Bitcoin
BTC$70 734.57

1.57%

Ethereum
ETH$3 561.52

1.36%

Tether
USDT$1.000151

0.06%

Binance Coin
BNB$584.24

-0.38%

Solana
SOL$188.44

1.04%

XRP
XRP$0.623217

1.40%

Price follows hash rate: Bitcoin fundamentals drop may delay $14K


29 Oct 2020

#Bitcoin

Echoes of June appear among miners, but the future could likewise produce a price rebound if history repeats itself. Bitcoin (BTC) could see further downward price pressure this week as network difficulty is set to drop the most in five months.

Data from data resource BTC.com estimates that difficulty will drop by 8.3% at the next automatic readjustment in four days’ time.

Difficulty set to repeat June readjustment


The mining difficulty is an essential measure of the competition among miners in finding block subsidies, and by extension, the overall health of the mining sector. Automatic readjustments meanwhile fulfill an even more important function, allowing Bitcoin to sustain itself regardless of price action or other circumstances.

In June, difficulty dipped 9.3% following a previous 6.3% decrease, the latter marking the culmination of miner upheaval after Bitcoin’s block subsidy halving event in May.

The halving cut the block subsidy by 50%, producing a drastically different profit dynamic for miners operating on tight margins or with older equipment. The two consecutive downward adjustments opened up opportunities for less efficient miners once again, and difficulty corrected upward by almost 15% thereafter.

The latest fall, meanwhile, has been attributed to the end of the so-called “hydro season” for Chinese miners. This occurs each October, when rainfall in China’s Sichuan province eases and cheaper hydroelectricity dries up, pushing up costs.

Claiming Bitcoin’s final price hurdle


The knock-on effect, coming at a time when Bitcoin tried and failed to crack $14,000 resistance for the first time in almost 18 months, may be a longer withdrawal from that essential level. As Cointelegraph reported, hardly any technical resistance levels lie between $14,000 and Bitcoin’s all-time highs of $20,000 from 2017.

On Tuesday, developer Matt Odell summarized the process on Twitter: “Rainy season ended in china -> increased energy prices for hydro -> hash rate falling as miners transition to cheaper power -> blocks mined less frequently until difficulty adjustment.”

Odell was discussing another result of reduced miner activity — larger Bitcoin transaction fees, which have spiked almost 200%.

After June, price action slowly fell in line with both difficulty and Bitcoin network hash rate. Thereafter, as both metrics picked up, price staged a comeback of its own, bolstering a popular theory that price follows fundamentals and, in particular, hash rate.

Zooming out, Lina Seiche, managing director of Bitcoin media outlet BTC Times, drew attention to the hash rate’s overall strength. “The #Bitcoin hash rate is up 18% since the third halving, 9,300% since the second halving, and 554,000,000% since the first halving,” she tweeted this week.

Source


Related

NordFX Copy Trading: A Comprehensive Guide to Maximizing Profits
NordFX Copy Trading: A Comprehensive Guide to Maximizing Profits
Tips to Choose the Right Second Citizenship Program
Tips to Choose the Right Second Citizenship Program
Bitcoin’s continued slide down
Bitcoin’s continued slide down
A new round of crypto market mistrust
A new round of crypto market mistrust
Bitcoin holds its range, but pressure mounts
Bitcoin holds its range, but pressure mounts
Bitcoin unlikely to end correction
Bitcoin unlikely to end correction
Bitcoin looks set to take a severe dive
Bitcoin looks set to take a severe dive
Bitcoin set for a deeper correction
Bitcoin set for a deeper correction
Bitcoin falls under pressure
Bitcoin falls under pressure

Top Cryptocurrencies with Price Predictions

# Crypto Prediction Accuracy CVIX Price 24h 7d Market Cap 7d price change
1 Bitcoin (BTC) BTC Bitcoin predictions 79.6% 42 $70 734.57 1.57% 7.55% $1 391 140 747 215 BTC 7 days price change
2 Ethereum (ETH) ETH Ethereum predictions 77.2% 49 $3 561.52 1.36% 2.01% $427 638 198 492 ETH 7 days price change
3 Tether (USDT) USDT Tether predictions 96% 1 $1.000151 0.06% 0.01% $104 520 065 350 USDT 7 days price change
4 Binance Coin (BNB) BNB Binance Coin predictions 62.4% 81 $584.24 -0.38% 3.68% $87 364 761 086 BNB 7 days price change
5 Solana (SOL) SOL Solana predictions 58.8% 88 $188.44 1.04% 5.47% $83 742 639 571 SOL 7 days price change
6 XRP (XRP) XRP XRP predictions 80% 28 $0.623217 1.40% -1.26% $34 204 799 381 XRP 7 days price change
7 USD Coin (USDC) USDC USD Coin predictions 92.4% 2 $0.999973 -0.02% -0.02% $32 465 083 721 USDC 7 days price change
8 Dogecoin (DOGE) DOGE Dogecoin predictions 68% 66 $0.223035 9.88% 44.61% $32 041 022 250 DOGE 7 days price change
9 Cardano (ADA) ADA Cardano predictions 69.2% 65 $0.648010 -0.09% 2.81% $23 057 951 234 ADA 7 days price change
10 Avalanche (AVAX) AVAX Avalanche predictions 57.6% 87 $54.31 0.70% 0.04% $20 497 699 245 AVAX 7 days price change
11 SHIBA INU (SHIB) SHIB SHIBA INU predictions 58.4% 94 $0.000032 2.06% 16.86% $18 604 490 488 SHIB 7 days price change
12 Toncoin (TON) TON Toncoin predictions 61.6% 87 $4.91 -0.21% 21.37% $17 033 025 216 TON 7 days price change
13 Polkadot (DOT) DOT Polkadot predictions 74% 49 $9.49 0.09% 3.54% $13 542 332 162 DOT 7 days price change
14 Chainlink (LINK) LINK Chainlink predictions 77.6% 42 $19.11 -1.18% 4.52% $11 221 582 819 LINK 7 days price change
15 Bitcoin Cash (BCH) BCH Bitcoin Cash predictions 68.8% 59 $569.63 7.73% 37.59% $11 211 410 676 BCH 7 days price change

Be the first to receive Cryptocurrency Price Predictions and Forecasts daily

Get cryptocurrency price predictions, forecasts with analysis and news right to your inbox.

© 2015-2024 Crypto-Rating.com

The usage of this website constitutes acceptance of the following legal information. Any contracts of financial instruments offered to conclude bear high risks and may result in the full loss of the deposited funds. Prior to making transactions one should get acquainted with the risks to which they relate. All the information featured on the website, including information about the cryptocurrencies and bitcoin is intended solely for informational purposes, is not a means of advertising them, and doesn't imply direct instructions for investing. Crypto Rating shall not be liable for any loss, including unlimited loss of funds, which may arise directly or indirectly from the usage of this information. The editorial staff of the website does not bear any responsibility whatsoever for the content of the comments or reviews made by the site users about cryptocurrencies. The entire responsibility for the contents rests with the authors. Reprint of the materials is available only with the permission of the editorial staff.