Will Bitcoin Dump, or Begin Trending in Confined way?
Bitcoin price seems to have been pulled back close to $14000 after it’s 12th Whitepaper day on 31st October. In fact, BTC price had crossed $14000 on its birthday for a moment. And currently, it is trending around $13,662 with a mere increase of 0.09% at the press time. What pulled back BTC from going beyond $14,000?
A new analysis emerged that point towards the sudden decrease in the hash rate which had reached more than 140THs but for now, it’s reduced to 107THs.
Adding to the substance, Bitcoin is anticipated to have entered a ‘capitulation phase’ yet again in 2020. In this phase, miners incur less or rather zero profits by Bitcoin mining. In fact, Bitcoin is due for a 15% difficulty adjustment which is considered as one of the highest in history.
The main reason behind Bitcoin entering this phase and dropping its hash rate is the end of monsoon in China. The hydraulic energy supported the Chinese mining activity and with the end, most of the mining rigs are expected to just shut off. And hence to compensate with the mining cost, the miners are forced to sell off their rewards, that’s Bitcoin which may shake BTC price to some extent.
As China contributes nearly half of the world’s mining hash rate, the decline in the Chinese hash rate would impact the whole Bitcoin space.
How Bitcoin and Altcoin Price Be Affected?
Bitcoin has entered the capitulation phase a couple of times before in 2020. And both the times BTC price has maintained a very narrow trend, actually a stagnant trend!
When the Bitcoin price remained almost stagnant for a long period, it signifies that investors had shifted their focus on the other flourishing altcoins. Therefore, it led most of the altcoin price surge with great numbers.
However, the most awaited ETH 2.0 is on its way, and after it goes live, most of the ERC-20 tokens and ETH itself are expected to go high. As Coinpedia reported earlier that there is a possible ‘Altcoin Season’ before 2020 ends, hence the initial phase of the season might have begun at present.
Is this the beginning of the Altcoin season or just a small relaxing phase for Bitcoin before a major jump ahead of $14,000?