Bitcoin’s $20,000 Collapses in the Cryptocurrency Market

The price range of $29,500, which has been around for the past year and a half, temporarily collapsed on May 11th (the first support line in the picture below- Click Here ), and there was a battle between Long and Short over this point for about a month. But on June 10th, this price range collapsed like a waterfall. It’s now crumbling to the last support line of $19511. The current price of Bitcoin is around $18500.

Here’s why $19511 was important.

When we look back at the history of Bitcoin, there were several cycles when we looked at it as a cycle of rising and falling. The peak price in the previous cycle was never breached downward in the next upward cycle. However, the price of 19511, the highest point of the previous cycle, collapsed for the first time in 12 years the day before yesterday. This is the price range shown in the second support line in the picture.

Many investors are more anxious because something that has never happened since Bitcoin was first created.

Each report is already talking about the end of the season. Today, I’d like to introduce a report on this.

There is no price for mining electricity. The fate of Bitcoin, the “psychological resistance line,” collapsed at $20,000

Source = Reporter Jeong Hyung-tae of Chosun Economy

Bitcoin prices fell sharply on the 18th, collapsing support for $20,000 (about 25.9 million won) and once fell to the 17,700-dollar level.

According to Bloomberg News, the drop in bitcoin prices on the 18th fell below $19,000 per unit, the lowest price since the price recorded in December 2020. Ethereum’s price, which ranks second in terms of virtual currency market capitalization, also plunged to the $800 range.

As of the afternoon of the 19th, the price of Ethereum is 1.3 million won It fell to around 1.2 million won a day ago.

Bitcoin’s $20,000 Collapses in the Cryptocurrency Market

The reason for the drop is the deterioration of the global macroeconomic caused by the Russia-Ukraine war and the collapse of even $20,000, which has been kept as a kind of psychological resistance. Bloomberg said, “The virtual currency industry is under increasing stress due to the impact of tightening the U.S. currency.Bitcoin has collapsed,” and CNBC even used the expression “the state of carnage in the virtual currency market.” As a result, Bitcoin has been on the decline for 12 consecutive days.

It’s only been green in the charts for the last 12 weeks, and that’s pretty much flat. Ethereum’s price also fell to the $1,000 level, which once reached the 800-dollar level. This is the lowest price recorded since January 2021.

I can’t even meet the cost of mining. Mining company too much consideration

Meanwhile, the shock of the $20,000 collapse is shaking even Bitcoin mining companies. Cryptocurrency is mined through high-level operations. For this, a high-end graphics card machine is needed, so a “miner” made by combining several expensive graphics cards is needed. However, just one graphics card consumes a lot of power, so one miner consumes a lot of power.If the price of Bitcoin is lowered like this, there is a possibility that even the electricity cost spent on operating the mining machine will not be recovered.

BitDear, a Chinese bitcoin mining platform, sent a notice to some mining machine users on the 17th to stop mining. I sent you a tweet saying that you reached the price point where you had to stop operating to avoid loss. According to BitDear, prices of at least $11,950 to up to $25,000 must be maintained to continue operating the mining machine based on local electricity prices in China.

This is the break-even point where the mining cost is higher than the actual bitcoin price when calculated at 0.4 yuan per kwh, the electricity price in China. The newer the mining machine, the less electricity it consumes, and the older it is, the more electricity it consumes, so the mining cost goes up. Most mining machines in China are known to cost between $17,000 and $19,000. This is why the cryptocurrency industry predicts that if bitcoin prices fall below this price, bitcoin miners may stop mining and start dumping bitcoin and mining machines.

On the other hand, some predict that the price of graphic guards, which had been rising without knowing due to the boom in the virtual currency market, could stabilize.

Is the price of a graphics card stable?

In Korea, electricity costs are higher than in China, so domestic miners are already stopping mining. .

Mr. Jung, an office worker, stopped mining Ethereum, which he had been doing since the collapse of virtual currency on the 13th. According to Mr. Jung, “When I calculated the rate of return, there was nothing left after excluding electricity bills no matter how much I mined.” We stopped mining.” Previously, if you leave your laptop on for about 18 hours, you will get an additional electricity bill of 10,000 won a month, and you will earn 40,000 won worth of Ethereum, leaving about 30,000 won a month. Now, Ethereum’s market price has fallen by more than 70%, making it difficult to extract electricity bills. Currently, if you look at the graphics card for mining, there are a series of proofs that Ethereum must exceed the cost of over 1 million won.

Some predict that the supply and demand of graphics cards will slow down as virtual currency prices fall. According to a Bloomberg report on the 17th, “Investors who purchased virtual currency mining equipment for about $30,000 in mid-2021 have so far mined about $5,000 worth of virtual currency.” If this mining of virtual currency using graphics cards no longer makes money, of course it will affect the price of graphics cards.

When the cryptocurrency market is falling without knowing the end, it is not wise to purchase Bitcoin on the domestic exchange and just want the price to rise.

It is more advantageous to actively use the short position (short selling), which bets on the direction of falling prices.

Some people still have unfamiliar or negative thoughts about futures trading. This is because there were few opportunities to access articles that were accurately explained about futures trading.