I was going to put something out today about about my new tipster discovery but, of course, UK racing is pretty much shut down at the moment because of Equine Influenza.
So, while the jockeys all sit around blowing their collective noses, I thought I'd share something else with you and this is pure information only to give you some over-dinner or around the pub conversation pieces.
Most people have heard something now about Bitcoin because now, of course, the mainstream media have got hold of it and, in their normal "let's forget about the facts" manner, have decided to talk about it whether they understand squiddly about it or not.
And, in my experience, they as a pack know less about it than my dogs.
Yes, strange as it might seem, I often keep my hounds posted on the current price of Bitcoin and, in return, am often greeted with slightly confused stares. That is until I suggest to them that this does have a direct impact (or certainly could have) on the affordability of dog food. My Golden Retriever definitely lifts her ears when I mention that.
Something on facebook caught my eye today which is kind of unusual as I rarely pay any attention to what's going on there as facebook tends to give me the screaming ab dabs.
However, to get to the point. One of the friends feeds I get had an interesting observation in it about Bitcoin. (Thank you Sean, I hope you don't mind me borrowing this).
Something I had never considered before as a way to assess where Bitcoin is going was to look at "all time lows". We tend to focus on how much the Bitcoin price increases and not too much on the overall trend across the years.
Why is this even worth a mention? Well, because Bitcoin is the most influential force to weigh upon all other cryptos. When Bitcoin is low and seen as going nowhere, all other cryptos are influenced greatly by that. Equally when Bitcoin goes off on one of its bull runs, then the rest of crypto world, or a lot of it anyway, follows it upwards.
This is a snapshot look at Bitcoins "lows" over the last 7 years:
2012 - $4 2013 - $65 2014 - $200 2015 - $185 2016 - $365 2017 - $780 2018 - $3,200
Do you see a pattern at all?
At its lowest point last year it was still $2,420 above its low in 2017 and, with the exception of 2015, has managed higher lows for each year other than that. So far this year, it has approached but not hit a low of $3,300.
Right now it is around $3,440. This overall trend could only be achieved if those who have or use Bitcoin is still significantly increasing and, more to the point, those prepared to hold on for better things to come are increasing in number.
So why should this be of interest to you?
Well, into it or not, this clearly shows me that Bitcoin is far from dead as the main stream media would have us believe and you may have some or might be one of many sitting on the fringe and looking for signs that it is here to stay and could still be a profitable thing to get into.
More importantly there is another noticeable trend, well more like a habit actually, with Bitcoin that few people would pick up on. And that is the mining reward trend and we should start to see signs of that kicking in very soon.
After every 210,000 blocks, with the next one estimated to occur on or around 27th May 2020, the mining reward for Bitcoin halves. It already went down from 50 coins per block to 25 coins per block and then 12.5 coins per block (where it is now).
It halved before in November 2012 shortly after Bitcoin went to over $1,000 for the first time and again in July 2016 after which Bitcoin went on its famous bull run to over $19,000. We often see history repeating itself so why should the 2020 halving be any different?
It will reduce next time to 6.25 Bitcoins per block. What this does is creates more rarity with Bitcoin so that what is already out there becomes more valuable. It is an immutable fact that only 21 million of them will ever be created and some of those have long been lost.
Now there are as many views about where Bitcoin will go in price as we approach the next halving as there are views on what we should do about Brexit.
I have heard everything from $20,000 to $300,000 proposed as a new all time high. At its absolute height so far, Bitcoin reached just over $19,500 so my own view is that $20,000 seems a low estimate.
I think it could well hit $30,000 or even $40,000 as we approach halving. I can't tell you exactly when that will happen but I expect to see that sort of price before the May 2020 halving occurs or, if not before, certainly just after.
Now a cautionary note:
I could be completely wrong and one biscuit short of a packet and I certainly wouldn't mortgage my house or go buy a runny-nosed racehorse on the strength of it.
But if I am right and you watch the price of Bitcoin for another month or two and do not see it fall below the $3,000 mark then we could be looking already at its 2019 low point. The best place for you to see Bitcoins' price is probably at www.coinmarketcap.com.
One final thought to take away, make of it what you will. The impact of halving tends to start to hit the Bitcoin price around (on average) 430 to 465 days ahead of the actual event (based on historical data).
Today (near as damn it) is 465 days away from the most likely next halving day.
I expect Bitcoin to reach a 2019 bottom of around $3,200 maybe $3,250 within the next few weeks and then, if history repeats itself, over the following 400 odd days; we could see a steady rise in Bitcoin again.
Food for thought...
Damn, did that horse just sneeze?
John
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