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Fidelity noted that the way miners are accumulating and the mining industry has revived post the ban in China, they are set for a long haul.
Bitcoin has been giving jitters to investors amid its recent volatility in the range between $40,000-$44,000. There’s no clear indication as to where BTC could be heading with investors on the edge. But financial giant Fidelity Investments believes that the Bitcoin (BTC) cycle is far from being over. Its crypto arm Fidelity Digital Assets currently manages more than $4.2 trillion in assets under management.
Amid all the ongoing uncertainty, Fidelity shared some of its key takeaways on the future of digital assets. In one of the reports released last week, Fidelity talked about the encouraging state of Bitcoin miners. The report notes:
“As Bitcoin miners have the most financial incentive tho make the best guess as to the adoption and value of BTC (…) the current bitcoin cycle is far from over and these miners are making investments for the long haul.”
The Bitcoin miners are recently on an accumulation spree. Last week, Bitfarms added 1,000 BTC to its kitty in a fresh $43.5 million Bitcoin purchase. furthermore, charts show that Bitcoin miners are accumulating at the fastest rate since May 2021.
— Bitcoin Archive 🗄🚀🌔 (@BTC_Archive) January 11, 2022
Fidelity Praises the Recovery in the Bitcoin (BTC) Hashrate
Fidelity further said that the recovery in the Bitcoin (BTC) hashrate is truly commendable. Following the Chinese ban in May 2021, the Bitcoin mining hashrate crashed by 50%. However, it has now fully recovered and miners have successfully migrated to the US and other locations thereby getting their mining rigs online once again.
Fidelity notes that the rebound in the hashrate being “more widely distributed around the world,” shows that miners are set for long-term profits. Moving beyond miners, Fidelity also made some bold predictions about more nation-states accepting Bitcoin as a legal tender. The financial giant noted:
“There is very high-stakes game theory at play here, whereby if Bitcoin adoption increases, the countries that secure some Bitcoin today will be better off competitively than their peers. We, therefore, wouldn’t be surprised to see other sovereign nation-states acquire bitcoin in 2022 and perhaps even see a central bank make an acquisition.”
Tonga’s former MP has recently suggested that the country could be adopting Bitcoin in late 2022. Furthermore, there’s some expectation that we will be having greater regulatory clarity on the use of crypto. This might further accelerate adoption and participation from institutional players.