After months of pain, has the Bitcoin (CRYPTO: BTC) price finally made its last walk down despair avenue?
Cryptocurrency investors have received an extended stint of repetitive lashings since late last year. During this time, the Bitcoin price has receded by a tearful 54% from a top of A$91,100. Today, the original decentralised peer-to-peer payment network is fetching a price of A$41,640.
However, with the fear and greed index displaying 'extreme fear', has the more than decade-old cryptocurrency reached a floor?
More pain or gain ahead for Bitcoin price?
As always, there are forecasts being hurled by analysts of all shades between green and red. Though, there are a couple of factors that may suggest the original crypto is getting set for an upwards movement.
First of all, Tuesday's bounce that saw the Bitcoin price surge from A$40,500 to A$44,000 broke a nine-week drought of green weekly returns. Commenting on this, head of technical strategy at Fundstrat Global, Mark Newton stated:
While it might take some time for intermediate-term trends and momentum to improve, it looks right to position long for rallies up to $US34,218 (A$47,783) initially. This marks the first meaningful upside target that also aligns with BTC-USD's two-month downtrend.
In other positive news, Bitcoin's scaling solution for processing transactions — also known as a layer-2 protocol — reached a new all-time high for processing capacity. On 27 May, the Lightning Network hit a capacity of 3,915 BTC.
Another indicator that might suggest that the Bitcoin price is nearing a bottom is the disconnect between mining cost and mining rewards. As reported by CoinDesk, the high cost of electricity, paired with falling crypto prices, has resulted in unprofitable operations.
Many Bitcoin mining companies have sold their mined bitcoins in order to sustain operations. This has created downward pressure on the price of the cryptocurrency. In a way, this incentivises further adoption of renewable energy for Bitcoin mining. Which could wash away a pollutant cloud that has hung over Bitcoin's head.
