• Bitcoin looks to climb beyond a daily high of USD 7,284
  • Ross Ulbricht claims Bitcoin will see USD 100,000 by 2020
  • Riot Blockchain has expanded its Bitcoin mining facility to increase its hash rate share to 248 petahashes per second

Bitcoin trading has not changed much, with only USD 100 separating the daily high and low, but Bitcoin bulls will be happy to see that a higher low on a Friday, as price right now is creeping up to the daily high of USD 7,284 (CoinDesk) in the midst of morning trading for the Americas.

Whatever the time left in December, Bitcoin certainly does not look close to testing its 2019 low close to USD 3,400. If anything, some people are expecting a five-digit figure even before the new year. One guy certainly believes even a six-figure valuation will be in sight by 2020.

The reason for this, says Ross Ulbricht, the infamous founder of the original anonymous dark marketplace Silk Road, is the clear indication on the Elliott Wave Theory technical indicator. Writing in a series of Medium blog posts, published based on letters he wrote while in prison, Ulbricht says that such an analysis was even possible without knowing the daily movements of Bitcoin price, and ignoring the market’s general condition.

He looked for investor psychology extremes in Bitcoin to predict the highs and lows of market cycles, and he believes that in Bitcoin markets, emotions are even more significant than in traditional markets. Thus, investor expectations on the rise, converging with mass psychology, could artificially pump up Bitcoin via a continuous positive feedback loop of buyer optimism.

Commenting on the Elliot Wave itself, on an exponential advance over nearly three years up to the current all-time high of USD 20,000 in December 2017, he says:

“There are several ways to interpret the structure of wave ⑤, each with different consequences. First though, let’s look at the move from the end of wave ④ to the ~$20,000 peak. It is difficult to count the intermediate and minor subwaves because there are so many that could qualify. I count no less than 15. Clearly there are extensions and extensions within extensions at play (we touched on extensions here). Luckily, we don’t have to know the correct count of wave ⑤’s subwaves in order to make some useful conclusions about it.”

He then concludes that a price and target for the end of Wave 1 is around USD 100,000, nearby the year 2020, but warns that “there is no rule that market moves have to be proportional”. Meaning to say, the pattern unfolding could even fail to continue, and that these estimates are based on data from a distant past.

Meanwhile, miners around the world seem to be gearing up for such a scenario. A major crypto mining firm, Riot Blockchain, is one, with its announcement today confirming the purchase of an additional 1,000 next-generation Bitmain S17-Pro Antminers. This latest buy concludes its extension of its Oklahoma City mining facility, and comes fresh after the initial buy of 3,000 units.

Bitmain is the manufacturer behind these specialized mining rigs, which apparently are about 50% more efficient than the current generation of rigs used by Riot, the S9 Antminers. Once operational, it is expected that the firm’s hash rate generation will exceed its current one by 440%, while consuming only 220% of the electricity, meaning a rough doubling of efficiency.

One of the major miners, Riot was responsible for mining more than 1,820 Bitcoins in the last quarter alone, recording gross profit margins of 14%, but without accounting for depreciation and amortization. At today’s price this means a rough USD 13.22 million gross profit for them. With an estimated cost price of USD 1,350 per S17-Pro Antminer rig, the single quarter alone has more than paid off the investment, leaving USD 7.8 in gross profits left to calculate.

If all goes to plan, and with a full utilization of the Oklahoma City facility’s available power supply of12-megawatt feeding the 4,000 new miners, Riot is confident of accounting for about 248 petahash (248 quadrillion hashes) per second.

Riot Blockchain may even grow bigger if its regulated crypto exchange, announced in April, could materialize. But as no news has emerged yet, and more than 5 months gone since its supposed launch, that doesn’t seem likely right now.

Bullish news for the weekend. Keep and eye on Bitcoin.

 

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