Some bullish messages are giving some encouragement to the crypto market after the price of Bitcoin recently fell to a low for the year. So, at the time of publication, BTC/USD has cleared the USD 17,000 mark and is now fighting the above resistances. Can Bitcoin continue its rise and perhaps end the year above $20,000? Or is the next correction already imminent? A look at the most important news and technical chart analysis gives clues as to where the price of Bitcoin could move next.
Texas is going to be Bitcoin Valley
US Senator Ted Cruz has recently been very positive about Bitcoin. So he has plans to build a kind of crypto valley in the US state of Texas. This is what the politician recently said at the Texas Blockchain Summit. According to this, Cruz wants to use the mining, which is a new Bitcoin “to determine”, strategically for the energy supply in the state.
According to him, Bitcoin Mining could help to monetize energy in the field of oil and gas production. The energy used for the mining activities should be available at short notice as an emergency reserve in case of supply gaps and energy failures.
Speaking at the event, Ted Cruz explained, “The beauty of it is when they invest heavily in bitcoin mining like we do in Texas, if we have an extreme weather event, it can be a heat the -large, which is common in the state of. Texas, or cold-cold, which sometimes happens here, can be turned off in a split second. That electricity can be immediately fed into the grid to heat or cool people’s homes and to keep businesses going. This is a huge reservoir of excess capacity, which I think is very beneficial.”
— CoinMarketCap (@CoinMarketCap) December 5, 2022
Use mining energy for supply emergencies
In his speech, the senator suggested making Texas an attractive place for the crypto industry. In return, they should have access to relatively inexpensive energy and benefit from free enterprise.
The US Senator’s plans are likely to be directly related to his personal interest in cryptocurrencies. At the summit, Cruz described himself as an avid Bitcoin fan who makes weekly purchases in BTC. However, this is the only cryptocurrency in his portfolio.
Cruz added, “I like bitcoin because the government can’t control it. I think bitcoin means investment. It means chance. It means prosperity. It means financial independence. I also think that increasing bitcoin mining in Texas is a big benefit to the network’s resiliency.”
Already, Texas is recognized as one of the fastest growing crypto mining hubs in the United States, and the government has maintained a pro-crypto stance on the market for months, despite recent incidents like the FTX crash that hit the market is hard.
Russia wants to establish a decentralized payment system internationally
Russian President Putin also seems to be crypto-friendly these days. The country is struggling with the economic sanctions imposed by the West, so it is committed to a decentralized payment system based on blockchain. As Cointelegraph reports, Putin gave a speech at the AI Tour International Conference in Moscow. The President used the event, hosted by major Russian bank Sberbank, to attack the West’s monopoly on global financial payment systems that would allow it to impose economic sanctions on other countries.
Therefore, according to Putin, the world needs an independent international payment network that is much more convenient and safer for users and whose transactions are protected from access by banks or interference from third countries. The current system of international payment transactions is expensive and correspondent accounts and regulations are determined by a tight-knit club of states and financial groups.
Putin went on to say that he is confident that the payment systems he is considering will make progress in response to the current situation. However, he left it open as to whether Bitcoin could be this payment system for him, whether he had another cryptocurrency in mind or whether it should be a completely new product.
— Crypto Hunters Elite ✪ (@coincatch1) December 5, 2022
Harvard Researcher: Central Banks Should Buy Bitcoin
A current working paper published by Harvard economic researcher Matthew Ferranti can also be seen as positive news for Bitcoin. As Politico reports, Ferranti suggests that central banks around the world should start buying bitcoin. Bitcoin can serve as a defense for a state if, for example, there are economic sanctions against the country. He cited US sanctions as an example. States that are particularly at risk should buy more Bitcoin.
Bitcoin as a digital asset is a good hedge, especially for countries with poor technical infrastructure to safely store large sums of gold. At the same time, Ferranti also emphasized that Bitcoin is not a complete replacement for hedging with gold. From his point of view, the fact that the gold is much less volatile than Bitcoin and therefore works better as a reserve on gold.
The positive news seems to be giving Bitcoin price a small boost at the moment. But is it really a sustainable recovery or is the next selloff expected in the near future?
Price Prediction: Will BTC Fall to $8,800?
Technical analysis of the daily chart shows Bitcoin price still below a key resistance zone around $17,600. Until November 9, this mark was the main support of a descending triangle from which Bitcoin has since broken down. Until Bitcoin manages to turn this resistance into support, the short-term outlook for BTC remains bearish.
For now, it could only be a retest and thus a confirmation of the correction from this bearish chart pattern. Bitcoin has not yet reached the technical price target of around $8,800. If BTC/USD fails to scale back above $17,600 and hold at this level, the correction could be over.
In this case, Bitcoin has until mid-February 2023 at the latest to break out of the formation and reach a technical price target between $26,500 and $28,000 – depending on the timing of the breakout.
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