The NYDIG team, a monetary and generation corporation committed to Bitcoin, reviewed the quarter of the moment and the occasions that “shaped” it, as well as key occasions for the foreseeable future.
The NYDIG report acknowledges that the 2021 quarter was difficult, as it was the “weakest Q2 of all time and one of its weakest quarters since 2011. “The report adds that it’s vital to put the quarter for now into context, as BTC just finished four consecutive quarters of “stellar” performance.
The company added that even after the quarter of the tough time, Bitcoin is still up more than 19% since the start of the year, making it “one of the most productive acting assets” this year. NYDIG also disputed that headlines ruled the last quarter, which included Tesla’s “sea change,” China’s crackdown, El Salvador’s adoption, Taproot’s activation and many banks and banking partners preparing to allow consumers access to Bitcoin.
As noted in the company’s report, China’s push for mining “has led to sharp drops in grid hash rates and electricity consumption, but the grid continues to function as expected. “long term. “
While this is a noisy move, BTC’s dominance (the largest percentage of cryptocurrencies in the largest virtual asset market) is “up after losing the floor, the previous upswing in the quarter. “With the quarter of the moment now behind us, there is “a lot to look forward to, adding continued adoption across institutions, activating millions of classic banking consumers with the ability to buy bitcoins and basic generation upgrades,” the report adds.
The company also argued that BTC had had a very complicated quarter, “ending the era with a 40. 7% drop. “This makes 2 Q221 “one of bitcoin’s worst-performing quarters since 2011, but also the weakest quarter of all time,” according to the report. revealed at the same time that the quarter of the moment “has historically been an era of strong returns, with only two quarters after the moment showing negative results. returns, reminding us that beyond functionality it prejudges long-term functionality. “
He continued:
“When contextualizing the weak functionality of 2Q21, we believe it is vital for investors to consider bitcoin’s recent functionality. Even though bitcoin was down 40. 7% in the quarter, it had just finished 4 consecutive quarters of solid functionality. of winning quarters, we do not think it is unexpected that investors have used the era to make a profit. “
The additional report noted that even though this is a tricky quarter, BTC is up about 20% since the start of the year, making it “one of the most productive asset categories from 2021 to date” and the functionality is now “more compatible with classic asset categories. “
He adds:
Bitcoin and the ecosystem recorded several positive elements in the quarter. El Salvador has become the first country to settle for bitcoin as a legal payment, the maximum significant generation upgrade in 4 years, Taproot, has been approved through miners and will go into effect in November, and many banks and bank generation providers, adding FIS, Fiserv, NCR and Q2, are running to allow access to bitcoin through classic banking sites. “
The report states:
On the other hand, Tesla’s radical shift in accepting bitcoins as payment, the development of environmental considerations on mining, and China’s crackdown on industry and mining weighed heavily on bitcoin during the quarter. Be smart for bitcoin and the migration of hash power out of China allows the industry to make bitcoin mining greener and more efficient.
The decline in Bitcoin hashrate due to the crackdown on cryptocurrency mining in China has naturally been one of the most discussed topics in the last quarter. With a relief of about 70% since the peak, BTC hashrate has suffered a “severe correction” as China continues to make streathing efforts to prevent cryptocurrency mining in “all primary provinces,” the report notes.
Although it remains to be seen when and with what precision this hashrate will be recovered, the relief of the hashrate has been accompanied by a relief in the overall consumption of electrical energy.
Data from the Cambridge Center for Alternative Finance suggests that electricity intake fell 55% from peaking “from 143. 9 TWh to 64. 7 TWh at the end of June. “Investors deserve to “be reassured because even though the hash rate has fallen, bitcoin is still very secure and adjusting the difficulty every two weeks ensures that blocks continue to occur at normal intervals,” the report adds.
During the last quarter of 2021, NYDIG shows that it won questions about BTC’s “dominance,” its market capitalization as a percentage of the industry’s total market cap.
As noted in the report, dominance tends to be a “noisy signal” as a denominator to the extent that the duration of the industry’s market capitalization “is not solid in terms of number of components,” according to the report.
The report also mentions that the area of cryptocurrencies “is developing secularly and new assets are being created, introduced or existing on a basis. ” According to the company, this makes comparing degrees of dominance between cycles “challenging, but we think there is data to learn about investor cycles and personal tastes of domain substitution. “
As noted in the report, BTC’s dominance had noticed its first “sharp decline in the spring of 2017, amid Ethereum and a sudden overnight retail frenzy for alts (alternative currencies), such as Litecoin and XRP. in mid-2017, when the initial coin supply mania (ICO) peaked and BTC struggled “before the fork of Bitcoin Cash”.
As the NYDIG noted:
“With the fork of Bitcoin Cash, bitcoin rallied at the end of the year, reaching a peak in value in mid-December. Bitcoin’s dominance hit a cyclical low in mid-January 2018 as Ethereum values reached their peak. cyclical almost a month. ” After bitcoin. During the 2018 retreat, bitcoin regained its dominance as alts fell more than bitcoin, demonstrating its threat in a threat-free environment.
He continued:
Bitcoin continues to rebound in 2019, gaining dominance, as assets are up more than 90%, while primary highs like Ethereum end the year lower. Bitcoin’s dominance crosses 70% in early January 2021 amid exceptional 2020 functionality. 40% for the first time in the cycle, as the value consolidates while the alts recover. Bitcoin regains its dominance during the market correction in May and June. »
Now that the quarter of the tough time is even though everything is behind us, NYDIG is a must to anticipate some of the occasions when they will help shape the “months and quarters to come. “
On July 21, 2021, Elon Musk and Jack Dorsey are expected to have “the convention” at The B Word convention to be held through the Council for Crypto Innovation, Ark Invest, Square and vc Paradigm.
As stated through NYDIG:
“Presumably, ‘the talk’ focuses on Bitcoin’s power consumption, a factor Musk has spread online and the main explanation for why Tesla has stopped accepting bitcoins as payment. Taproot, Bitcoin’s maximum vital technical update since 2017, will be enabled on block 709,632 in mid-November.
The company added that the growing adoption of BTC as a monetary asset through institutional investors “continues, with names of new big-name investors in the news regularly. “
Many new Bitcoin ETF programs “continue to operate in accordance with the SEC process,” the report confirmed. The activation of “millions of potential bitcoin consumers through classic banks and monetary establishments is underway thanks to the efforts of our organization and our banking and generation. “partners,” the report adds.
NYDIG also noted that “the case for the expansion of secular assets has never been clearer. “