Bitcoin Following Another Government Letdown
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In this episode of BitcoinLinux’s “Fed Watch,” Christian Keroles and Ansel Lindner discuss the broad macroeconomic atmosphere in which bitcoin finds itself. They touched on bitcoin mining, price, the dollar, commodities and the economy in general. In many ways, markets are in the quiet before the storm. After the 2020 crash and subsequent rally has now run their course, markets are going to resume previous trends.
In our bitcoin mining commentary, we focus on the behavior of hash rate over the last few months and the unique market for mining rigs globally. The hash rate has not increased proportionally with price, and miners are enjoying quite high margins right now. Why more hash rate has not joined the market is discussed in depth. Of concern here is the breakdown in supply chains from China. China is currently where many of the mining rigs are manufactured, and it’s where there are large marginal players in hash rate. Supply chains are likely backlogged and breaking down at the same time. Companies can be struggling financially at the same time that they have orders backing up. Lindner and Keroles hope to get a mining expert on the show soon for an interview to ask them some of these important questions that are largely not understood, even by Bitcoin experts.
The hosts also had a fascinating discussion about social media, community building and gaming. The Bitcoin and markets podcast community has built a valuable community on Discord and slowly moved away from Twitter over the last year. Smaller communities where you can build relationships instead of followings may be the future trend.
They wrapped up the episode talking about macro trends and the bitcoin price. It is important to put this rally into context of both past bitcoin behavior and the current macro climate. In an era where employment and solvency are no longer taken for granted, what part does bitcoin play? It takes years or even decades to reform economies to new realities. Bitcoin will not go up in a straight line. The price opened the year at $28,999, and after only 20 days, many people believe it is out of the question that price could break back below that level in a short-term consolidation. Nothing goes up in a straight line.
All of that, and so much more, is covered on this episode. Don’t miss it.