Bitcoin eyes recovery amid rising hashrate and inflation concerns
Bitcoin’s (CRYPTO:BTC) price correction between October 21 and 22, which saw a 4.1% drop after facing resistance at $69,500, raised questions among investors about reclaiming the $67,000 mark.
Despite this, key factors are aligning that could support a price recovery.
Billionaire hedge fund manager Paul Tudor Jones stated that regardless of the upcoming US presidential election outcome, the country’s inflationary path will persist.
In an interview on October 22, Tudor Jones emphasized the importance of hedging with assets like gold and Bitcoin, highlighting that many investors remain underexposed to these commodities.
He predicted that the US public deficit would exceed current projections, potentially leading to a decline in the value of the US dollar.
Amid this uncertainty, Bitcoin’s fundamentals remain strong.
The increased demand for gold, traditionally a safe-haven asset, alongside record earnings from tech firms, indicates diminishing confidence in the stock market.
This positions Bitcoin as a viable alternative asset, sharing the key hedge properties with gold.
The growth in Bitcoin’s network hashrate adds further optimism.
According to Blockchain.com, the 7-day average hashrate has surged, reflecting sustained investments in ASIC mining equipment by network validators.
This increased capacity indicates long-term confidence among miners, who typically require at least 18 months to achieve profitability.
Consequently, lower short-term selling pressure from miners could help establish $67,000 as a solid support level for Bitcoin.
Additionally, interest in Bitcoin exchange-traded funds (ETFs) continues to rise.
Data from Farside Investors and CoinGlass reveals net inflows of $2.68 billion since October 11, pushing total assets under management in these ETFs to $51.7 billion.
Despite the political uncertainties, Kristin Smith, CEO of the Blockchain Association, believes that the upcoming US Congress could be the most crypto-friendly yet, as more lawmakers are willing to discuss digital assets.
These factors collectively provide optimism for Bitcoin’s continued growth amid inflation concerns and rising institutional interest.
At the time of writing, the Bitcoin price was $67,304.78.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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