Right now, Bitcoin (BTC) goes for in around $8200 apiece and currently trades for a market capitalization (at this price) of around $139 billion. Much time has been spent over the last six weeks or so trying to figure out where price will eventually bottom out and, subsequently to, turnaround to resume its overarching upside momentum.
Much of this analysis and time has been spent focusing on previous price levels as relates to things like moving averages as well as volume metrics.
There’s another key metric on which we can focus, however, that might be more accurate as far as allowing markets to ascertain exactly where things stand in the bitcoin price right now – market capitalization.
The thing with market capitalization in the space is that it doesn’t represent what it represents in the space for which the term was coined, the equities markets. This is something that many people overlook or ignore outright when evaluating coins. Ripple (XRP), for example, is priced at around $0.77, just a tiny fraction of bitcoin’s price, but its market capitalization puts it as the third-largest currency on the market.
There is a degree of similarity between the equities markets and the cryptocurrency space in that a larger total supply will generally result in a reduced price (analogous to a company issuing more shares and its share price reducing accordingly) but that’s about why things end, especially when you take into consideration that the token market capitalization is measured against fiat.
Anyway, the point where trying to make is that with the vast majority of coins, market capitalization isn’t a reliable metric. With bitcoin, however, it is. The fixed supply combined with the ever-increasing difficulty associated with bitcoin mining (in other words, the restricted rate of new coins entering the market) creates a situation in which market capitalization can be a major indication of strength or weakness.
In turn, we can look at historic key market capitalization levels as similar in implications to historic key price levels.
And we’ve got one in and around current pricing.
As mentioned, right now, bitcoin trades for a market capitalization of a little over $139 billion. $100 billion flat is a major psychological key level from a market capitalization perspective and it’s one that initially broke back in October, when price traded in around $6000. Subsequent to the break, the bitcoin price ran to around $7000 before dipping to retest the $100 billion market capitalization level. The retest proved strong (to a degree, at least, price broke below it for a single day before resuming its uptrend) suggesting that this is a major support level in markets right now.
Fast forward to February 6, and the bitcoin price fell to $6300, representing a market capitalization of $106 billion. From here, and as mentioned, it has since appreciated to current levels.
The assumption is, then, that this retest of $100 billion market capitalization as support, and importantly, this successful retest of this level, indicates that we could finally have seen the turning point for the markets and, in turn, that we should see a continued appreciation from here on out as markets recover towards the $10,000 mark and beyond.
Nothing is confirmed, of course, and if we fall once again to the $100 billion level, it will again become a key level to keep an eye on as indicative of near-term action, but as far as technical indicators go, this one looks sound.
Let’s see what happens.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency.
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Currently, China is leading in Bitcoin mining industry by far, second to none for bitcoin mining power. Literally, it’s contributing over 70% of the network’s hash rate (a term that is used in describing the total processing power of a blockchain network). But how Ripple fits in here and what it has to do with that? We’ll talk about that a bit later below, let’s cover some in-depth facts about China’s dominance over Bitcoin first.
It’s a near-complete dominance by China on the BTC mining grid that has made it responsible for mining a majority of circulating bitcoins. A Beijing-based company, Bitmain Technologies, is highly responsible for extracting the significant part – more than half of the globe’s bitcoin, and alone, it has approached 50% of the total hash rate more than once.
The fact that China is controlling a majority of Bitcoin hash rate, clearly tells that it has the power of manipulating or merely destroy the bitcoin network if it gets enough support should it decide to take such a move. Therefore, this has led to serious concerns among countries including the US that China might get an edge in this cryptocurrency industry and possibly becoming a potential threat.
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There is no doubt that Bitcoin is the most significant and largest success story in the cryptocurrency sphere despite the volatilities the powerful digital coin has been experiencing this year. 2018 has been a rough year for major cryptocurrencies including Bitcoin that has seen the prices of the virtual currency depreciate from a high of 20,000 US dollars in January 2018, to a low of 6,400 US dollars in October 2018.
Regardless of not much powerful performance, Bitcoin still maintains being the most sought-after virtual currency in the market. In totality, Bitcoin had a price appreciation of about 150,000 percent from its listing in July 2010 to the present day.
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In its lifetime so far, the number one ranked cryptocurrency has had its fair share of mixed bear runs, and bull runs throughout the years with the longest bear run being experienced in March 2014 and March 2015. However, in its history of up and down price progression throughout the years, gains have outweighed losses and Bitcoin has managed to record impressive highs of 20,000 US dollars as at December 2017.
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The state of the market has seen the price of Bitcoin go up by 0.7% to the $6,537 lifting its market cap to $113.2 billion. Bitcoin cash has stayed stable too at $466 representing a slight drop of 0.56% and the market cap being $7.7 billion.
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