The bitcoin rate has fallen to the lowest point of the past seven months. For anyone who has been in bitcoin for a while, this is a recognizable pattern. The rate is falling and falling, recovering, falling again, rising slightly, etc. Sometimes it is difficult to stay positive, therefore these three reasons why bitcoin climbs out of this valley.
Nicholas Merten from the fantastic YouTube channel DataDash sees three reasons for a recovery. Under his tweet, we elaborate on his argumentation.
For those who are worried, remember this:
Markets are simply about inflows and outflows. When:✔️ The halving cuts new daily issued bitcoin in half
✔️ PlusToken finishes selling its bitcoin & ether
✔️ More institutional on-ramps become availableBitcoin will reverse and quickly
– Nicholas Merten (@Nicholas_Merten) December 17, 2019
✔ The halving ensures a halving of new bitcoins
The halving should not be underestimated, this is an important event for bitcoin concepts. The Dutch bitcoin analyst PlanB looked at earlier halvings and concluded that the course then took major steps. He thinks that the next halving in May 2020 could be the starting signal for new growth.
Getting some questions about why in previous halvings (November 2012 and July 2016) it took well over a year for the market to start surging ..
Well, it didn’t .. look for yourself: in the chart the halving is when blue turns to red: the market immediately rises after a halving? pic.twitter.com/geL71dJOV7
– PlanB [Jan/3➞? ] (@ 100trillionUSD) December 3, 2019
The countdown has begun, the halving is in about 150 days. That is, if you have to believe the counter. The theory, which is very bullish, says that halving causes falling bitcoin inflation, a decrease in the available supply and a doubling of the stock-to-flow.
Almost everyone agrees that halving can only have a positive effect on the value and scarcity of bitcoin.
✔ PlusToken’s stolen coins are not endless
Another widely accepted theory is that South Korean PlusToken is one of the biggest scams in the early history of bitcoin. And that the effect of this pyramid scheme can still be felt this year and early 2020.
Blockchain research agency Chainalysis published an analysis yesterday stating that PlusToken still has 20,000 bitcoins (worth 123 million euros) and 790,000 ethers (worth 92 million euros). That is more than enough to influence the rates of both coins. But also this stock is at such a moment so low that the worldwide rate no longer feels anything.
According to Ergo, PlusToken sold 1,100 bitcoins daily via mixers and exchanges. That number seems to be decreasing. In his latest analysis, he talks about 500 bitcoins per day.
TLDR:
PlusToken coin distribution has dropped off a cliff (<<< 500 BTC / day).
Most coins have been processed through Huobi, but I still need to look into this more.
– ∴ Ergo ∴ (@ErgoBTC) December 13, 2019
This may indicate that the sales pressure from PlusToken is decreasing. One of the reasons why the bitcoin rate almost only went down in recent months is because PlusToken had to get rid of their coins.
✔ More options for buying bitcoins
This year a number of new products have been released, making it easier for institutional and private individuals to join. And it does not seem that the road to maturity of the crypto industry will decrease in 2020. It is also expected that more strike products will come on the market and that DeFi will become even larger. For the time being, these focus mainly on private individuals, but at a certain point the switch to institutions will also be made.
But that is only possible if there is a strong framework of regulations, so that these institutions dare to step in. Last year Bakkt is a good example of this. The impact of Bakkt on the bitcoin rate is currently zero, but it does ensure that there are new “onramps”.
If we zoom in on Dutch private individuals, 2020 can be a strange year. The expectation is that on January 10 new rules will be introduced for the crypto industry, making it more difficult to start a bitcoin company. At the same time, existing parties are working on strengthening their brand and product. Think of the BLOX app, developed for newcomers to the cryptomarket.
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