The combination of weak near term technicals, a dip in hash rate, questions over a secretive miner/Core dev meeting, and sustained interest in ETH/ETC has pushed Bitcoin’s exchange rate down more than $20 over the weekend.
While the drama continues to run high in the Ethereum universe, Bitcoin has its own little bit of drama going on for the time being. First of all, with Segregated Witness rolling out to production in the next Core release and rumors of miner dissatisfaction over the past month, a group of seven large miners and over a dozen Core devs attended a closed-door meeting this weekend. Although details are sparse, speculation is that on-chain scalability is the topic du jour. Also adding pressure is the fact that we have seen a noticeable drop in the hash rate over the past few weeks now that the block reward has been cut in half. Below is a 2-month chart of the Bitcoin hash rate difficulty. Bitcoin Hash Rate VS Difficulty
This drop has traders on edge about a potentially self-reinforcing cycle of lower prices and a lower hash rate, and while we cannot entirely dismiss this as a possibility we think that in the context of the longer term chart it is not something to worry too much right now (although it is certainly worth keeping an eye on). Take a look at the 9-month hash rate chart below. It looks like a minor pullback in a strong uptrend to us. Bitcoin Hash Rate VS Difficulty As we move on to the exchange markets we don’t find much reassurance here either. On the 3-day chart below we can see that the breakdown out of the pennant consolidation is now real and the price is making a run for support. Despite a pennant being a […]
