Following a recent study by Delphi Digital, it seems a bright future for Bitcoin may be right around the corner. In fact, investors in the cryptocurrency may begin to see the a turn in a positive direction as soon as the first quarter of 2019.
Reasoning Behind the Good News
In the publication released by Delphi Digital, titled “The State of Bitcoin: Long-Term Value Potential & Analysis” the research firm points out several factors that lead to an impending Bitcoin rally. Looking at recent advancements in the ability to scale without jeopardizing security and stability, global demand, and factors driving its value up, Delphi Digital has been able to paint a very positive picture.
What to Expect?
Investors should pay attention to both the short-term and the long-term factors before making decisions on how to proceed with their Bitcoin investments.
In the short term, UTXO analysis points to the fact that we are in the middle of an accumulation period, and that soon after we are likely to see a similar pattern to what investors experienced in 2014. If the pattern is anything similar to what Delphi Digital is suggesting, big gains are sure to come.
The long-term is looking good, too. Looking at features of Bitcoins such as Store of Value, how it is exchanged on the global market, and more mature methods of investment diversification, it would seem that Bitcoin is on very stable ground.
Specific Factors Affecting Market Value
There are many specific factors to pay attention to. One of the most important is the maturity of the digital currency.
What are UTXOs
In order to get a clearer picture of what UTXOs (https://bitcoin.org/en/glossary/unspent-transaction-output) are and why they matter in a study predicting the rise of Bitcoin, we have to break down the term. UTXOs (Unspent Transaction Units) mark transactions which occur on the blockchain. For each of the UTXOs there must only be one Spent Transaction Unit that correlates to it for that transaction to be valid. That validation process is why something called Transaction Identifiers (TXIDs) are attached to each of the UTXOs. Therefore, by looking at trends in UTXO activity over a long period of time, analysts can predict future movements within the industry.
There is plenty of evidence to show that people are now holding on their Bitcoin longer making it scarcer and more valuable. At the same time, there is new interest (thus new money) going into Bitcoin making what is available more desirable. Of course, there is also the issue that as much as 3 million Bitcoins have been lost, presumably forever, bringing even more value to the coin.
Not only are investors now confident enough to maintain their Bitcoin assets for the promise of long-term payoff, but it also means the original value realities (which are based on a finite number of coins) is no longer the same given the fact that so many have been lost.
Is Now the Best Time to Jump Aboard?
Now, is probably not the best time to invest in Bitcoin as the bottom is yet to come. Soon, however, investors will likely be jumping at the opportunity to take part in the upward slope. Keep your eye on the first quarter of 2019.