Jamie Coutts, the chief crypto analyst at Real Vision, has brought attention to an indicator that suggests a positive future for Bitcoin (BTC). According to Coutts, Bitcoin’s hash rate decline is slowing down, which typically signals a possible bottom and reversal from the current bearish trend. However, Coutts mentioned that any bullish movement still hinges on a stabilization of the downtrend.
Coutts also pointed out the percentage difference between the 30- and 90-day moving averages, indicating a similarity to previous hash rate contractions. This current contraction, post-2020 halving event, isn’t as severe as expected. The slowdown in Bitcoin’s hash rate decline is a significant development as it may suggest that miners’ capitulation could be coming to an end.
Willy Woo, a renowned crypto expert, previously stated that the market would start recovering once weaker miners exit the industry, and the hash rate bounces back. Woo explained that inefficient miners would face bankruptcy while others would invest in more efficient hardware. Ki Young Ju, CEO of Cryptoquant, offered insights into the potential end of miners’ capitulation. He indicated that it usually concludes when the daily average mined value hits 40% of the yearly average, currently standing at 72%. Ju suggested that it might still take some time before miners stop selling their reserves.
Ju advised market participants to prepare for a subdued crypto market for the next two to three months. He encouraged a long-term bullish outlook but recommended against taking excessive risks. Other analysts, like Mikybull Crypto, echoed similar sentiments, emphasizing that Bitcoin’s long-term trajectory remains optimistic as it is still a distance away from its peak in the bull market.
Coutts acknowledged the lingering impact of the supply overhang on the market. This pertains to the selling pressure brought on by the German government’s release of nearly 50,000 BTC. The absorption of this excess Bitcoin supply could potentially take some time before the market fully recovers from the aftermath of these distributions.
While there are challenges and uncertainties in the current crypto market landscape, the highlighted indicators suggest a promising outlook for Bitcoin’s future trajectory. It is essential for investors to remain cautious yet optimistic, keeping a long-term perspective amidst the fluctuations and challenges within the crypto space.
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