Traders are looking at some sort of triangles and they’re saying this might be some sort of a bullish divergence.
Others speak of a double bottom, an indicator that the bear is maybe thinking of taking his bags and leaving, though ever so slowly.
These esoteric in the far flung corners of crypto are joined by even more subjective romanticism in some suggesting the Christmas of the first bear year is usually the best time to buy.
The AlphaTrAI Core Crypto Strategy Fund is buying, though just $250,000 from one investor.
SEC disclosures also reveal the Weisenborn Crypto Fund also bought $500,000, this too from just one investor.
Small sums, but better than the usual none with bitcoin for the first time being in the negative over a five year period.
Its price was higher in 2017, albeit very briefly, than currently. Accounting for inflation, if you held so long… well, hold some more.
Because the comparison is not too fair. The peak of extreme hype and now a seemingly very stable floor are too very different things.
Instead, what might be a bit more fair is judging all these charts and models to see what stood.
Stock to Flow may be out for some. We wouldn’t discard it, but the rainbow chart is sort of out too, although we wouldn’t discard that either.
For the latter, because it is about a range, and for the former, because it is about direction, but something may have been revealed by this bull bear cycle.
Cyrus de la Rubia, the Chief Economist of the Hamburg Commercial Bank, came with an energy model of pricing bitcoin’s upper range.
He concluded last year that bitcoin can not consume more than 2% of global electricity because beyond that it would receive huge pushback.
Based on that assumption, the calculations then become somewhat simple with Rubia stating bitcoin had a ceiling of $100,000 for this cycle.
Whether he was right, or was made right, is naturally unknown until we go through some more cycles, but bitcoin didn’t crack $100,000 even in extreme hype.
The energy model is a moving model, however, not a fixed number. That’s both because energy production can increase, and because fiat has inbuilt inflation.
So bitcoin will reach $1 million by 2030 according to this model. Or more correctly, one million would be the ceiling.
Which means this cycle, if it comes, we have room for $200,000, or about 10x from here, in about two or three years.
Is it for real? Well, the future is unknown, but the qualities of bitcoin and crypto more widely are very well known.
At this stage, crypto is more a sort of backup. That’s the role gold used to play and gold will always have a role as a decorative even when we get to our neighboring galaxy, but gold does not realistically have a role any longer as a sort of backup function.
Central Banks still hoard it, as do governments like Russia, but gold can not be used digitally and therefore it is of no use to the public or to commerce.
Bitcoin is. Not as a primary means of payment, although some do actually live on bitcoin only, but as an alternative.
For example, the American Express credit card for some reason does not work in India when making international payments. Bitcoin of course works.
We learned of this due to our own subscriptions with some unable to pay from there, and so they use crypto.
That was a revelation to us in some ways that people do actually use crypto for payments for things like subscriptions to Trustnodes.
We have connected it to MetaMask, so it might be even more convenient instead of adding all those card numbers, but this backup theory especially applies in the developing world where debit cards may have quirks.
In Albania for example, a European Candidate country and probably very representative of the developing world, the local debit card can not always pay for transactions that are in euro, usd or gbp.
Instead you have to open a euro account, in addition to lek, the local currency, and they each have a yearly charge of circa $30, or $60 in combination.
That’s a lot of money in a country where wages are $250. So in a situation where you can’t make a card payment to say book a flight, there’s Alternative Airlines that accepts crypto, and you’re good to go.
The interesting thing for someone that does have crypto – especially eth with MetaMask – is that such crypto payments are extremely convenient and fast, especially during the bear when fees are practically nil.
It’s a revelation in many ways, even to us that have been covering crypto for many many years, that people both do pay in crypto and that paying in crypto actually works and is very convenient. Something we have known of course, but experiencing it is different and makes this whole crypto thing a bit real.
This base commerce, in our theory, is what sets the floor of bitcoin’s price, the circa now six months long sidewayish move that we have seen in bitcoin.
This base naturally has been growing through the cycles and does have a lot of room to grow from a global perspective, shown by the fact there are still many knee-jerk ‘haters’ or ‘disbelievers.’
It also has plenty of room to grow simply because it is too new for people to know its use cases, which really for bitcoin – or now eth due to its browser extensions – when it comes to utility is as an alternative digital global payment method.
From that derives its store of value, as well as the 21 million limit, or it’s vice versa that people buy it first and then occasionally use it.
As long as this base is growing, which it is currently, then bitcoin may eventually gravitate towards the ceiling of the energy model, $200,000, and oscillate as dying out hype gives way to that base price.
Therefore, if one is of the view that the bull will eventually come, now is very much the very best of times to buy.
Not necessarily in a hurry. We may have another four months at the depths, but at the great gathering on Christmas day it may be that a lot of the gifts are in crypto or the gifted fiat is turned into it.
That is to say that at some point, if one is of the view crypto will bull, we will leave this range to perhaps not see it again either never or in a long time.
No one can be sure when that might happen, or indeed whether it will, but chances increase the longer time passes from now.
We’re through November, usually the worst month during bear and the best during bull, so from an esoterics perspective, it’s buy time and it is one of those times when one can tell others with some comfort that it is the best of times to buy, but it is their business whether they should.