——Answer questions from group friends
Bitcoin’s new turning point
Yesterday, I answered a question from a group of friends with the article “How high can Bitcoin rise after the United States approves ETFs?” What is the impact of Bitcoin ETF funds on the Bitcoin trend? In general, ETFs have fundamentally changed the status of Bitcoin and are the third historical turning point of Bitcoin. The first turning point of Bitcoin was when Laszlo bought two pizzas with 10,000 Bitcoins, completing the thrilling jump of Bitcoin from air to commodity. The second time was the first time Bitcoin was traded on the Mt.Gox Exchange, ending a historic leap for Bitcoin as a trading medium. Bitcoin rose 100 times from its opening price in just 4 months. Why is ETF the third turning point in history? The approval of Bitcoin ETF means that the mainstream capital system has recognized Bitcoin. Although it is a belated positive, and I wouldn’t say I like Gary Gensler’s hesitation, his leadership of the SEC and himself will forever go down in the history of Bitcoin development because they pushed humanity towards the correct financial path. It is a significant long-term positive that affects the destiny of humanity. Positives are divided into long-term positives and short-term positives. The impact of long-term positives is calculated annually. It was not one year nor two years that fundamentally changed the development trajectory of Bitcoin. Bitcoin left the small pond, jumped over the dragon gate, and returned to the sea.
The following is a further answer to the question, “How high can Bitcoin rise after the United States approves ETFs?. Can you tell me more clearly when was the lowest point, how much it was, when was the highest point, how long is cycle, and what is the basis for predicting Bitcoin’s 3.3 trillion market value?”
ETFs play a decisive role in Bitcoin’s rise
The volume of ETF funds has played a decisive role in the rise of Bitcoin. Bitcoin will depend on the attitude of Wall Street for a long time. “How high can Bitcoin rise after the United States approves ETFs?” The article introduces the factors and basis for the rise of Bitcoin and will not go into detail.
Bitcoin has a coin-halving cycle every four years. With each halving, the supply is reduced by half. As long as demand remains unchanged, it will inevitably rise. The lowest point of this cycle is $16,000, which will appear in December 2022. Some concluded that Bitcoin has a price cyclical effect of a 10-fold increase. According to this inference, the high point is $160,000, and the difference between the high and low points of the previous cycle is 8 times. Bitcoin generally lasts more than one year in a bull market and more than two years in a bear market. It started rising in the months before the halving, reached a high in the first half to eight months after the halving, and came into a bear market. These experiences are not valid in the face of ETFs. I wrote an article in the past and predicted that without ETF, I would not even be able to pass 69,000. Now, the demand is different. The characteristics of ETFs are similar to bonds. The market capital is about 200 trillion. If 1% of the funds enter Bitcoin, it will explode. It only takes 40 days for mainstream funds to enter the market. The trend cannot be seen yet, and even the gods cannot predict it.
All Bitcoin operating experience is unreliable
ETFs fundamentally change the technical trend of Bitcoin. The original experience must be revised again. It will rise sharply but not necessarily fall sharply because your opponents are the predators on Wall Street. Big fish eating small fish is the unchanging logic of the capital market. Holding on to the coin is best when you can’t clearly see the future trend.
If you insist on making a guess, you must make assumptions. Based on the data of the past 40 days, assuming that the continuous inflow remains unchanged, the average inflow of ETF is 800 million per day, 292 billion in a year, and the inflow of stablecoin is 29.2 billion in a year. The sum of the two is 321.2 billion. , it will be halved in less than three months, and Bitcoin hoarding will reach 70% in a year. That is to say, assuming that 30% of all change hands, 321.2 billion can leverage a market value of 1 trillion. The coin price at this time was more than 100,000 US dollars each, a conservative estimate. In the last cycle of Bitcoin’s halving, it rose 8 times without the support of 10 times the funds in this round. Therefore, this round of 10 times effect should appear and exceed it. The long-term positive decision will be so high that you won’t believe it. Will it keep rising?
The reason for rising to 3.3 trillion
Simply put, Bitcoin’s market value of 3.3 trillion is calculated based on the unit price of Bitcoin of US$160,000 multiplied by 21 million Bitcoin. As mentioned before, ETF is a long-term positive. In the past, after Bitcoin surged, it would inevitably fall to digest the speculation bubble and slowly rise from the bottom because subsequent funds could not keep up. This time, the influx of ETF funds in the first 40 days was 10 times that of USDT. A simple estimate is that the digestion capacity is 10 times greater. In particular, ETF is a long-term positive and will change the original bull-bear time ratio of Bitcoin’s rise. The bull market has no ceiling, and Bitcoin has no top. How long does this mad bull take? It is what we have to judge. How to judge? It is also necessary to return to the analysis of primary funds. When Wall Street took action, the original Bitcoin trading giants became small shrimps. The time when the main funds determine the rising cycle will select the top of Bitcoin. The main funds believe that Bitcoin is a stored-value asset. It is a reasonable estimate that Bitcoin can occupy the second position among stored-value assets, and it is unimaginable to replace gold. When it reaches the second position, there will be disagreements on Wall Street, and then the stage top of Bitcoin will appear. At this time, the market value of Bitcoin was around 3.3 trillion, matching its status as the second largest stored value.
In just two days, the price of Bitcoin soared from 52,000 USD to a maximum of 64,000 USD, an increase of US$10,000. At the same time, the market value of Bitcoin has reached US$1.225 trillion, which is close to the market value of silver (US$1.277 trillion).
How to get returns comparable to those of Bitcoin back then
If Bitcoin continues to rise and surpass gold, a new narrative will be needed, further innovation will be required, and it will need to be related to daily payments. That is, the Bitcoin standard will need to be realized in order to realize Hal Finney’s conjecture: 10 million US dollars per Bitcoin. This idea has already taken shape in 2023, and the Bitcoin standard is the thinking of a dual-track currency system. It means that the fiat currency standard and the Bitcoin standard compete and develop in parallel. For the principles of the Bitcoin standard, please refer to the “Implementation of DW20 Decentralized Standard Currency” on the chainless website (chainless.hk).
Simply put, it is to set a ruler for Bitcoin, use Bitcoin to measure global economic development and use DW20 to replace stablecoins for daily transactions. Bitcoin and DW20 together form an inflation-free Bitcoin-based system. The issuance principle of DW20 is the same as that of Bitcoin, which also requires the process from air to asset coin (stablecoin). The difference is that DW20 adopts an unconditional airdrop method; anyone can receive it without any fee after registering for certification. Turning air into assets is a process of huge profits comparable to the vast wealth generated by Bitcoin mining in the early years. DW20 steps into the rhythm of Bitcoin and helps Bitcoin. DW20 is just like Bitcoin in the early days. It is only easy to make profits in the early stage. The earlier you register, the more likely you will achieve class leap. Download link: https://eco.chainless.top/download? code=8613510870809VJ You will receive a big red envelope that will rise, possibly to tens of thousands of yuan.
