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Recently, Inner Mongolia, Xinjiang, Yunnan, Sichuan and other places responded to the call of relevant national ministries and commissions, and in late June, the virtual currency "mining industry" was forced to withdraw. At the same time, the People's Bank of China also interviewed the "virtual currency transaction" , agriculture, construction, Postal Savings, Industrial and Alipay and other banks and institutions, and conduct relevant supervision;

Bitcoin reacted "quickly" in this situation. From the 21st to the 22nd, BTC fell by about 22.69%, falling below the $30,000 level to a minimum of $28,805;

With the recent set of "supervisory actions", the pressure must be very high, and it is inevitable to say "Heaven" in my heart! But from another dimension, the energy consumption of Bitcoin has long been a topic of criticism from all walks of life."breakthrough",It is often criticized that transformation is imperative, but this time China's"promote"Perhaps it is another opportunity for the development of Bitcoin value!!!

1. Can Bitcoin be sustainable and have a future under the high-pressure regulatory situation?

2. What is the core value supporting Bitcoin?

3. Is there a game between big countries behind such a big move?

This paper focuses on these three points for elaboration and analysis.

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Bitcoin: A Peer-to-Peer Electronic Cash System

On November 1, 2008, Satoshi Nakamoto published the white paper "Bitcoin: A Peer-to-Peer Electronic Cash System" in the cypherpunk world. There are no ripples, and many people have tried in history (point-to-point new electronic currency system that does not require credit) but have failed;

In “Analysis of Bitcoin’s Economic Attributes,” the researcher elaborates:

• "Bitcoin is not regulated, and it is impossible to be regulated. The decentralized "trust attribute" creates the consensus value of Bitcoin. This system is based on the agreement, and the transaction fees charged to users are determined by the users themselves, so there is no need for supervision. ;

• The design of Bitcoin as an economic system is revolutionary and deserves the attention and scrutiny of economists. Even if it is so volatile so far, its remarkable function and use will further encourage economists to study this wonderful structure”

So the success of Bitcoin is a very great miracle! ! !

Bitcoin was originally conceived as "an electronic currency that is not manipulated by any political or financial power", but contrary to expectations, its price fluctuations are often affected by politics and finance (though not manipulation), and the payment attribute (electronic currency) of Bitcoin is also drifting away from it. Due to the scarcity of Bitcoin, global consensus, Due to the characteristics of decentralization and mining, Bitcoin has become a digital gold with a storage function rather than a currency for circulation and payment;

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Mining shut down, Bitcoin computing power dropped sharply, how will it affect the price of Bitcoin?

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BTC-block time

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BTC-computing power

The current BTC network computing power is 89.24EH/s (68.01EH/s on June 28), while the historical peak was as high as 197.61EH/s, and the computing power dropped by 49.29% (China’s computing power accounts for 91. 8EH/s means that the computing power is 91800000T, and the computing power accounts for 50%);

The sharp drop in computing power this time can be said to be the most destructive "blow" to Bitcoin; many people ask the sharp drop in Bitcoin computing power, what is the impact?

There are 2 effects:

• Extended the block generation time of Bitcoin, if there is no option of "mining difficulty", Bitcoin will be affected by halving the time to prolong the entire Bitcoin mining cycle, resulting in short-term currency price fluctuations;

• The decline in computing power can be seen as a reduction in the number of people mining, which will lead to a decrease in mining difficulty, faster block generation, and easier access to Bitcoin, which will cause Bitcoin selling pressure (of course, I believe that no one will be so stupid that the price is too low) throw)

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BTC-mining difficulty

Bitcoin will make the most "elegant" correction 24 hours later (14:00 on July 2), and the difficulty of mining will usher in the largest drop in history (-26.42%), and the block generation time of Bitcoin will resume at that time to the normal level in about 10 minutes;

At present, domestic mining machine operators are actively deploying overseas mines to seek solutions to operational problems. Miami, Kazakhstan, Texas and El Salvador have all expressed interest in "investing" in Chinese miners.

After hosting the Bitcoin Conference in Miami, Florida, the mayor of Miami, Francis Suarez, said that the door of Miami is always open to Chinese miners and is willing to provide cheap nuclear energy to support mining activities. It even shouted to welcome the arrival of Chinese miners;

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Value-Bitcoin Support Logic

The fundamental factor for the price rise of Bitcoin is the increase in market demand;

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Capital injection institution

According to data from OKLink, there are currently 555,040 companies publicly holding bitcoins, accounting for 2.60% of the total bitcoins. The top 5 holdings of bitcoin institutions are:

• Block.one（164,000.00 pieces)

• MTGOX K.K.（141,686.00 pieces)

• MicroStrategy（115,084.00 pieces)

• Tesla（38,571.43 pieces)

• The Tezos Foundation（18,image description

Grayscale position

As Bitcoin reaches the bottom, major institutions and countries are beginning to move around, building relevant regulations and investment strategies to enter the Bitcoin market;

like:

• Soros Fund Management CIO Dawn Fitzpatrick approving trades in Bitcoin and possibly other cryptocurrencies;

• American corporate payment company NCR announced an agreement with New York Digital Investment Group (NYDIG), 650 U.S. banks will soon be able to provide Bitcoin purchase services to approximately 24 million customers;

• Germany's "Fund Positioning Law" came into effect, and a maximum of 415 billion US dollars will flow into the encryption market;

• American pension fund Fidelity Investments Hadley Stern said that 1% of the pension fund will be invested in cryptocurrency in the future;

• .......................

