{"id":23735,"date":"2023-10-16T09:37:09","date_gmt":"2023-10-16T09:37:09","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/mining-btc-is-harder-than-ever-5-things-to-know-in-bitcoin-this-week\/"},"modified":"2023-10-16T09:37:12","modified_gmt":"2023-10-16T09:37:12","slug":"mining-btc-is-harder-than-ever-5-things-to-know-in-bitcoin-this-week","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/mining-btc-is-harder-than-ever-5-things-to-know-in-bitcoin-this-week\/","title":{"rendered":"Mining BTC is harder than ever \u2014 5 things to know in Bitcoin this week"},"content":{"rendered":"
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Bitcoin (BTC) starts a new week firmly back in the \u201cUptober\u201d spirit as the weekly close gives way to a classic short squeeze.<\/p>\n

In a return to classic BTC price volatility of the kind seen earlier in the month, the largest cryptocurrency is tackling $28,000 ahead of the first Wall Street open.<\/p>\n

While still in an established trading range, Bitcoin is keeping traders on their toes, with both longs and shorts getting caught out by short-term spot price moves, and liquidations are mounting.<\/p>\n

Sentiment is fluctuating in step with these moves. Heading toward the top of the range, Bitcoin sees a flurry of bullish projections, with these replaced by fear and foreboding when the downside reenters. <\/p>\n

Well-known market commentators thus remain cautious, even as October \u2014 traditionally Bitcoin\u2019s best-performing month \u2014 plays out.<\/p>\n

Behind the scenes, the signs are solid \u2014 network fundamentals are headed to new all-time highs, and difficulty is due what could be its third-largest hike of 2023.<\/p>\n

With macroeconomic data giving way to a focus on geopolitical tensions in the Middle East this week, there is plenty for Bitcoin investors to keep an eye on when it comes to external sources of BTC price volatility.<\/p>\n

Cointelegraph takes a closer look at these market phenomena and more in Cointelegraph Markets\u2019 weekly rundown of BTC price triggers waiting in the wings.<\/p>\n

BTC price: Short squeezes and \u201cold\u201d coins<\/h2>\n

Weekly close volatility on Bitcoin did not disappoint this week, with one short squeeze following another to see BTC\/USD add $1,000, data from Cointelegraph Markets Pro and TradingView confirmed.<\/p>\n

BTC\/USD 1-hour chart. Source: TradingView<\/em><\/figcaption><\/figure>\n

The climate headed into the first Wall Street open is decidedly different from that over the weekend and before, where the downside characterized the landscape amid problematic macroeconomic reports from the United States.<\/p>\n

Now, optimism is returning, with Micha\u00ebl van de Poppe, founder and CEO of MN Trading, calling the trip to multiday highs of $27,975 a \u201cgreat move.\u201d<\/p>\n

\u201cDips are for buying, most optimal entry would be $27,300,\u201d he told<\/a> X (formerly Twitter) subscribers in part of the day\u2019s commentary.<\/p>\n

Van de Poppe further predicted<\/a>\u00a0the continuation of the uptrend.<\/p>\n

BTC\/USD annotated chart. Source: Micha\u00ebl van de Poppe\/X<\/em><\/figcaption><\/figure>\n

Covering the impetus behind the latest action, monitoring resource CoinGlass noted liquidations among short BTC positions.<\/p>\n

\u201cAt 27450, a large number of shorts have been liquidated,\u201d it concluded<\/a> alongside a liquidation heatmap for BTC\/USDT perpetual swaps on the largest global exchange, Binance. <\/p>\n

\u201cNext focus on the liquidation levels of 26500 and 27660.\u201d<\/p><\/blockquote>\n

BTC\/USDT liquidation heatmap. Source: CoinGlass\/X<\/em><\/figcaption><\/figure>\n

Popular trader Crypto Tony was more cautious, having previously warned of the potential for significant downside pressure taking Bitcoin all the way back to $20,000 in the coming months.<\/p>\n

\n

$BTC<\/a> \/ $USD<\/a> – Update <\/p>\n

Stopped out as we reclaimed the $27,300 resistance zone, and now just sat waiting for my next trigger. The bulls could very well take us up to $29,000 resistance zone, but remember this is a heavy area <\/p>\n

