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This leads me to a projection. The projection is mainly based on the idea of averages. The averages can tell us where Bitcoin is on a binary scale: overvalued or undervalued. Assuming that Bitcoin's true value is still increasing, investing in Bitcoin is still a good choice on the long term. But timing your entry right can mean the difference between a big win and a massive win.
The idea of the chart is that big bottoms in a cycle occur in an area far below the purple line. The purple line (in the 3Day chart) is currently at $20,000.
We have seen that the Bitcoin markets have plenty of speculative money in them + derivative trading. What goes up big time, can also go down big time. Especially in times of fear.
The assumption underlying the chart is that the current financial markets move along until something breaks. That's how it usually goes. A bank going bust, a large company is marked junk. It could be anything that suddenly breaks the markets. Stonks slide, yields go down and everything is sold in order to obtain cold hard cash.
The FED and other CBs step in and 'save the day' by printing even more money. After the panic subsides, market participants jump back in with both hands on the waves of yet another Great Reflation.
I take this as the default scenario.
The chart is essentially about extending the moving averages based on the 2018-2019 bear market (copy/paste). Extend and duration will probably not match the future; it's just an 'what if' exploration. For instance, the March 2020 panic will probably remain an outlier.
The chart gives me confidence:
- even in a major downturn - a Bitcoin bear market and/or the GFC 202x occurring - price is not expected go lower than approx 50% from here
- with nothing fundamentally changed to the long term Bitcoin growth drivers, buying a bit at this price point is fine
- this is the worst case scenario for me. Working through this period will probably take less time
I have come to the same conclusion. But arrived at it using mining data.
Best miner does about 30 watts a th
so a th earns 22 cents
lets say I have 100 of them
100 x .22 = 22 dollars a day
30 watts x 100 = 3000 or 3 kwatts or 72 kwatts a day
at 5 cents = 3.60
22.00- 3.60 = 18.4 that is 0.000555 btc
or 1/0.000555 = a factor of 1801.80
1 = 1 btc
to earn 1 btc a day
1801 x 3.60 = 6483 in power
while it seems way under the 15000 number for the low it neglects costs of your building your internet your wiring and your miners
A s19 went for 6000 at Bitmain it has a 2-3 year life on average so it cost 8.22 a day to own it. use 8.22 x 1801 you get 14,804
so 14,804 + 6483 = 21,287 which is well over 15k
but s19 also went for 3000 at bitmain
that means 4.21 a day to own
or 7,402 + 6483 = 13885 which is under 15k
the cost of the s19 is base on 2 year not 3 year.
I get 21,287+13885 = 35172/2 = 17586 fairly close to his 15k number.
I do suspect the life span to be over 2 and under 3 years. which means that 17586 is a bit high but not off by much remarkable that it is so close to his 15k number. Since the way to get the number is very different.
So basically for mining a btc I get true cost close to 15-18k .
I mentioned earlier that this is different than 2018 here is why.
2017 12/31 diff = 2.60th
2018 01/31 diff = 3.01th
2018 02/28 diff = 3.46th
2018 03/31 diff = 4.02th
2018 04/30 diff = 4.31th
2018 05/31 diff = 5.08th
2018 06/30 diff = 5.95th
2018 07/31 diff = 6.73th
2018 08/31 diff = 7.15th
2018 09/30 diff = 7.45th.
2018 10/30 diff = 7.18th
so with faltering prices the diff rose 9 months in a row
that is not true right now.
and this means it is different this time
"fact not conjecture"
Just not sure what will happen. Due to this fundamental difference in mining profit.
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