25 Sep 2020 #Bitcoin
A long-term downtrend flips to form bullish support as Willy Woo says Bitcoin’s days of tracking traditional markets are numbered. Bitcoin (BTC) may soon “decouple” from traditional assets, says statistician Willy Woo as a key gold relationship breaks out of a long-term downtrend.
In a tweet on Sep. 25, Woo forecast that Bitcoin would act like a successful startup in accruing new interest and going its own way.
Adoption, he argued, would follow a classic S-curve pattern, much in the same way that a startup grows. This would take precedence over investors looking for a hedge against other assets.
“Bitcoin will decouple from traditional markets soon, but driven by its internal adoption s-curve (think startup style growth) rather than changes in perceptions as a hedging instrument by traditional investors,” Woo wrote. “Fundamentals of user adoption have already broken all time highs.”
As Cointelegraph reported, both Bitcoin network hash rate and difficulty are at record levels, underscoring the competitiveness and long-term appreciation of profitability among miners. Just as Woo predicted a breakaway from Bitcoin’s current dependency on factors such as the U.S. dollar currency index (DXY), another chart highlighted that change may already be afoot.
Bitcoin’s price ratio versus gold, in a downtrend since the all-time BTC/USD highs in December 2017, broke to the upside when the pair reclaimed $12,000 at the end of July. A subsequent retest of the trendline appeared to confirm new support, resulting in a bounce to the upside. The weekly chart performance over the past three years was keenly noted by Travis Kling, hedge of crypto hedge fund Ikigai.
Woo’s words meanwhile come as arguably this year’s biggest Bitcoin adopter, MicroStrategy, likewise denies that its move to purchase $425 million of BTC was a hedge.
In an interview with RT host Max Keiser on his Keiser Report TV show on Thursday, CEO Michael Saylor explained that he genuinely wanted MicroStrategy to adopt a “Bitcoin standard.” “What we have is a war on currency, and not a war to make the U.S. currency weaker than the euro; the war on currency is anybody holding currency is getting attacked,” he said. “And so now we’re starting to realize that currency is being made toxic by the political… financial policies of the central banks, you kind of have to run away from that currency to something that’s not toxic, and I think that Bitcoin is that non-toxic currency.”
He noted that swapping cash for Bitcoin also made sense because scarce assets were inflating by up to 25% in 2020, and 10% each year thereafter. Sitting on cash reserves, therefore, was akin to an “ice cube that’s melting.”
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