If you are longing now just be cautious pic.twitter.com\/aQGF1ZVJuL<\/a><\/p>\n

\u2014 Crypto Tony (@CryptoTony__) October 16, 2023<\/a><\/p><\/blockquote>\n

For research firm Santiment, meanwhile, there was more to the change of tone than merely short squeezes.<\/p>\n

\u201cOlder\u201d BTC was on the move, it showed, having left wallets after an extended period of dormancy immediately before the return to $27,000.<\/p>\n

\u201cThe largest amount of dormant $BTC changing wallets since July, these spikes in our Age Consumed metric indicate price direction reversals,\u201d part of accompanying comments on an illustrative chart stated<\/a>.<\/p>\n

BTC\/USD annotated chart. Source: Santiment\/X<\/em><\/figcaption><\/figure>\n

Dalio warns over 50\/50 outcome of \u201cWorld War III\u201d<\/h2>\n

In contrast to last week, the macro landscape in the coming days contains less by way of significant data prints from the United States.<\/p>\n

Instead, nerves over the potential market impact from the ongoing Israel-Hamas conflict are taking center stage while the specter of inflation lingers in the background.<\/p>\n

The latter was previously all too clear, as successive data releases last week and before showed U.S. inflation persisting beyond market expectations.<\/p>\n

The Federal Reserve\u2019s next meeting to set interest rates is due on Nov. 1, and with two weeks remaining, inflation cues will be all too important for risk asset sentiment.<\/p>\n

\u201c2 weeks until the November Fed meeting,\u201d financial commentary resource The Kobeissi Letter summarized on X while shortlisting the week\u2019s main U.S. financial events.<\/p>\n

These include a speech from Fed Chair Jerome Powell, one of 17 Fed speakers due to take to the stage this week.<\/p>\n

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Key Events This Week:<\/p>\n

1. Retail Sales data – Tuesday<\/p>\n

2. Housing Starts data – Wednesday<\/p>\n

3. Existing Home Sales data – Thursday<\/p>\n

4. Fed Chair Powell Speaks – Thursday<\/p>\n

5. Q3 2023 earnings season begins<\/p>\n

6. Total of 17 Fed speaker events<\/p>\n

2 weeks until the November Fed meeting.<\/p>\n

\u2014 The Kobeissi Letter (@KobeissiLetter) October 15, 2023<\/a><\/p><\/blockquote>\n

In a sign of the extent to which politics may influence sentiment, Kobeissi was one of many who referenced a grim forecast from billionaire investor Ray Dalio, founder of Bridgewater Associates, the world\u2019s largest hedge fund.<\/p>\n

In a LinkedIn post on Oct. 12, Dalio warned that the risk of \u201cWorld War III\u201d occurring had increased to 50% over the past two years.<\/p>\n

\u201cFortunately, the progression toward a world war between the biggest powers (the US and China) has not yet crossed the irreversible line from being containable (which it is now) to becoming a brutal war between the biggest powers and their allies,\u201d he wrote.<\/p>\n

\u201cIf these major powers do have direct fighting with each other, in which one side kills a significant number of people on the other side, we will see the transition from contained pre-hot-war conflicts to a brutal World War III.\u201d<\/p><\/blockquote>\n

GBTC \u201cdiscount\u201d closes in on two-year minimum<\/h2>\n

Beyond BTC price action, a firm resurgence is underway in the biggest Bitcoin institutional investment vehicle.<\/p>\n

The Grayscale Bitcoin Trust (GBTC) is now trading at its smallest discount to net asset value (NAV) \u2014 the Bitcoin spot price \u2014 since December 2021.<\/p>\n

As Cointelegraph reported, the discount, which was once a premium, was almost 50% earlier in the year, and GBTC\u2019s turnaround has come in tandem with legal victories for operator Grayscale over U.S. regulators.<\/p>\n

Now, markets appear to be more confident than ever that a spot price exchange-traded fund (ETF) \u2014 which Grayscale plans to create and launch out of GBTC \u2014 will get the go-ahead, opening up a flood of institutional interest in Bitcoin in the process.<\/p>\n

\u201cOne significant feature of GBTC is that it doesn\u2019t offer a straightforward mechanism for redeeming shares for actual Bitcoin, and it trades over-the-counter (OTC),\u201d popular trader and podcast host Scott Melker, known as \u201cThe Wolf of All Streets,\u201d wrote<\/a> in part of recent X analysis. <\/p>\n

