Bitcoin Struggles for Direction, with Canada Looking set for a Bitcoin Rush

The Bitcoin bulls were in search of a rally going into the weekend and things were looking good in the early part of the weekend, with Bitcoin moving to a weekend high $14,619.

There was a lack of momentum however and, with volumes on the lighter side through the weekend, it was downhill from there, with Bitcoin closing out the weekend down from Friday’s $14,167.98 close to a Sunday close of $13,732.75.

Last week, the South Korean government demonstrated just how influential governments and regulators can be on the direction of cryptocurrencies, with the threat of a ban on trading and a shutdown of the exchanges a scenario that could still play out at any time.

This time around, the government’s decision was to go against the Justice Department’s plans to introduce legislation to ban trading. While the U-turn eased tensions, the reality remains that the cryptocurrency landscape is changing, with new laws in South Korea requiring identity verification, the government having banned the opening of anonymous accounts.

There is still plenty for the markets to consider and some uncertainty over what impact the Chinese government’s planned clamp down on Bitcoin mining will play a hand in the direction of Bitcoin over the near-term.

Bitcoin is unlikely to see hashrates collapse, post an initial correction, with the mining cartel likely to relocate mining operations to other favourable mining environments, where electricity costs are low and temperatures are on the cooler side.

Bitcoin hashrates fell from Saturday’s 17.8749E to 16.7562E on Sunday. It’s too early to suggest that Sunday’s decline was as a result of the Chinese government’s progress on bringing an end to the power sapping mining that has certainly been rewarding for the Cartel.

It will be interesting to see who reaps the benefit of the Chinese government’s decision to bring mining to an end, with the market chatter pointing to Canada, Switzerland, the U.S and even India.

Bitmain has already announced a Swiss mining arm and is in talks with the Canadian government to open mining operations in Quebec, with Quebec reportedly producing a significant hydropower surplus, which would fuel a mining boom.

In the meantime, a fall in Bitcoin hashrates will be considered a negative, with Bitcoin Cash and Bitcoin Gold likely to benefit until the dust settles, though even Bitcoin Cash and Bitcoin Gold are struggling at the start of the week.

Get Into Cryptocurrency Trading Today

At the time of writing, Bitcoin was down 0.25% to $13,613.6, with Bitcoin falling back from an intraday high $13,831.7.

It perhaps comes as little surprise that Bitcoin futures prices are down through the day, with 17^th January contract down $170 to $13,630 and March’s contract down $260 to $13,550.

With the futures contracts providing very little direction for Bitcoin investors, investors will continue to look elsewhere for opportunity, with BNB up 10.3% against the Dollar, NEM’s XEM up 6.92% and EOS up 6.21% through the first half of the day.

Buy & Sell Cryptocurrency Instantly