bitcoin bottom

Clickbait hell, but yes, we are talking about the bitcoin bottom today and these 4 points will remind you that the current price (and very slight rebound) are not the bitcoin bottom you are looking for.

Number 1: All the charting in the world cannot predict the bottom of Bitcoin

I see a number of sites using traditional investment tools and strategies to predict the future of Bitcoin and other cryptos. The keep calling the Bitcoin bottom because of a “head and shoulders” pattern, or a “crossing pattern” or a “death cross”… whatever the terms they use, they are mostly full of crap for a simple reason: Bitcoin has absolutely no underlying asset value, you cannot take your bitcoin home and use it to burn in the fireplace or to feed the cat. Bitcoin does not exist. Normal investing is based on the performance, products, and results of ongoing companies or physically limited resources. Bitcoin is an artificial construct with no true value. So the bottom is only what anyone will pay for the rights to hold that bag of air, and nothing more.

Number 2: Miners are getting out in droves

The price of Bitcoins has dropped so much, that reports are coming that miners are literally selling rigs for their scrap value. Hashrate is one of the few true indicators of the amount of interesting in bitcoin, and that number has been dropping notably in the last few weeks. Hashrate has dropped from it’s peak of 61 million TH/s to as low as 34 million TH/s within a very short period of time. Right now, mining bitcoins costs more than you can get for the coins you produce. If people truly believed that the current drop is temporary, they would keep mining and life would be good. The numbers of people turning off is a good indication that this trend isn’t over yet. It also opens up Bitcoin for a 51% attack, where one group controls enough of the processing / mining to actually corrupt the system to their own ends.

Number 3: The positive news is more often speculative than factual

A number of websites generate daily news about coins and mining, and let me tell you, they pump out story after story about sunshine and happiness, citing various gurus about how things are turning around and that the current situation is temporary. They almost never address the underlying issues of bitcoin, such as the lack of public adoption of bitcoin for payment, or the slow speed of transactions (often days), or how easily the price of bitcoin can be manipulated. Nobody but nobody seems to want to talk about the distinct possibility of a 51% attack on bitcoin at any time.

Number 4: The only people calling a bottom have a vested interest in it

To understand this key point, you have to understand that pump and dump is pretty common in Cryptos. They buy cheap and promote the hell out of the product, often buying back and forth between various anonymous accounts they control, giving the impression of demand for bitcoin that likely does not exist. Speculators, not wanting to miss a good run-up put actually money into the game and buy the coins at the higher, inflated price, and the crooks walk away with a good profit. Over the next few days or weeks, the price drops again because there really wasn’t that much demand for it.

Bitcoin is only functional to these people if they have a way of turning mined coins and “low price” purchased coins into cash. That means they need new people to come in the doors all the time to buy the coins. They have a vested interest in saying “everything is great, this is the bottom, buy now and don’t miss out”. They also have a vested interest in not telling you the truth.