulatory recognition is currently being fought in the courts. Grayscale has sued the Securities and Exchange Commission (SEC), claiming that the regulator unfairly rejected its application to convert its Grayscale Bitcoin Trust fund into a full-fledged spot Bitcoin ETF. Grayscale claims that approved Bitcoin futures ETFs already exist, and it's not being consistent or impartial.

Bitcoin is too big and influential to ignore; its market value has already surpassed that of Visa and Mastercard. At this point, regulators must be quick to check and slow to embrace new technology, especially when it disrupts the status quo.

While there's no guarantee that a legal Bitcoin ETF will appear in the near future, if and when it finally does, it could open up convenient and affordable access to the world of cryptocurrency to the masses. The creation of Bitcoin-based investment vehicles available through popular stock brokers, 401(k) plans, and investment advisors should be a watershed moment.

So, feel free to consider taking a moderately large position in Bitcoin before that spaceship leaves the launch pad. Bitcoin's past propensity for a dynamic recovery when it finally happens suggests the possibility - perhaps even the likelihood - of a rocketing takeoff sooner rather than later.

17 mar 2023

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