Entering text into the input field will update the search result below

Bitcoin Difficulty – Personal Notes To Self. (Just Rough Ideas On Paper To Help Me Think)

Jan. 16, 2015 3:26 PM ET
Catallaxy profile picture
Catallaxy's Blog
5 Followers
Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

Bitcoin computational speed (Network Hash rate) has reached a beginning of a "roll-over" or a Plateau. (See chart below and hyperlink below that)

Feedback welcomed ... just early surmisings here ... thinking on paper.

Must see Graphs: http://bitcoin.sipa.be/

1. The current degree of difficulty that supports the release or "coining" of new Bitcoin Moneys has reached a place where the competition for the 3600 daily Bitcoins coming into the market is in a rollover pattern likely doe to the lower price.

2. This is likely directly related to the drastic price reduction of Bitcoins. (A cost of production versus reward/return issue)

3. The Winklevoss ETF has yet to become official; however if it is officially adopted it stands to markedly increase Bitcoins global exposure and possible demand.

4. The "coined" supply of Bitcoins regardless of price or Global speculation will be cut in Half @ETA: 2016-07-30 11:31:49 UTC due to the design of the Block Structure built into Bitcoin.

5. Practical daily usage for Bitcoin for the masses is a substantial ways off; however there appears no slowing of development and money flow into global cloud infrastructure for its adoption within global technology demand and commerce potential.

Conclusions: (Again my personal notes to self … very rough ideas.)

1. Bitcoin today is simply a speculative instrument of value positioned strictly by supply and demand.

2. A price bottom appears to be forming and coin liquidity increase (Inflation) seems to be slowing.

3. IF no ETF then a further drop is likely.

4. IF yes ETF then a defined bottom is likely.

5. Between now and July 2016 barring other variables and all things being equal; Bitcoin should rise in price with substantial volatility simply based on the current supply and demand dynamics.

6. IF yes greater adoption and exposure THEN far greater upward volatility and spikes paralleled with far more mining activity. (The time around Jul 2016 being a predictable market spike)

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You