IN THE NEWS DURING DECEMBER:
DECEMBER
Rather like November, The Crypto Markets diverged from the 4 year cyclical Q4 Push. This deviation from the Cycle and the Stock-to-Flow Model has meant that there has been a large number of interpretations and commentaries on where the market will go in 2022.
A number of factors contributed to this diversion
● Covid, and the new Omicron created huge uncertainty.
● The Coinbase Exchange Technical Blip, which although fixed, revealed some fragility in the Market, and left many Wall Street Bitcoin derivatives traders on the wrong side of massive leveraged longs and a panic sell off followed.
● Year End Tax Returns, with the associated draw-downs.
● Markets quietened with Holiday Season, and we saw The Crypto Market Cap dropping from its All Time High of $1 Trillion.
JANUARY 2022
● January 3 marks the 13th Anniversary of the day Satoshi Nakamoto mined the first Bitcoin block.
● With the four year cycle broken, it appears Institutional Investors are taking the space into a new mature phase.
● Already this month, Bitcoin’s Hash Rate has hit an All Time High marking a recovery since Bitcoin miners were forced out of mainland China.
THE YEAR AHEAD
The Bitcoin Network looks bulletproof. 2021 saw the biggest attack by a Nation State as China banned Bitcoin Mining. Given the country was home to around 50% of all mining, we can already see that the Hash Rate is back to where it was pre ban.
The resilience of The Bitcoin Network cannot be understated, and this is an incredibly positive new piece of information for the entire Crypto/Blockchain Space.
From a Global Investors point of view, holding the underlying asset of Bitcoin (not to mention other strong Alts) looks a “must” for any Portfolio.
We have spent the last two months building new indicators that will track a wider array of digital financial assets.