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Bitcoin will continue to go parabolic through 2021, & it might not stop there...
There have traditionally been 3 stages to a bitcoin market cycle.
1. Parabolic uptrend
2. Large drawdown & market bottom
3. Consolidation before next halving
Each stage takes ~70,000 blocks.
1.
There have traditionally been 3 stages to a bitcoin market cycle.
1. Parabolic uptrend
2. Large drawdown & market bottom
3. Consolidation before next halving
Each stage takes ~70,000 blocks.
1.
Following the halving, new supply issuance is cut by 50%, which puts downwards pressure on inefficient mining operations, who shut down
This purge causes  hash rate to temporarily drop off, leaving only efficient mining operations with cheap power sources &/or next gen ASICs
2.
This purge causes  hash rate to temporarily drop off, leaving only efficient mining operations with cheap power sources &/or next gen ASICs
2.
Remaining mining operations see their competitors ousted, increasing their market share & margins
This dynamic along w/ increasing development, improved  infrastructure & a fresh wave of new adopters, create a massive disequilibrium between available BTC supply versus demand
3.
This dynamic along w/ increasing development, improved  infrastructure & a fresh wave of new adopters, create a massive disequilibrium between available BTC supply versus demand
3.
Following the parabolic advance, miner profitability skyrockets. This incentivizes new miners to enter the market, but there is a lag.
Hash rate continues to come online throughout the cycle, even after a top, squeezing miner profit margins, forcing more coins to be sold.
4.
Hash rate continues to come online throughout the cycle, even after a top, squeezing miner profit margins, forcing more coins to be sold.
4.
An additional reason that a top is set is because new demand effectively runs out, as price has run too far too fast.
This can be seen with the Puell Multiple, which is calculated by dividing daily issuance of new BTC in dollars by the 365-day MA of daily issuance value
5.
This can be seen with the Puell Multiple, which is calculated by dividing daily issuance of new BTC in dollars by the 365-day MA of daily issuance value
5.
What to expect over the rest of 2021?
Expect continued parabolic price action, as new waves of capital flood the bitcoin market.
This is happening as miners have been net accumulating for long spans of time since the halving last may
6.
Expect continued parabolic price action, as new waves of capital flood the bitcoin market.
This is happening as miners have been net accumulating for long spans of time since the halving last may
6.
Price has surged 516% while hash rate has only increased by 33% since the halving.
Many factors including a global semiconductor shortage can be partially attributed.
Miner profitability has surged with the increase of price, increasing margins and sell pressure with it. Â
7.
Many factors including a global semiconductor shortage can be partially attributed.
Miner profitability has surged with the increase of price, increasing margins and sell pressure with it. Â
7.
Will the market face a protracted 80% drawdown towards the end of 2021 like past cycles? Don't be so sure.
The development of bitcoin as collateral in the financial system and a robust future and derivatives market has broad implications.
8.
The development of bitcoin as collateral in the financial system and a robust future and derivatives market has broad implications.
8.
With bitcoin as collateral, long time holders and miners alike have little need (nor interest) to sell bitcoin back for fiat and pay the capital gains that comes along with it.
This changes market structure significantly.
9. https://twitter.com/BTCization/status/1385288660459872259?s=20
This changes market structure significantly.
9. https://twitter.com/BTCization/status/1385288660459872259?s=20
All of the dynamics explained above, along with the incumbent monetary order reaching the conclusion of the long term debt cycle means that this bull run could truly be different...
10.
10.
Buckle up, because bitcoin is going to melt faces, and those expecting a repeat of previous cycles may be in for quite the surprise. 
Check out my full write up with @BitcoinMagazine https://bitcoinmagazine.com/markets/bitcoin-price-will-go-parabolic-in-2021
Check out my full write up with @BitcoinMagazine
https://bitcoinmagazine.com/markets/bitcoin-price-will-go-parabolic-in-2021
