Will Tesla’s Bitcoin Payment Integration Electrify the BTC PriceCEO and co-founder of Tesla – Elon Musk just a few hours ago confirmed the acceptance of Bitcoin as a payment method for Tesla vehicles. Mr Musk also added that Bitcoin will not be converted to fiat.
Soon after the release of the tweet, Bitcoin price climbed to $56 250, adding 3% to the daily gain of the price. On March 14, Bitcoin set a new record high at $61 779 and retraced, not reaching $62 000 long-awaited by many investors. Since March 14 Bitcoin has been following a 10-day downtrend. Some stats show speculative activities before the March 14 dump. There was a high exchange inflow of BTC and approximately 17.9K BTC entered the exchanges. From March 14 up to March 21, the inflow volume dropped from 48 480 BTC to 18 200 BTC forming a slide of 30 280 BTC, leading a 30-Day exchange inflow volume to drop by 32.70%.
As seen on the chart above the exchange outflow didn’t affect the price of Bitcoin much, as the amount of Bitcoin was going out of exchanges, the price looked stabilizing. Bitcoin could have started the new hike sooner if it wasn’t the gaining US Dollar. Even the quote from the FED Chairman Mr. Powell on Monday couldn’t support the jump of Bitcoin and the reason is during this quote Mr. Powell gave an edge to the US Dollar while saying “It’s more of a speculative asset, it is essentially a substitute for gold, rather than the US Dollar”. In his speech, Mr. Powell also claimed that cryptocurrencies are not backed by anything and that they are particularly not in use as a means of payment.
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Now with Tesla, the 6th ranked US company by market cap, integrating payments in Bitcoin it will be interesting to watch how FED will act in this case. Surely Bitcoin will be accepted by many and become the payment instrument by the time, the question remains is when the governments admit the value driven by Bitcoin. The fact that Bitcoin is mined and the World’s largest economies have agreed to go for a carbon-neutral power, will give Bitcoin a heavier scarcity for the upcoming years.
Bitcoin’s energy consumption has a negative impact on the environment and eventually mining will be regulated firstly to eliminate the carbon-footprint of Bitcoin into the Global environment. Currently Bitcoin mining consumes 87.168 TWh per year, and according to the Cambridge Bitcoin Electricity Consumption Index the total consumption could reach 136 TWh per year this year, taking out the entire Sweden in this race.
The regulation on mining and the new global carbon-neutral movement will have an impact on miners which will bring the scarcity to Bitcoin and eventually increase the transaction speed and fees, as a result Bitcoin price is expected to rise.
Before getting too futuristic and thinking of ways to get mining to space, let’s take a look at the Bitcoin chart to see the patterns and levels for mid-term.
As seen on a 4 hour BTC/USD chart below, Bitcoin retraced from the dynamic support of the first impulse wave, beginning on January 27.
There is a falling wedge being formed on an hourly Bitcoin chart and according to the rules of this pattern, when the breakout from the wedge is confirmed, the price will jump towards $66 950 if the breakout is confirmed soon and the February’s high is tested as support and towards $65 825 if the breakout is delayed and Bitcoin follows 5-wave correction formation.
According to the Elliott waves theory, Bitcoin is still in the completion of an Intermediate wave 5, which should be completed soon as there are signs of the end of the Minor count’s wave 4 formation.
By the time writing of this article Bitcoin on Overbit is traded at $56 267 and is caged between MA200 and MA100 on a 4-hour timeframe. There are several resistance lies ahead, the first would be at $58 450.
The ascending ending diagonal suggests that the following new ATH could be at $64 300 if Bitcoin keeps the pace and breaks above the local dynamic resistance.
While the Wave analysis is entertaining by it’s virtue, it sometimes is hard to define the exact completion of the impulse wave formation. Hence, I highly recommend to keep an eye on dynamic and static support and resistances.