In these uncertain times for the world’s economy, it’s easy to forget how important the role of value of a bitcoin. With the recent economic collapse in the U.S., there’s been a renewed interest in understanding the role of value of a bitcoin and how it applies to your personal financial portfolio. There’s no doubt that one of the things that helped cause the economic slowdown was a lack of investment capital. A lot of people had lost their jobs and those who were able to keep them had cut hours or spent the prior years working even harder. That left little money for investing and short-term investments.
But what does this have to do with the value of a bitcoin? It’s simple really; as we all know, as the price of gold and silver (the only precious metals that haven’t been directly affected by the 2021 crisis) went through the roof, so too did the value of a bitcoins. The value of a bitcoin goes up every time the price of gold and silver goes up. So just imagine what would happen if the price of a bitcoins goes up every single day. This would mean that the role of the value of a bitcoin would be directly proportional to the mining activity of miners all over the world.
So what do I mean by this? Well, the recent trend for certain cryptocoins such as litecoin and dogecoin has been to look towards the intrinsic value of these currencies rather than the price per coin. This was something that was started at the start of the decade with the release of a Coin, but as we’ve seen with the recent burst of the bubble of platinum and gold, it’s always good to diversify and look for different types of assets.
Now this intrinsic value thing is very nice to look at because it means that there will always be an ongoing profit for anybody that is trading in any of these coins. But what I’m interested in is this: how can we make money from something that doesn’t have any physical representation? In other words, how can we take advantage of the fact that most of these cryptosurfs are based on digitally encoded smart contracts (DAC’s)? This is what I’m going to explain in this article.
One way that we can capitalize on the fact that there is no physical commodity that represents the value of a bitcoin is by using a prediction platform. I’ll explain what I mean by this. There are two types of prediction platforms; the long side and short side. On the long side, there are many different prediction platforms out there that you can look at. These include both bullish and bearish sides. They work by comparing the current prices of some big names in the cryptosphere to their average closing prices and then coming up with a prediction as to where the price target should be.
However, the problem with this approach is that it’s all hypothetical and it doesn’t really give you a good indicator of where the current price should be. So we need an indicator that tells us how the price should evolve over time. In this sense, we can make use of what is called a market maker’s algorithm which is based on the fact that most people who trade in the cryptospace are speculators who take positions according to their understanding of how the underlying financial system works.
For example, if you’re speculating about whether the price of a particular currency would hit a certain threshold before it breaks out, you can take a look at the behavior of the market makers and make your move accordingly. What is the reason for that? The answer is that they don’t want you to take a position because if it goes against them they could lose their entire investment. So they take the approach of having a number of transactions come into the market at precisely the right moment and then settle in one place for a while so that there is enough time for their orders to settle. This is what is known as the halving approach and is the basis for most of the volume increase that has been observed in the past years.
So the simple answer to the question posed in the title is that the value of a bitcoin will increase as it approaches what is called a critical point or a break even point. However, the point at which this happens is still somewhat of a mystery to me. That being said, I have been following this technology closely and the patterns that it has created are consistent and quite reliable. When I make a prediction about the future price of this cryptocurrency it is done using a number of technical indicators. One of them is the Fibonacci indicator that you may be familiar with. Others include the MACD, Stochastic, RSI and so on.