9/19 ANDY HOFFMAN (CryptoGoldCentral.com): Is Crypto-Winter “Favorable?”

Describing the current state of the cryptocurrency market is as much art as science – particularly when separating Bitcoin versus altcoins, and the its MARKET relative to its NETWORK.

Regarding altcoins, we are unquestionably amidst, in Trace Mayer’s words, “crypto-winter” – as most are trading at or near cyclical lows, including bellwether “top tiers” like Ethereum and BCash. Moreover, “operationally,” the altcoin sector is spinning its wheels – as it’s difficult to see more than a handful advancing their stated objectives. That said, Bitcoin dominance is nowhere near last year’s highs, attesting to an increasingly strong investor belief in altcoins that, in my view, portends well for their cumulative future.

As for Bitcoin, it has never operated more efficiently – with its highest-ever hash power, lowest-ever mining concentration…and brightest-ever outlook for its monetary use case, given the lethal global combination of rising inflation, interest rates, economic weakness, and debt. This, at a time when the historic store-of-value leaders, gold and silver, have fallen to all-time inflation adjusted lows, amidst declining demand in the emerging Digital Age.

https://twitter.com/ConanOBitcoin/status/1040243146175799296

- ConanOBitcoin

Price-wise, there’s no way one can possibly describe this year’s Bitcoin action as “crypto-winter” – given that it’s market cap bottomed 7½ months ago at the “Hoffman Line” of $100 billion. Which, I might add, wasn’t first achieved last November. Since the February low, Bitcoin has defended this level a half-dozen times - as rising institutional demand has been more than enough to absorb mine supply, bear market-biased trading schemes, weak handed retail sellers, and non-fundamental sales by entities like the Mt Gox Trustee and Bitmain.

To that end, I found a Tweet by Trace Mayer yesterday to be very interesting, and provocative – in “hoping” crypto-winter will last 6-9 months longer, as this would constitute a “favorable” outcome. Given Bitcoin’s historically undervalued state – trading at a “Mayer Multiple” (spot price divided by 200 DMA) that has only been lower 22% of the time - he doesn’t believe a significant price decline is likely. However, the bigger question is whether such an outcome should be considered “favorable”…and if so, why?

https://twitter.com/TraceMayer/status/1041355220561932288

- TraceMayer

https://twitter.com/TIPMayerMultple/status/1042390129183207424

- TIPMayerMultple

I am of the mind that Bitcoin passed its “point of no return” last year, when it won the scaling debate – solidifying its future when it defeated “competitors” like BCash early this year, and maintaining a $100 billion market cap throughout a vicious crypto bear market.

The longer it maintains this valuation, amidst an environment of violent altcoin headwinds, and extremely weak public sentiment, the more likely this support will become impenetrable – in turn, fostering potentially dramatic demand growth from deep-pocketed institutions and retail investors…which in turn, would turn mainstream commentary bullish, generating further, potentially parabolic demand increases.

Conversely, a plunging price would do little to improve Bitcoin growth and adoption, in my view. Sure, it would destroy more altcoins - but altcoins are not going away, as that genie is also out of its bottle. Thus, if the current crop is decimated, it will simply be replaced by a new one in the next bull market cycle. As for a $3,000 Bitcoin price – which like Trace, I do NOT expect to see – it could set back Bitcoin’s momentum for a significant amount of time, at a time when its emergence is as needed, practically speaking, as it is financially desired by holders.

Thus, our cumulative goal, as HODLers, is to do all we can to spread the word of Bitcoin’s benefits, and hope the investment community “gets it” enough to continue supporting the price through what is likely the tail end of said “crypto-winter.” Not that Honey Badger Bitcoin can be prevented from fulfilling its destiny either way, but from where I stand, the sooner the better!