Bitcoin defies skeptics, breaks $30,000

by James · April 10, 2023

Bitcoin takes back $30,000

The road to redemption for the world’s oldest and most popular cryptocurrency has been difficult (to say the least) and has had many skeptics. But last night Bitcoin broke the $30,000 mark for the first time since June 2022. Against all odds, BTC is up ~80% year to date. Here are some important things you should know:

“Buy when there’s blood in the streets”: More times than not, the best time to buy a market is when the news is at its worst. This proved to be the case for BTC and various BTC proxies such as Grayscale Bitcoin Trust (GBTC) and ProShares Bitcoin ETF (BITO). In November 2022, the doomed crypto exchange FTX filed for bankruptcy (after committing the biggest fraud since Madoff’s Ponzi scheme), shaking the crypto markets. In that short time, BTC has doubled.

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Safe Haven Asset: For several months in 2022, Bitcoin was closely correlated with stocks, especially technology, and the Nasdaq. However, in recent months Bitcoin has been trading more in sync with gold. Finally, it seems that the “Bitcoin Maximalists” who believe BTC is a safe haven and not just a “yolo” product of easy money central bank policy have something to hang their hat on.

Bitcoin Behemoth is back on the site: In 2020, MicroStrategy (MSTR), a public software company in business since the late 1990s, took the bold and unorthodox step of moving to the “Bitcoin Standard”. Led by its outspoken and eccentric founder Michael Saylor, MSTR has purchased nearly $4 billion worth of Bitcoin, which equates to approximately 130,000 BTC! In a testament to conviction or unfounded confidence (you decide), Saylor and MSTR have dollar cost averaged BTC all the way down finally back to their cost base of around $30,000 per coin.

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Bitcoin Halving is Estimated for Early 2024: About a year from now, Bitcoin will experience its next “Halving”. Bitcoin halvings happen every four years and refer to when the reward for Bitcoin miners (network validators) is halved. Each halving event means that the number of new Bitcoin released into circulation is cut in half. Remember, unlike central bank currencies, Bitcoin is finite – there will only ever be 21 million in existence. Previous halving events have led to dramatic bull markets in BTC’s price.

Miners are on fire: So far this year is Valkyrie Bitcoin Miners ETF (WGMI) is up 97%, making it one of the best ETFs in the entire market. The ETF’s top three holdings include Marathon Digital Holdings (MARA), HIVE Blockchain Technologies (HIV)and Riot Platforms (RIOT).

The long-term technical picture is improving: While it’s hard to chase Bitcoin into a big round number like $30,000 after a quick short-term move, BTC and BTC proxies like Grayscale Bitcoin Trust (GBTC) shows improvement in the long term technically. GBTC just triggered a bullish golden cross – a bullish technical signal that occurs when the 50-day moving average crosses the 200-day bottom. While the signal failed last time, when it happened in 2020, GBTC shot higher from $10 to $60, is fast order fashion.

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