As a seasoned crypto investor with a decade of market experience under my belt, I’ve learned to navigate the turbulent seas of digital currency trading with a steady hand and a level head. The recent price decline of Bitcoin, following the disappointing August NFP data release, is nothing new in this rollercoaster ride we call crypto investing. However, it’s always a reminder that patience and a long-term perspective are crucial in this game.
Over the weekend, Bitcoin‘s price showed notable declines after the unveiling of August’s Nonfarm Payrolls (NFP) figures, which came in lower than forecasted by financial analysts.
After the publication of NFP figures, Bitcoin experienced a significant drop of approximately 5%, falling below the $54,000 threshold – its lowest point since early August. In the midst of this price fluctuation, the crypto market witnessed a liquidation of about $200 million in long positions. This downturn in Bitcoin’s value also affected other sectors, causing meme coins and AI-related cryptos to decrease by 6% and 7%, respectively.
Short-Term Focus
Despite the ongoing price drop caused by broader economic issues, analysts from Presto Research have pointed out that Bitcoin seems to be underestimated in its current market value. Specifically, analysts Peter Chung and Min Jung argue that Bitcoin’s current price is significantly lower than it should be, emphasizing the crucial aspect of “network security” as a primary factor justifying this assessment.
In a recent report on September 9th, they highlighted inconsistencies between Bitcoin’s (BTC) current market price and its intrinsic worth. The market price, the focus of investors at present, fluctuates wildly and in the short term, whereas its value, alternatively, is relatively stable and tends to change gradually over time.
According to recent findings, Bitcoin’s processing power (hashrate) peaked at an unprecedented level of 679 exahashes per second (EH/s). This indicates that the network has never been more secure. However, analysts argue that the market appears to be underestimating this crucial aspect of the asset, as demonstrated by the current low price for this security measure—which is at a record low.
Recent discussions about Bitcoin’s price have primarily focused on large-scale factors, but a critical underlying aspect that supports its value – network security – is being overlooked. The hashrate, which represents the network’s computational power, has reached an unprecedented high of 679 EH/s, making it the most secure network globally. However, the market seems unaware of this, as indicated by the record-low hash price of $39.01/PH/s/day according to a recent report.
Long-Term Value
In summary, the expert found that temporary decreases in Bitcoin’s price may occur, but they advise investors to pay closer attention to its lasting worth. This enduring value is supported by the robust security of the network and the increasing recognition of Bitcoin as a form of “digital gold.
Over the past fifteen years, the global community has gradually adopted the idea of ‘digital gold’. If you think this trend will persist – indeed, with the introduction of spot ETFs, we find ourselves in a more advantageous position than ever – then it appears that Bitcoin is currently significantly underpriced.
Currently, Bitcoin trades over $55,000 now, representing a minor increase of nearly 2% for the day. The cryptocurrency may experience more fluctuations in value as we approach the release of the Consumer Price Index (CPI) figures on Wednesday and Producer Price Index (PPI) data on Thursday.
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2024-09-09 18:08