NewsBTC
What’s a good reason to buy Bitcoin? Well, the fact that it’s not going to crash is a good one. Looking at the charts can tell you a lot about what you need to know about a coin.
Bitcoin is over a decade old by now. This means that there is now a bit of history to go on. One way is the movements across the charts. Rise and fall times and bull and bear markets are good indicators.
Related Reading | Bitcoin Could Fall To $10K, Louis Navellier
Given this, there is an infamous video in the Bitcoin world. The YouTube video had surfaced six years ago in 2015. Jokingly telling people why they should not buy Bitcoin. Reason being that Bitcoin had always risen exponentially and crashed subsequently. Even though the poster knows the coin will still rise before the crash. The patterns presented in this video seem consistent. Following a timeline of rising and falls.
Obviously, this video has aged beautifully. It is still a joke that is passed around the crypto space.
Bitcoin Bull And Bear Patterns
Bitcoin has always seemed more like a bubble in its movement patterns. But unlike most bubbles, it keeps coming back.
Even bull market has always followed a halving event. And halvings happen every four years.
A halving is when the reward that is gotten from mining Bitcoin blocks is cut in half. When Bitcoin first launched, you got 50 Bitcoins for each block. After the first halving in 2012, the reward was cut down to 25. Then 12.5 after the next halving in 2016. The most recent halving happened in July 2020. Right in the heart of when the bull market began.
Bitcoin maintains price above $30K | Source: BTCUSD on TradingView.com
The current reward for mining a block is now 6.25 Bitcoins. With each halving, the price of Bitcoin surges. This is due in part to there being less Bitcoin going into circulation. The scarcity model of Bitcoin is what makes it such a high-value asset. And it is why it is inflation resistant. You simply cannot make more.
The halvings mean miners are getting fewer rewards. This means that they are having to list their bitcoins at higher prices to break even. And by the next halving, miners will get 3.125. A much lower amount of rewards in just 16 years.
The bitcoins gotten would have to be listed for about $100K or so to break even and make profits. This will be a big driver in the next bull market. As it has always been in the markets.
Low Prices Does Not Equate To A Crash
Bitcoin price movements have always been erratic. Bull markets always end in a bear.
But just because the price is low at some point does not mean the asset has crashed. All assets go through periods of a downtrend.
The widely volatile nature of Bitcoin is something that scared a lot of investors away. But it is also something that draws most investors in. An asset that has the potential to move by a wide margin is an asset that people want to invest in.
Every end of a bull market has people calling it a market crash. But the market always picks back up. We have had a good number of bull markets now. And there is no reason to believe that it is going to stop now.
Related Reading | Why Bitcoin Could Still Hit $100K This Year
The current movement patterns suggest that bitcoin might have broken its normal bull and bear cycles. It’s going on a year and bitcoin is still above the previous all-time high. Prices are currently still holding steady at $30K.
If Bitcoin continues its pattern, then it will never fall below previous all-time highs. This means that Bitcoin would currently not fall below $19K. Although a more conservative number would be $15K. Since the 2017-2018 bull market ran a bit higher than anticipated.
Regardless, this would mean a lot of the crash predictions would fail.
Featured image from Nairametrics, chart from TradingView.com
via NewsBTC