Coin Hoarding: Are People Hoarding Bitcoins?
Bitcoin‘s drop could have been technical; however, one non-technical cause is that investors are mindful of the currency’s scarcity. China prohibited state-owned firms from engaging in large-scale Bitcoin mining or any other mining activities some time ago. Although this may have caused a brief drop in Bitcoin‘s hash rate and resulted in liquidations, miners’ hoarding may escalate.
A new paradigm is that Bitcoin miners seek to stockpile more Bitcoin rather than sell their holdings as China, the US, and environmental regulations put the brakes on the mining sector. Investors may react by going on a buying frenzy for Bitcoin futures and exchange-traded funds. Bitcoin purists who are in it for the long term, as well as many other investors, may be prompted to stockpile Bitcoin as mining activity declines.
A new paradigm is that Bitcoin miners seek to stockpile more Bitcoin rather than sell their holdings as China, the US, and environmental regulations put the brakes on the mining sector. Investors may react by going on a buying frenzy for Bitcoin futures and exchange-traded funds. Bitcoin purists who are in it for the long term, as well as many other investors, may be prompted to stockpile Bitcoin as mining activity declines.
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