Crypto Winter again or not
Bitcoin withdrawals from brokers in very high volume in recent months.
More than ever, users are living up to bitcoin's monetary autonomy and timeless investment concept.
Since its all-time high reached in November 2021, bitcoin (BTC) has lost about 71%. Despite this, investors are withdrawing their bitcoins from exchanges like never before.
According to a recently published report by analyst firm Arcane Research, during the first seven months of 2022, investors withdrew 390,000 BTC units from digital asset exchanges, much more than the number of deposits.
The “crypto winter” and the meltdown of the cryptocurrency market seems not to be a problem, as, to give you an idea, this self-custody movement has never been stronger. In other words, this is the highest withdrawal amount for the year 2022:
in the last three months June, July, August BTC outflows from exchanges amounted to 280 thousand BTC. In June alone, it recorded 119,000 BTC outflows from exchanges.
But all indications, the highlight of June in terms of exits is likely to be the lack of trust in third parties, as many companies ended up holding back withdrawals and recently declared bankruptcy, including giants like 3AC and Celsius.
The preference (or awareness) for self custody follows the motto “not your keys, not your coins” (“not your keys, not your coins”) and the tripod of bitcoin sovereignty: constant purchases, self custody and focus to long term.
Fundamentals startling despair
Bitcoin is decentralized, designed to be deflationary and not controlled by entities or governments. And, despite the price volatility, the bitcoin (blockchain) network, with 13 years of uninterrupted history of operating 24/7, remains intact, without hacks or data leaks.
No wonder, a report made by the company Blockware Intelligence showed that, in the next 14 years — until 2036 — the currency will be used by about 50% of the global population, being 10% worldwide, until 2030.
The scarcity and pristine nature of “digital gold” as collateral may well be coming back to the fore once again, as the amount of bitcoins accumulating each day is far greater than the amount of new BTC being created.
If the historical trend repeats, we should see the price of bitcoin follow an increase in the number of long-term buyers — and users who are withdrawing BTCs in bulk from exchanges are aware of this.
Patience: the asset of success
The key
Being a bitcoin holder has proven to be one of the best investment strategies. After all, historically, all those who bought the cryptocurrency and held it for at least 4 years never lost money.
Looking coldly, the drop in bitcoin's price since the end of 2021 is just a move that unites the desperation of novice investors and short-term traders in the currency.
The down times are the best for accumulating bitcoin, especially with small monthly contributions to the strategy dubbed DCA. Anyway, the recommendation is to keep digital assets off exchanges, having full control over your funds, avoiding confiscations and other problems.
Ethereum has so far proved to have reached a size that is unlikely to be matched by rivals. Given this, the changes planned for the project should only distance it from competitors.
All other initiatives are not even close to what Ethereum already delivers today, within a market that is expanding. He has the opportunity to blow up with steroids once 2.0 is completed
The Second half of crypto winter
the moment of high correlation of Bitcoin and cryptos with the exchanges is an exception, and that soon digital assets will take on a life of their own, reaching a correlation level again attractive to investors. However, a second half of the industry’s “winter” could still see the BTC price pull back sharply.
BTC is already highly discounted considering its mining price, but it is still at risk of falling because investors are still unaware of the cost structure of the digital asset. In a scenario of a new fall, the region that marked the maximum of 2019, close to US$ 14 thousand, would be a possible bottom.
The cryptocurrency is expected to be looking at least the last bottom at $17,500 in the short term, and indeed has a chance of dropping all the way to the $14,000 range.
people are too scared of crypto to understand the opportunities that are on the table.” One of them would be Chainlink (LINK), practically the only player focused on bridging real-world data into the crypto world. Currently trading at $6.48, cryptocurrency LINK is 87% below its all-time high of $52 reached in May 2021.
Now it's a possible Bitcoin bottom, I think the drop will continue until close to $14 or $13K. If not, then there would be a chance of going to the region where historically there was the highest volume of trades.
