- Bitcoin has now rebounded conclusively from the lower bound of the Trading Envelope indicator with the prospect of US$36,000 in sight
- Rebound in financial markets and endorsements from high profile names are helping buoy Bitcoin’s fortunes
After ducking below US$30,000, Bitcoin bounced off its lower Trading Envelope indicator to rebound as both financial markets and the cryptocurrencies recovered with investors shrugging off concerns over the virus and buying the dip.
Buoying sentiment, Elon Musk has revealed that SpaceX holds Bitcoin and has no intention to sell it.
Speaking at “The B Word” conference hosted by the Crypto Council for Innovation, Musk discussed the outlook for Bitcoin with fellow backers Cathie Wood, head of Ark Investment Management, and Jack Dorsey, chief executive officer of Twitter (+2.36%) and Square (+4.37%).
According to Musk,
“I would like to see Bitcoin succeed. If the price of Bitcoin goes down, I lose money. I might pump but don’t dump.”
Musk even went as far as to say that Tesla (-0.79%) might start accepting Bitcoin once mining became less environmentally taxing.
The recent purge by Beijing of its cryptocurrency miners, a unique opportunity to remake what sort of energy is used to mine Bitcoin arises.
As Bitcoin miners have moved out of China, there is the prospect that miners can select renewable sources such as hydroelectric or geothermal.
Musk has acknowledged that Bitcoin is improving on its renewable energy credentials,
“It looks like Bitcoin is shifting more toward renewables. I would want to do a little bit more diligence to confirm the percentage of renewable energy usage is at or above 50%.”
Fellow Bitcoin advocate Wood suggested, corporations should consider adding Bitcoin to their balance sheets, partly as a hedge against deflation.
Wood added that the Financial Accounting Standards Board should reconsider how it classifies Bitcoin since institutions currently have to write off holdings when the price declines. Listing it as an intangible asset could help remedy that.
“Think about how explosive growth could be.”
For technicians wondering where Bitcoin could head to next, the Trading Envelope indicator suggests that US$36,000 is the next level to look out for.