These are just a small part of the implementation of relevant investment institutions and encryption regulations. It can be said that the current development trend of cryptocurrency is very impressive~

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BTC - supply details

Bitcoin ushered in the third halving in history in May 2020, and the block reward was reduced from 12.5 BTC to 6.25 BTC;

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BTC- the highest price is 64854$

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BTC- the highest market value reached $1187.783 billion

As big hedge funds and massive investment banks turn to Bitcoin, ordinary consumers and investors will follow suit. This year is the best testimony~~

Consensus

1. Technology application

Blockchain technology can be said to have been born together with Bitcoin, and it was also born out of Bitcoin. At present, the world's vigorous development of artificial intelligence, Internet of Things, virtual and reality, smart cities, etc. are all inseparable from the basic construction of blockchain technology, ensuring the security, efficiency, privacy and decentralization of its data. functions, its technical development prospects will have unlimited possibilities;

2. Safe-haven assets of small national institutions (anti-inflation properties)

During the period of hyperinflation, Bitcoin can be regarded as a "safe haven asset" for some small countries, especially in today's global inflation, small countries are unable to resist, and money is becoming less and less valuable. At this time, BTC may be more valuable. Good choice;

Bitcoin is a very special "safe haven asset" that can only be used as a safe haven for hyperinflation, or a hedging tool for currency crises;

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BTC - Fiat currency country

The Congress of the South American country El Salvador passed the "Bitcoin Law" with an "absolute majority" vote, becoming the first country in the world to use Bitcoin as a legal tender. This can be seen as the development of Bitcoin"A big step";

The essential core of any value is consensus, and the foundation of consensus is trust, which is the "sharp sword" to solve all development problems;

4. The crypto industry is booming

Today's encryption circle is booming, and new things are constantly emerging, such as Ethereum's "smart ecology", Polkadot's "ten thousand chain interconnection", Filecoin's "permanent data storage", DeFi's "decentralized finance" and so on It is the process of our progress;

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Compared with China's "frozen" policy supervision, why is the policy of the beautiful country "enthusiasm" instead? ? ?

Inflation Bubbles - Maintaining Economic Stability

This bull market,"From aunt to student"All participated in the upsurge of copying Bitcoin. This is a kind of short-term speculation, without the concept logic of long-term investment (this kind of noob is easy to follow others' opinions and be cut off), and it is easy to cause social and economic instability;

At present, the crazy printing of money in the beautiful country is serious and the inflation is serious. Bitcoin is deeply bound to the US dollar, which has great risks for our country in the short term. BTC cannot be used as a tool to input inflation funds into China, so it is necessary to "cool down" Bitcoin;

Zhou Xiaochuan, former governor of the People's Bank of China, said recently,"Bitcoin is a commodity that can be used as an asset allocation, but it is not a currency"

It can be seen from this that the country does not have the idea of ​​banning Bitcoin completely, but because in this "bull market", many people lose their rational leverage investment, the risk is too high, so the country needs to take action. (Globally, only China and the United States can affect BTC)

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CPI-USA

Rich Dad Poor Dad author Robert Kiyosaki recently warned that "the biggest crash in the history of the world is coming." To put it bluntly, the U.S. financial market is on the verge of collapse. There are problems in the U.S. stock market, bond market, and foreign exchange market. Most of the U.S. stock market indicators have hit new highs. Such as CPI, population unemployment indicators and so on. The U.S. stock market continues to record highs, the bubble continues to expand, and the financial crisis may come at any time. The core reason for this "financial crisis" is the U.S."image description".

S&P 500 hits record highs - US

In the past ten years, the United States has printed nearly 22 trillion US dollars in money printing (Obama printed 9 trillion US dollars in 8 years, Trump printed 7 trillion US dollars in 4 years, Biden's 230 million infrastructure plan 180 million American family plan 1.9 Trillions to deal with the epidemic), the size of the bubble can be predicted~~~

In the past, the United States printed money and the whole world "paid the bill", but now it is different. China was the first to recover from the black swan event of "COVID-19" and achieved strong positive growth, becoming a country that can dominate global export pricing;

Supporting India as a new world factory, but in this black swan event of "COVID-19", we have also seen India's performance;

China is currently the world's most important exporter of foreign trade. No matter how expensive iron ore and other raw materials are, the pricing power is in our hands. The U.S. prints money to spread inflation to the whole world to alleviate itself, but the export pricing power is in our hands, and the U.S., which has strong purchases, has to swallow the consequences. The U.S. is still gritting its teeth and insisting on not raising interest rates.

Source - Why is China Retiring Bitcoin Mining Machines?

The economic game between China and the United States is basically petrodollars. About 70% of my country's crude oil and 40% of natural gas need to be imported, which means that we are still "stuck" in terms of energy. We need a new energy revolution to solve energy problems, so the "carbon neutrality" of the Paris Agreement has become our choice. my country announced that it will reach its carbon peak in 2030 and achieve carbon neutrality in 2060!

At present, power resources are relatively scarce, and some factories should have a deep understanding. Bitcoin consumes the most electricity in the encryption industry, so our country needs to give up electricity.

You'd say we're using leftover, wasted off-grid electricity!

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Summarize

BTC-S2F model

Analysis and prediction: Bitcoin will reach $90,000 in 2022 (investment is risky, no investment advice)

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BTC-Activity

The current market value of cryptocurrency is 1.3 trillion US dollars, which has shrunk by nearly 50% compared to the 2 trillion market value in the previous few months, and many people are dormant. Regardless of bulls or bears, it is a moment when the market is seriously undervalued, and your cost of entering the market at this time is often the lowest;