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⚡Bitcoin Speculators Hold Tight🐅

Croxroad

13 Jul 2024 — 6 min read

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😷 In Face of Losses

Bitcoin long-term holders are refusing to sell in the current BTC price cycle’s “deepest correction.” In the latest edition of its weekly newsletter, The Week Onchain, crypto analytics firm Glassnode delivered good news on Bitcoin hodler resilience. Glassnode praises the “robust” Bitcoin market, noting that despite experiencing its heaviest drawdown of the current bull market, its “diamond hands'' show no sign of panicking. For Glassnode, “if we look at performance indexed to the date of the Bitcoin halving, we can see that the current cycle is one of the worst performing.” This is despite the market breaching a new cyclical all-time high (ATH) prior to the halving event in April, which was the first time this has happened.

In contrast to some well-known capitulation events in Bitcoin’s recent history, Glassnode shows that long-term holders are sitting on their BTC. Even the recent trip to four-month lows of $53,500 for BTC/USD failed to shake their resolve. Glassnode’s data indicates that “loss taking events this week account for less than 36% of the total capital flows across the Bitcoin network.” Major capitulation events, such as in September 2019, March 2020, and May 2021, saw losses account for more than 60% of capital flows over several weeks. This resilience is evident as long-term holders, defined as those holding BTC for more than 155 days, are not participating in onchain selling at a loss during the current price drawdown.

Glassnode produced a chart showing the distinct absence of long-term holder participation in onchain selling at a loss during the BTC price drawdown. “Following 18 months of up-only price action after the FTX implosion, and 3 months of apathetic sideways trading, the market has endured its deepest correction of the cycle,” it wrote. “Nevertheless, drawdowns across our current cycle remain favourable when compared to historical cycles suggesting a relatively robust underlying market structure.” As Cointelegraph reported, short-term holders and day traders are in focus as profit margins flip negative. At the $53,500 lows, short-term holders held nearly 2.8 million BTC, or 14.2% of the total supply, at an unrealized loss. Miners, too, are causing concern, with a hashrate capitulation phase ongoing. Charles Edwards of Capriole Investments warned that while the biggest Bitcoin drawdown since the FTX collapse has been signalled, a buy signal could be “at least a couple of weeks away.”

🛜 Why Is Bitcoin Like Internet

In this insightful interview on the "Croxroad" podcast, Arvind Nathan, Executive Director at a Melbourne-based support services group, explores the striking parallels between Bitcoin today and the internet at the end of the 20th century. Nathan shares his journey from initially exploring Ethereum for smart city projects to embracing Bitcoin as a means to ensure decentralisation and privacy. He delves into Bitcoin's financial implications, highlighting its potential as a hedge against inflation and a tool for financial sovereignty. The discussion covers the current global adoption patterns of Bitcoin, drawing comparisons to early internet adoption and forecasting economic shifts. Nathan also examines Bitcoin's ability to address fundamental human behaviours and its potential to drive future technological innovation. Tune in to "Croxroad" for a deep dive into why Bitcoin's current state mirrors the internet's transformative early days and what this means for the future.

Arvind Nathan is a notable figure in the Bitcoin research community, renowned for his insightful analyses and strategic foresight. Based in Melbourne, Australia, Nathan brings a rich background in IT sales, consulting, and strategic planning to his current role as Executive Director at a support services group. His career has spanned various sectors, including telecommunications, where he held a leadership position at Telstra, one of Australia's largest telecommunications companies. Nathan's journey into the world of Bitcoin began with a focus on Ethereum and its applications in smart city projects. However, his concerns about privacy and government surveillance led him to shift his attention to Bitcoin. This transition was further solidified during the COVID-19 pandemic, as he witnessed the erosion of personal freedoms and recognized Bitcoin's potential to ensure decentralisation and privacy. At the forefront of his research endeavours is "The Bitcoin Curve," a publication dedicated to exploring how Bitcoin can scale beyond being just digital money. Nathan's work delves into the principles of Bitcoin, technology adoption, and public interest technologies, providing a comprehensive analysis of Bitcoin's role in society. Through "The Bitcoin Curve," Nathan aims to educate and inspire a broader understanding of Bitcoin, highlighting its potential to revolutionise not only finance but also human behaviour and global economic structures.

Exploring the parallels between Bitcoin and the early internet, Arvind Nathan, Executive Director at a Melbourne-based support services group, draws striking comparisons that illuminate Bitcoin's transformative potential. Nathan's background in IT sales and consulting lends a unique perspective to his insights on how Bitcoin mirrors the internet's evolution. Initially drawn to Ethereum for its applications in smart cities, Nathan's journey shifted towards Bitcoin amidst concerns over privacy and government surveillance. This pivot was solidified during the COVID-19 pandemic, prompting Nathan to recognize Bitcoin's role in safeguarding personal freedoms and promoting decentralisation. In his analysis, Nathan highlights how Bitcoin's current adoption stage mirrors the internet's trajectory in the late 20th century. He discusses metrics and benchmarks, comparing Bitcoin adoption rates globally and identifying emerging economic hubs in regions like Argentina, Singapore, UAE, and Thailand. Through "The Bitcoin Curve," Nathan explores how Bitcoin addresses fundamental human behaviours and societal needs, akin to how the early internet paved the way for technological innovation and economic growth. His insights on Bitcoin's potential to reshape global finance and foster innovation make this interview on the "Croxroad" podcast essential listening for those curious about the future implications of cryptocurrency.

🫙 Storage

When you purchase Bitcoin, you gain ownership of the amount bought, secured by two keys: a public key and a private key. The public key, acting as your wallet address, encrypts information, while the private key decrypts it, granting access to your Bitcoin. Safeguarding this private key is crucial.

Your Bitcoin ownership is recorded, stored, validated, and encrypted on the blockchain. Due to advanced encryption, altering blockchain data to steal cryptocurrency is virtually impossible with current technology, making brute-force hacking infeasible for centuries.

However, your wallet, which stores your private key, is typically software on a hardware device and can be hacked. This makes the interface between the blockchain and the user the most vulnerable point.

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