Let's talk about an ambiguously overlooked elephant in the crypto room, THE MINERS.
Bitcoin miners hold the most influence over the crypto market, despite the humble spotlight casted on them compared to other players like the exchanges and the ETF distributors.
What people really miss is the fact that miners HAVE to make the most raw profit, there is no ATH, no bull-run, no real surge unless Bitcoin miners make more profit than us!
So let's get right into how Bitcoin miners and the costs involved in the mining process could and has affected the price of Bitcoin during previous cycles.
Based on my research, Bitcoin surprisingly NEVER has dipped below the average mining cost during a bull-run.
During mid April 2021, Bitcoin printed a new ~65000 ATH before starting a correction period that terrified investors. And if you were there back then, you'd remember how this correction was brutal to new traders.
However, after two weeks of shaking the hands, Bitcoin started forming a descending channel week after week, until the price touched the golden FIBONACCI level (61.8%) at ~28600, which happened to be only ~2000 Dollars away from the average mining cost at that time, which was ~26500.
Briefly after, Bitcoin broke out of the descending channel and started surging towards its REAL ATH, ~69000.
Now, you might ask what does that have to do with the current cycle?
Well, you're absolutely right!
This cycle is completely different, because the average cost of mining Bitcoin is at RIDICULOUSLY crazy ~57000 level!
And such extremely high production cost begs for a serious consideration of the validity of ~73000 as a REAL cycle ATH.
Do we really think that the current ATH is making miners enough profit?
I personally don't think so, especially after the price retested the ~57000 level (which happens to be the current average production cost of Bitcoin) days ago and rebounded from it.
It only makes sense to expect Bitcoin to print at least 70% profit for miners who produce Bitcoin at this point in time, especially after the halving event.
And predicting a deeper correction where miners would print LOSSES instead of profit during the BULL MARKET wouldn't be a sensible preposition.
It's extremely important to also mention that during the last cycle, Bitcoin NEVER dropped below its average production cost level until the bear market started.
In fact, dropping below that level might have been one of the most significant causes of the bear market to begin with.
Conclusion:
The bull market is exactly when Bitcoin NEEDS to make miners profit, it's why mining is functional, especially for small mining businesses that can't afford to keep their gear running without cyclic profit.
Bitcoin is currently rebounding from a price matching its current average mining cost after its post-halving correction. And based on the info in this brief research, this level should be where Bitcoin starts surging towards a new ATH.
During previous cycles, miners printed at least 100% profit after the halving events.
Will history repeat itself?
Will the ~57000 price level be the final rebounding level before making a new ATH of at least 100000?
Let's see!
Note: This was an exploration of a potential scenario based on the current context and state of the market, not financial advice.
Bitcoin miners hold the most influence over the crypto market, despite the humble spotlight casted on them compared to other players like the exchanges and the ETF distributors.
What people really miss is the fact that miners HAVE to make the most raw profit, there is no ATH, no bull-run, no real surge unless Bitcoin miners make more profit than us!
So let's get right into how Bitcoin miners and the costs involved in the mining process could and has affected the price of Bitcoin during previous cycles.
Based on my research, Bitcoin surprisingly NEVER has dipped below the average mining cost during a bull-run.
During mid April 2021, Bitcoin printed a new ~65000 ATH before starting a correction period that terrified investors. And if you were there back then, you'd remember how this correction was brutal to new traders.
However, after two weeks of shaking the hands, Bitcoin started forming a descending channel week after week, until the price touched the golden FIBONACCI level (61.8%) at ~28600, which happened to be only ~2000 Dollars away from the average mining cost at that time, which was ~26500.
Briefly after, Bitcoin broke out of the descending channel and started surging towards its REAL ATH, ~69000.
Now, you might ask what does that have to do with the current cycle?
Well, you're absolutely right!
This cycle is completely different, because the average cost of mining Bitcoin is at RIDICULOUSLY crazy ~57000 level!
And such extremely high production cost begs for a serious consideration of the validity of ~73000 as a REAL cycle ATH.
Do we really think that the current ATH is making miners enough profit?
I personally don't think so, especially after the price retested the ~57000 level (which happens to be the current average production cost of Bitcoin) days ago and rebounded from it.
It only makes sense to expect Bitcoin to print at least 70% profit for miners who produce Bitcoin at this point in time, especially after the halving event.
And predicting a deeper correction where miners would print LOSSES instead of profit during the BULL MARKET wouldn't be a sensible preposition.
It's extremely important to also mention that during the last cycle, Bitcoin NEVER dropped below its average production cost level until the bear market started.
In fact, dropping below that level might have been one of the most significant causes of the bear market to begin with.
Conclusion:
The bull market is exactly when Bitcoin NEEDS to make miners profit, it's why mining is functional, especially for small mining businesses that can't afford to keep their gear running without cyclic profit.
Bitcoin is currently rebounding from a price matching its current average mining cost after its post-halving correction. And based on the info in this brief research, this level should be where Bitcoin starts surging towards a new ATH.
During previous cycles, miners printed at least 100% profit after the halving events.
Will history repeat itself?
Will the ~57000 price level be the final rebounding level before making a new ATH of at least 100000?
Let's see!
Note: This was an exploration of a potential scenario based on the current context and state of the market, not financial advice.
Remember, MINERS HAVE TO MAKE SIGNIFICANT PROFITS.
Don't judge Bitcoin's price by how expensive its dollar equivalent price -seemingly- is or by the amount of green candles and bullish waves it goes though, judge it by how costy it is to PRODUCE IT.