\u201cThis structural element can lead to instances where its market price deviates from the underlying BTC value. Factors like market speculation, investor sentiment, liquidity constraints, and even regulatory news can influence this price divergence.\u201d<\/p><\/blockquote>\n

Melker continued that the door opening to GBTC becoming an ETF was \u201cstill far from a sure thing.\u201d<\/p>\n

\u201cConcurrently, the U.S. Securities and Exchange Commission (SEC) is also scrutinizing several other spot Bitcoin ETF proposals, including those from financial giants like Fidelity, Blackrock, and Franklin Templeton, which adds another layer of complexity and uncertainty to the landscape,\u201d he noted.<\/p>\n

GBTC premium vs. asset holdings vs. BTC\/USD chart (screenshot). Source: CoinGlass<\/em><\/figcaption><\/figure>\n

Mining difficulty set for imminent new record<\/h2>\n

The latest BTC price increase has helped boost prognoses for Bitcoin network fundamentals.<\/p>\n

Ahead of its next automated readjustment on Oct. 16, Bitcoin difficulty is currently forecast to expand to new all-time highs, per data from monitoring resource BTC.com.<\/p>\n

Bitcoin network fundamentals overview (screenshot). Source: BTC.com<\/em><\/figcaption><\/figure>\n

This is nothing new in 2023, the year in which both difficulty and mining hash rate have frequently achieved new records. The upcoming difficulty hike, however, could make it into the top three year-to-date at nearly 7%.<\/p>\n

Should it lock in, difficulty will cross the 60 trillion mark for the first time, reflecting the increasingly stiff competition among miners and unparalleled Bitcoin network security.<\/p>\n

Hash rate estimates, meanwhile, vary significantly by resource. Raw hash rate data from MiningPoolStats shows the latest all-time high of 497.66 exahashes per second (EH\/s) hitting on Oct. 9.<\/p>\n

\"\"
Bitcoin raw hash rate data (screenshot). Source: MiningPoolStats<\/em><\/figcaption><\/figure>\n

The high difficulty combined with comparatively modest BTC price levels inevitably opens questions over miner profitability. With expenses running ever higher per Bitcoin, concerns periodically appear over how incentivized miners are to continue.<\/p>\n

Just as with hash rate, estimates vary over how expensive the per-bitcoin aggregate production cost really is, with a multitude of factors, including physical location, all playing a part in the tally.<\/p>\n

As Cointelegraph reported, next year\u2019s block subsidy halving will additionally cut the amount of BTC received per mined block by 50%.<\/p>\n

\u201cI think price is okay for miners atm, but come halving and increasing difficulty needs to increase rapidly,\u201d James Straten, research and data analyst at crypto insights firm CryptoSlate, wrote<\/a> in part of X commentary last week.<\/p>\n

A precarious \u201cUptober\u201d<\/h2>\n

Does the fate of \u201cUptober\u201d 2023 hang in the balance? <\/p>\n

Related:\u00a0Bitcoin signals potential range expansion\u2014 Will SOL, LDO, ICP and VET follow?<\/em><\/strong><\/p>\n

Even modest changes in BTC spot price can influence the month-to-date gains for October thanks to the strength of the current trading range, which has been in place since March.<\/p>\n

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#Bitcoin<\/a> We did not get Uptober or Rektober but instead we got Choptober.<\/p>\n

This would be the first time after 4 years where Oktober would end up red.<\/p>\n

Last month was the first green September after 6 years.<\/p>\n

We’re only halfway through the month though so a lot can change. pic.twitter.com\/NsoVvH5O7D<\/a><\/p>\n

\u2014 Daan Crypto Trades (@DaanCrypto) October 14, 2023<\/a><\/p><\/blockquote>\n

While negative just last week, the push to $28,000 now means that BTC\/USD is up 3.5% since the beginning of the month.<\/p>\n

With two weeks until the monthly close, Bitcoin\u2019s ultimate performance remains anyone\u2019s guess. 3.5%, while far from poor, would still constitute Bitcoin\u2019s weakest October month since 2018.<\/p>\n

Data from CoinGlass further shows the worst October on record in 2014 produced \u201conly\u201d 12% losses for Bitcoin, leaving the door open for a new red record should conditions deteriorate.<\/p>\n

BTC\/USD monthly returns (screenshot). Source: CoinGlass<\/em><\/figcaption><\/figure>\n

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.\n<\/p>\n<\/div>\n