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The crypto market is a volatile world, with price changes constantly occurring. Recently, Bitcoin received a rebound and rose; however, how long this rise will continue remains to be seen. The recent changes may seem confusing to many novices and experts in the field alike. For any newcomers to the world of Bitcoin, there’s a lot to understand and improving one’s crypto literacy is a must as we advance. As such, a recap of the recent events is much-needed.
The recent turbulence on Bitcoin can be most notably seen with the sharp increase in its price after the 10th of July; however, while the spike was high, it has plateaued temporarily. The current point of the plateau still sits noticeably higher than the token’s standing a few weeks ago and marks the highest price this month before its slight drop.
The current situation is not the same as earlier this year, as Bitcoin’s price goes up. For miners, this means a lower yield while operating costs skyrocket. Government regulations, primarily in locations such as China, only worsen the problem.
With only a glance at the turbulence and diminishing returns, it’s easy to assume the crypto path is doomed. However, this is a foolhardy judgment, as the mining sector has shown remarkable resilience these past few years alone. Remember, as miners sell due to pressure, the price will fluctuate and potentially decrease.
Miners play an essential role in the crypto world and can be considered one of the currency’s backbones. Computers are used to unscramble complex mathematical problems, verifying and batching transactions into blocks. For their efforts, miners earn new bitcoins alongside similar transaction fees. This process is called block rewards and can vary depending on a miner’s contribution.
When the price of BTC drops, so does the profit margin of all miners. Mining is energy-intensive and results in a significant cost. The cost to mine significantly affects miners whenever the price of the currency drops. Such situations can cause capitulation, where miners sell off equipment or Bitcoins. Capitulation can occur from miners moving onto other investment sources and abandoning their mining or investing in more efficient setups.
Miners collectively hold most of the BTC available, and selling this off often drives down the token’s price. As a result, a negative feedback loop can quickly occur, with more miners selling as losses increase and the cycle starts over.
While live prices are essential, the price history can be highly informative. For most of the prior year, the cryptocurrency was valued at $30k. This lower value results from a bearish trend. However, the largest cryptocurrency still offers a few tricks, as it jumped by approximately 89.7% in just a year.
However, while the currency surpassed its all-time high in March, it had a significant downtrend from there on. Yet, in recent months, it’s possible for the currency to hold a fair fight, maintaining its standing at $50k and up for a while before increasing again.
Notably, whales, or large investors, have recently started accumulating bitcoin again, which can result in a price increase if these tokens are held. These large wallets hold between 1,000 and 10,000 coins. With a limited supply of coins, this significant investment by multiple entities will significantly impact the currency’s future.
Predicting the price of Bitcoin and other cryptocurrencies is the same as gambling; it’s uncertain. With the right factors, the chances increase; with poor factors, there is a significant drop in chance. To make the most of any prediction, you need sufficient crypto literacy. So, what are the predictions for the rest of 2024?
2024 is the fourth year of Bitcoin’s fourth halving, a process that occurs every four years to reduce the supply and make the cryptocurrency more scarce. The process is set to continue until all 21 million coins are mined. Currently, approximately 19.70 million coins are in circulation, and all coins mined are predicted to be acquired by 2140.
A significant breakout is potentially on the horizon, with the currency possibly climbing up to $90k. The $100k mark is a notable area of resistance; if the price rises, it’s likely to hover in the $ 90k for a while before it has a breakthrough. This prediction could come true with the recent climb back up in July.
Though fluctuations can be seen as a given when working with any cryptocurrency, they can scare off even seasoned pros. Take the news with a pinch of salt and trust your gut, no matter your experience level. As miners push forward, sell, and more, these prices are expected to continue to climb, fall, and even stumble.
