- Chinese miners are unlikely to be the primary drivers of Bitcoin’s recent negative price movement, according to Eric Wall, the chief investment officer of crypto investment firm Arcane Assets
- The major driver of Bitcoin’s price fluctuation, according to Wall, is emotion, not mining activity, the majority of the market, by far, is driven by broad brush psychology
- The growth of crypto’s infrastructure, according to Wall, will have a long-term influence on the value of the dominant currency
According to Eric Wall, the chief investment officer of crypto investment firm Arcane Assets, Chinese miners are unlikely to be the major drivers to Bitcoin’s current negative price movement. In a tweet, Wall claims that the quantity of Bitcoin traded by Chinese miners is a small percentage of the market’s daily turnover, and so has minimal influence on BTC’s value. The CIO of Arcane Assets reminds us that only 900 Bitcoins are generated every day, and even when miners hoard, their stock is only about five times the daily worldwide output of BTC. Miners mine 900 BTC each day, and if they were hoarding, they could only sell 4,000+ BTC per day for several days in a row.
The insignificant daily output of BTC, according to the crypto investment business executive, is not a substantial factor in the selling pressure. Wall emphasizes that emotion, not mining activity, is the primary driver of Bitcoin’s price movement. The market, by far the majority of the market, is driven by broad brush psychology. You can have a lot better sense of what’s going on if you talk to enough traders and investors and evaluate their emotions, concerns, hopes, and stamina.
In addition to market mood, Wall believes that the development of crypto’s infrastructure will have a long-term impact on the value of the dominant coin. Bitmain, the world’s largest cryptocurrency mining equipment manufacturer, stated that it has stopped selling machines in the spot market due to increased demand on the secondary market. BTCChina, China’s first Bitcoin exchange, said that it has abandoned the digital currency.
Bitcoin mines may ultimately migrate out of China, but Cao believes that the manufacture of Bitcoin mining devices will continue in China due to market demand. He also predicted that the price of mining machines will continue to fall in the short term, as market willingness to absorb the excess would be tepid given the recent market instability in numerous cryptocurrencies. There are, of course, other factors that will influence markets over the long term.
Baby boomers are passing on their wealth to millennials ($70 trillion over the next three decades). On-ramps are being constructed. Better investing instruments are available. The user experience has been improved. The demographics are changing. Regulations and tax treatment have been improved. Although people are blindly running after crypto investments because of the huge amounts of profits that they are making, it is quite evident to the sata analysts that the market will collapse, sooner or later.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.