THE BAD NEWS AND THE GOOD NEWS
What happened yesterday and what tomorrow brings
Many of us are, rightfully, asking concerning crypto prices, “What’s going on again?”, and there are simple answers out there. As the crypto press has been reporting in the past 24 hours: Upbit, South Korea’s largest crypto-currency exchange is under investigation, the Korean Financial Services Commission (FSC) conducted a raid on the Upbit headquarters. Also Bitcoin prices were affected adversely by rumors that the trustee of Mt Gox, the crypto exchange that closed down, is preparing a huge selloff of Bitcoin from the Mt Gox’s reserves. Allegedly, a website that has been tracking the Mt Gox wallet found that thousands of coins were moved to cold storage which usually suggests that a transaction is about to happen. The news are out, the FUD is spreading, people are selling, the prices are going down temporarily. We wouldn’t like to join the fear-spreaders, there is already too much unnecessary focus on that.
So, let’s talk about what’s worth talking about. A solid fundament for optimism. What we are writing about today is the news that came out in the last few days about mining prospects and their potential effects on crypto prices.
The news is simple, its significance is clear.
Independent research institute Fundstrat has reported that a Bitcoin mining boom is on the horizon that could potentially send the number one crypto-currency up to $64,000 USD by the end of 2019.
The company’s head of research, Sam Doctor, said in a report: “We believe the current path of hash power growth supports a BTC price of about $36,000 by 2019 year end, with a $20,000-$64,000 range.”
According to bitcoinist.com: “Fundstrat has estimated that the current cash break-even price Antminer S7 models is $6,003 USD per Bitcoin. The newer and more powerful Antminer S9, however, features a much lower break-even point at $2,368 USD. Both popular pieces of Bitcoin mining hardware are manufactured by Bitmain, which boasted an operating profit between 3 billion USD to 4 billion USD in 2017.”
Sam Doctor adds:
“The release of the next generation of rig hardware should trigger a new round of capex as well as hash power growth, which could accelerate if BTC price appreciates.”
Fundstrat’s predictions have turned out to be realistic so far, sometimes even too cautious. For example, Fundstrat co-founder Tom Lee previously predicted that Bitcoin may reach $20,000 to $55,000 by 2022. Ha said that last July when Bitcoin was trading at $2,540 and a figure like $20,000 sounded quite exaggerating, even for 2022. It didn’t take 4 years to get to $20,000. It took only 4 months. And now Fundstrat is talking about a BTC price of $36,000 and possibly $64,000 in one and a half years.