Bitcoin’s Unbreakable Floor? Analyst Predicts BTC Won’t Fall Below $35,000 Ever Again
November 28 2023 - 7:00PM
NEWSBTC
Controversial Stock-to-Flow (S2F) model creator PlanB has recently
made a bold prediction about Bitcoin (BTC) that’s captured the
crypto community’s attention. Via his social media handle X, PlanB
stated that Bitcoin’s price would never plummet below the $35,000
threshold again. PlanB supported his claim with a chart
illustrating Bitcoin’s valuation trend about its intrinsic hash
rate. According to PlanB, this relationship is a critical indicator
of the digital currency’s enduring value. Related Reading: Bitcoin
Defies Global Market Trends: Negative Correlation Hits Pre-Pandemic
Levels Despite acknowledging potential black swan events or
short-term market volatility, PlanB insists that based on the
current fundamentals, particularly the cost of electricity ($/kWh)
used in mining Bitcoin, the asset’s market value is “unlikely” to
retract below the mentioned support level – $35,000. Mining And
Market Arbitrage: A Key Factor The crux of PlanB’s argument lies in
the unique arbitrage opportunity that exists between Bitcoin miners
and everyday users. Miners, who invest heavily in electricity to
mine the digital asset, and users, who typically purchase Bitcoin
with fiat currency on exchanges, create a dynamic market
environment. According to PlanB, this arbitrage might become even
more pronounced with the advent of a potential launch of a spot
Bitcoin Exchange-Traded Fund (ETF) in the US. 🚨BREAKING: Bitcoin
valuation based on difficulty (hashrate) increased to $35k
yesterday. IMO this could mean that, apart from possible black
swans or short term volatility, based on $/kWh-arbitrage
fundamentals … BTC will never go below $35k ever again.
pic.twitter.com/JPLkXieQAP — PlanB (@100trillionUSD) November 27,
2023 PlanB suggests that miners, equipped with specialized
knowledge about the market and the actual cost of producing
Bitcoin, might begin to demand a premium when selling the
cryptocurrency. This shift could fundamentally alter the way
Bitcoin is traded and its perceived value. The introduction of BTC
spot ETFs, in particular, is expected to bring a new level of
mainstream acceptance and investment into Bitcoin, potentially
solidifying its price floor as predicted by PlanB. Bitcoin Hash
Rate And Market Dynamics Delving deeper into the concept of
Bitcoin’s hash rate, it’s essential to understand its role in
securing the network and validating transactions. The hash rate
basically measures the computational power being used to mine and
process transactions on the blockchain. A higher hash rate
indicates more robust security and efficiency in the network, often
correlating with increased investor confidence and, consequently, a
higher asset valuation. Related Reading: Bitcoin Bull Run Is Only
Just Starting, According To This Metric PlanB’s analysis posits
that Bitcoin’s valuation will follow suit as the hash rate
continues to rise, driven by technological advancements and
increased mining activities. This relationship forms the basis of
his prediction that Bitcoin will maintain a strong market position,
unlikely to fall below the $35,000 mark. Currently, BTC is trading
above $37,000, marking an increase of over $2,000 from the support
level PlanB mentioned. Specifically, at the time of writing,
Bitcoin’s price stands at $37,605, reflecting a 2% rise in the last
24 hours. Featured image from Unsplash, Chart from TradingView
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