Bitcoin Miners’ Downward Difficulty Adjustment in December 2018 Signal a Bear Market’s End?


Has Bitcoin reached its rock bottom yet? This is one of the major points of the crypto-centered discussion recently. Some people argue that Bitcoin has seen its worst days now and that the price is ready to go up. Others believe that there is space for the prices to drop even more before recovery will be a reality.

Now, NewsBTC.com has found out an interesting indicator which the site believes that might explain what will happen in the future of BTC: miners capitulated in December 2018.

The bear was officially a major issue in 2018 when, after months of prices going down, they went below the critical support line and people saw that there was no other explanation: the bear market was here to stay.

Many people saw the price move to below the $6,000 USD mark as very violent because it set many stop-loss orders and people massively sold Bitcoin. Even people who were bullish about the crypto obviously put their stop-loss orders, so they were all triggered at the same time and the crypto apocalypse descended upon us.

All the orders made the prices go down in a very hard way and very fast. Everybody simply took their losses and stopped believing in the future of Bitcoin for a while. This is where we are at now. Several investors are still burned from what happened and are not willing to support Bitcoin anymore while they do not have any reason to believe that the prices will ever go up again once more.

This has also caused another effect: it started to become unprofitable for some miners to actually work. Their equipment was not profitable anymore and they spent so much energy mining that they simply could not make a profit unless the prices went up again.

Because of this, miners were forced to sell off their hardware and look for another job. A recent tweet made by a Twitter profile called PlanB was used by NewsBTC.com in order to explain the Bitcoin miners had already capitulated, though.

Miners are the biggest sellers of BTC as they like to cash in their profits as soon as they mine it, and part of why the prices have seen such a strong swing down was because of them. Now, as they switched off their old hardware, the difficulty of mining has been readjusted.

According to the crypto media outlet, by looking at the charts created by PlanB, we can see how people are often looking at the wrong metrics to determine the future and that this metric could be the key to understand future prices.

Will The Bear Market Really End Soon?

The price of Bitcoin is generally related in some way to miners. As they are the ones who make the network move, it makes sense. Because of this, the miner capitulation may be a sign that the worst is over.

Another important sign seems by the crypto media outlet is that block rewards, which will be halved soon, could also work to make the prices go up again. According to this graph made by Plan B, the Bitcoin prices tend to go up when they are near the halving phase.

The graph shows that the bottom of 2011 bear market was at 12 months from halving while the 2015 bottom was 10 months away from halving. This could signalize that the Bitcoin market is only two or four months away from finally leaving the bear market again.

In the next halving, block rewards will be diminished from 12.5 BTC to 6.25 BTC, which will certainly cause an effect in the network.

The specifics of how good the next bull run will be are debatable, though, as some people will be happy with prices over $20,000 USD again or even $6,000 USD in some cases. Some investors are even eager to say that prices will go over $100,000 USD, but that is very unlikely in the short term. The next months will tell us what will happen.

https://bitcoinexchangeguide.com/todays-coin-price-watch-btc-eth-xrp-and-bch-cryptocurrency-chart-predictions/

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