2021W26 - WTF has happened in bitcoin this week?
Bitcoin is true charity
TLDR: Bitcoin Mining Council release energy consumption numbers, 3rd Richest man in Mexico advocates for Bitcoin, Miners are investing in accumulating more hashrate, Whales start accumulating again.
Hey there niblings, it’s uncle Bam again, with a summary of the most insightful events in the Bitcoin space. Back at it again digesting all the important news for you.
So this week has been an interesting one, the main news one was finding out there was: “The Hash Rate Is Gone”! The price stagnated the entire week below $35,000 until today. There was, maybe still is, fear in the street and everybody was talking about the upcoming, now past, difficulty adjustment of the network, which ended up decreasing close to 30%. What does this mean and how did it happen? The reason is simple, the bitcoin network is programmed to issue new blocks approximately every 10 minutes. When more miners join the network or leave the network, the difficulty adjusts, this event happens every ~2 weeks.
Is this bullish or is this bearish? Well, China kicked out miners from the country, a large percentage of the bitcoin hash rate was turned off in less than a week, and bitcoin continues to issue new blocks and store the value of millions of individuals.
To me, it shows that the bitcoin network is resilient and it is ready to resist a state attack. “What doesn’t kill you makes you stronger”.
As usual, the week was filled with great and interesting news, only to be shadowed by fear of the hash rate. But not to worry niblings, uncle Bam is here to spotlight the good events in case you missed them.
And this is how the week started.
0. Based on the Bitcoin Mining Council survey of the network, mining electricity mix increased to 56% sustainable in Q2 2021, making Bitcoin one of the cleanest industries in the world. - “Michael Saylor”
1. Ricardo Salinas Pliego, billionaire and the third richest man in Mexico, openly expressed his support for bitcoin, and his intention to adopt the technology and making Banco Azteca the first mexican bank to receive bitcoin.
“Bitcoin is an asset that should be part of every investor’s portfolio” - Ricardo Salinas.
2. In India, investments in crypto grew from about $923 million in April 2020 to nearly $6.6 billion in May of this year, according to Chainalysis.
3. Coinbase has received approval from Germany, the 4th country with the highest GDP, to enter the custody business with Bitcoin and crypto.
4. Nayib Bukele, the president of El Salvador, made a thread explaining miss-information about the Bitcoin Law, where he stated the following points:
Bitcoin awarded to the citizens ($30) is free to spend.
The new government wallet ‘chivo’ is interoperable with any other bitcoin wallet, it will be free, and will have no fees for sending or receiving payments or remittance, or even to exchange from bitcoin to dollars or the other way around.
Chivo will operate without the need of an internet plan.
5. Hut 8, canadian crypto mining firm said it plans to increase its self-mined Bitcoin holdings to 5,000 by the end of 2021.
The firm currently has about 3,806 Bitcoin, roughly $134 million, on its balance sheet. This is an increase from the 3,271 it had at the end of March.
6. Cathie Wood’s Ark Invest filed for a Bitcoin ETF in partnership with 21Shares.
“The ETF’s investment objective is to track the performance of bitcoin, according to the SEC filing.”
7. The San Francisco Deputy Sheriff’s Association added bitcoin in their investment portfolio. They are apparently the second department, behind the Fairfax County Police Pension Fund, to gain exposure to bitcoin.
8. Argo Blockchain, a bitcoin mining company, has borrowed $20 million against its Bitcoin holdings to build its West Texas mining operation.
9. North American bitcoin mining company, Blockware Mining, has raised more than $25 million and plans to triple its hash rate, reaching more than 1 EH/s, by mid-2022.
10. Bitmain, announced today a signed purchase order of 30,000 units of its latest-generation Antminer S19j Pro mining rigs from bitcoin mining company TeraWulf.
TeraWulf expects to increase its total mining hash rate capacity by 3 exahashes per second (EH/s). (Estimated time of delivery and deployment July 2022)
11. Soros Fund Management, the family investment firm managed by billionaire George Soros has been given the green light to trade Bitcoin.
12. AZ Alkmaar, has become the first Netherlands professional football club to hold bitcoin on its balance sheet.
FUNDAMENTALS
Whales are ramping up their accumulation again. The move was sudden and strong, this is comparable to October 2020, but in a more abrupt manner. Now before we all get jumpy jumpy, let’s remember this is an optimistic metric, supply is drying up, which generates a price appreciation, but there is no guarantee of what they could do next. So the strategy that will always be recommended here is to just keep stacking.
As a summary note..
Dollar Cost Average (DCA), is the ultimate way of charity, while living in a world where a great part of the population is living under poverty conditions, bitcoin fixes this. Bitcoin is the only system I’ve encountered where my greed benefits the well being of the entire network. A great currency is not the one which fluctuates up and down every single day, a great currency is the one which is stable and allows you to be used as a medium of exchange. A better currency, is the one which only goes up in value. Bitcoin is on its path to reach a stage which only goes up in value, but how? Through DCA.
I think the idea is simple, at the moment bitcoin is growing, which means it will be volatile. Through its appreciation’s path, we will be experiencing up and downs. But if every individual who believes in bitcoin decided to transfer a fixed amount of its wealth into Bitcoin on a daily basis, as the number of holders grow, the base amount of purchased bitcoins would easily outpace its supply, the DCA-bitcoiners would be consuming all the availability, the bitcoins from the Whales, Traders and Speculators.
The tidal wave could make bitcoin have a constant appreciation instead of a wild swinging one, where every individual of the network would be benefiting and creating a richer and prosperous life for themselves and the people who surround them, becoming the ultimate wealth transfer, or true charity.
Anyway nibs, I leave you with this thoughtful moment of uncle Bam, inspired by listening to the Stephans Livera Podcast with Friar Hass.
Have a great weekend niblings.
Stay humble & stack sats.
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