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Prediction: Bitcoin bullmarkt will stop at the earliest in September 2021

The reason is seen in hashrate calculations and potential of real economy growth

22.Mar.21 6:07 PM
By The reason is seen in hashrate calculations and potential of real economy growth


Prediction: Bitcoin bullmarkt will stop at the earliest in September 2021
Jiang Zhuur expects the current bullrun to end between September 2021 and June 2022. Zhuoer is the CEO of one of the largest Chinese mining pools called BTC.TOP.

He shares several reasons why he thinks the bitcoin bull market will end in the said period and the next bear cycle will begin.

The bitcoin mining pool manager talked to WuBlockchain about why the market could switch from bull to bear as early as September 2021 or even mid-2022, depending on a number of factors.

The term bull market is used to describe a longer period of growth. Growth in the value of a stock, or in our case of the cryptocurrency market. Bearmarkt is just the opposite. The meaning of a bear market is when the price or value of bitcoin is declining for a long time.

One of the reasons for his prediction is an economic recovery based on the roll-out of the Covid vaccine. As different economies become somewhat normal, Jiang expects interest in investing in cryptocurrency to decrease.

He also says that the momentum and optimism in the market must continue to be fuelled by public statements from large companies. Investments like Tesla's are needed to keep people interested.

In addition, Jiang mentions that continuing to buy by institutions will keep the bull market alive longer. He refers to Grayscale, whose assets under management continue to grow. There are also increasing opportunities for institutions to invest in bitcoin.

At the moment, there is a shortage of microchips in the world for various reasons. As a result, the prices of graphics cards, as well as mining devices, have increased considerably. According to Zhuoer, this is good for the price of bitcoin. This makes miners less likely to sell their bitcoins.

"There is absolutely a shortage of equipment right now, because since the coronavirus epidemic, the global supply chain has been interrupted and is now gradually recovering. But the demand for chips has increased enormously, so now all industries are short of chips, whether bitcoin mining or other industries.

The shortage of mining devices can be seen by the hash rate of bitcoin. Since its halving in May 2020, bitcoin's hash rate has risen from about 92 million terahashes per second to its current value of 166 million, an increase of 80%. The price of bitcoin, on the other hand, rose from 9,000 to more than 60,000 dollars, a profit of more than 600%.

The hash rate of Bitcoin has a relatively simple correlation with its price. Subject to new technological developments, price increases should be closely reflected by increases in hash rate. However, the hash rate has remained relatively stable in recent months.

This means that today's miners see much higher revenues for individual devices. Below is a chart of the hash price. Hash price is the revenue generated by miners based on computing power supplied.

For years the price of supplied computing power has been decreasing. This is mainly because machines become more efficient. There is no more mining on laptops or graphics cards of Game computers, the transition to ASIC is clearly visible. Since the beginning of this bull market at the end of 2020, the cost of supplying computing power to the bitcoin network has been increasing.

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