The Correlation Between ASIC Miner Prices and Bitcoin
Adam Back, the co-founder and CEO of Blockstream, has highlighted a significant correlation between the prices of ASIC miners and Bitcoin. This trend has been consistent historically, with miner prices peaking during the 2021 Bitcoin bull run. Back suggests that the price of ASIC miners is not solely determined by manufacturing costs or technological advancements, but also reflects market sentiment towards Bitcoin.
The Miners’ Market: A Reflection Of Bitcoin’s Value
During the lead-up to the 2021 bull market, the price of ASIC miners was low, reflecting the anticipation and optimism within the Bitcoin community. However, as Bitcoin’s value surged, so did the price of these mining machines. They reached a peak of $120/Terrahash (TH) alongside Bitcoin’s all-time high. As BTC value declined, demand and prices for ASIC miners dropped significantly, currently trading at under $15/TH.
Despite a positive momentum for Bitcoin this year, ASIC miner prices have remained subdued. However, Back remains optimistic about a potential resurgence in ASIC miner prices.
Potential Catalysts for Price Surge
Back suggests that as Bitcoin enters a deeper bull phase, the value of ASIC miners is likely to increase. He points to the upcoming Bitcoin Halving as a possible catalyst for both Bitcoin’s price surge and a parallel rise in ASIC miner values. The Halving reduces the rate at which new Bitcoins are generated and historically impacts Bitcoin’s price.
Bitcoin Path To Reclaim $35,000
Bitcoin has been moving at its own pace despite various predictions and analyses. After retracing from $35,000, it has begun to thrive towards reclaiming that price zone.
Currently trading at $34,269, down 1.1% in the past 24 hours, Bitcoin still shows gains on a weekly basis. It has dropped by 0.7% in the past seven days but remains up by 20% in the past two weeks.
Back considers the Bitcoin Halving as a significant milestone that could precede a notable increase in Bitcoin’s price, typically starting around six months post-halving.
Hot Take: Bitcoin’s Promising Outlook
While Back refrains from making a definite prediction about the exact outcome this time, he maintains optimism about Bitcoin’s prospects. He believes that the cryptocurrency could continue to grow further throughout this year and next year.
Featured image from Unsplash, Chart from TradingView
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