The BTC fear-and-greed index is hovering at 35, so telling you to stay bullish is like asking you to ignore the evidence in front of you. 

A glance at BTC price charts shows pain. Yet, that's only one way to interpret what's happening with Bitcoin.

Fundamental analysis tells a different story; it shows the world is planting seeds that will grow green candles on the BTC charts.

So, fundamentally, where is Bitcoin headed? Let's find out.

TLDR 📃

• Bitcoin's price charts are concerning, but its fundamentals remain strong.
• Despite fear in the market, Bitcoin's real-world problem-solving ability indicates potential for recovery.
• Emerging economies like Argentina and Turkey are turning to Bitcoin to hedge against economic turmoil.
• Strong infrastructure development, institutional and retail interest, and potential real estate use suggest a positive BTC outlook.

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Disclaimer: Not financial or investment advice. Any capital-related decisions you make are your full responsibility.

Bitcoin solves real-world problems 🧮

Bitcoin’s fear and greed index signals market sentiment – values near 0 show Extreme Fear, suggesting investors have oversold irrationally. Values closer to 100 show Extreme Greed, suggesting a market correction around the corner. 

The greed and fear index says people are afraid. Yet, Bitcoin is solving the future’s problems today, and its price will bounce back once the FUD cycle is over.

Argentina may join El Salvador’s Bitcoin party 

Bitcoin is becoming an ace for politicians in emerging economies. In Argentina, a pro-BTC candidate is leading the polls, and Turkey is exploring some opportunities in crypto. 

Both countries have been through economic turmoil; their currencies have suffered massive devaluations, and inflation has reduced purchasing power significantly. 

For the citizens of both countries, Bitcoin has remained the single best hedge against economic volatility. The country, as a collective, also benefits. For instance, El Salvador’s bonds have surged due to jumping into Bitcoin, as we covered in a past report. 

If Argentina’s pro-BTC candidate wins, we will likely get a repeat of El Salvador: widespread adoption and millions of citizens onboarded to BTC. 

BRICS’ gold-backed currency is a pipe dream - but BTC isn’t

Have you heard about the gold-backed currency that the BRICS want to launch? The question is whether or not it can beat the dollar. The short answer? It’s impossible. 

Most of the world’s gold reserves are locked up by the US, and America isn’t selling. There’s simply not enough firepower for a gold-backed currency.

On top of that, the political differences between nations in the alliance make ideas for the currency dead in the water. Who’s going to print it? How can other countries trust the supply is accurate? Would the countries in the alliance let themselves be endlessly audited by their “partners?”

Richard Nixon killed the last gold-backed currency in 1971 because other countries started asking these questions, and the same issues are likely to repeat. The only currency immune to such troubles is the one created with an immutable supply – Bitcoin.

Stronger infrastructure positions BTC stronger than ever

Bitcoin is also booming on the infrastructure side. Mining is now at its most competitive point in Bitcoin’s 14-year history. Not only has the hashrate hit a new all-time high, but it also reached that point so fast this week that the Bitcoin blockchain couldn’t even keep up.

Block times went down from the 10-minute target to 9 minutes and 47 seconds. It took a few days for the chain to self-correct, and now mining a block is more difficult than ever.

The surge in the BTC hashrate might be partly due to the gigantic $1.1 billion investment that the government of Oman just announced. All that money is going to one place: mining BTC.

Investments in infrastructure aren’t easy to exit; it is money spent with a long-term perspective. That long-term view is also likely to drive increased BTC usage among Omani citizens, with the government leading that adoption.

The returns from the $1.1B investment also extend beyond the demand it’ll likely bring. Increasing Bitcoin’s hashrate reduces the centralisation of miners. Therefore, Bitcoin becomes much more resilient to government interference in any geo-economic zone.

Institutions and retail traders remain bullish on BTC 🤑

While the U.S. government continues giving mixed signals, the BTC outlook remains bullish with retail and institutional investors. 

Do you remember the wallet that accumulated about $3.1 billion worth of BTC over the last few months? It turns out it is a retail-powered wallet, not a cash-rich whale. The wallet belongs to Robinhood, making it the third largest after Binance and Bitfinex.

Analysts at JPMorgan say they see “limited downside” due to the decreasing open interest in BTC. Being one of America’s oldest banks, their opinion matters, and it seems they’ve joined the Bitcoin cult, too.

Interestingly, a firm in the Cayman Islands called Ledn is helping people access mortgages while using Bitcoin as collateral. There’s no need to sell any BTC to fund your expenses. You only need to prove that you own enough of it. This means less selling pressure on Bitcoin and potentially more demand as more people use it to purchase real estate.

The U.S. real estate market is worth over $100 trillion. American banks love real estate derivatives (just look at 2008), and now that someone else’s tested the waters, they’re likely to follow suit.

Price analysis 📊

BTC | Bitcoin (1D timeframe)

Charts

What's an easy way to understand whether an asset has formed a bottom or not?

Using the RSI (Relative Strength Index).

We often use this indicator to identify whether an asset is oversold or overbought. Put simply, the asset is oversold if the line is under 30.

We saw Bitcoin dropping way under 30 after the large liquidation from eleven days ago. In retrospect, that was enough selling pressure to cause a bottom, and we believe Bitcoin will continue griding back up to recovery from here.

But check this - the asset is oversold and near support. As a result, this increases the chances of bottoming and heading to the upside, taking the rest of the market to the highs.

Cryptonary’s take 🧠

Bitcoin is getting new investments in infrastructure – making the technology more resilient.  The money pouring in is also long-term focused and is likely to keep building until the pressure blows the top off the volcano. 

While the money and dust settle, we anticipate more dips on the horizon, and we’re keeping cash on hand to capitalise on those opportunities. Patience is key after planting seeds for the future; the green candles will soon be here.

As always, thanks for reading! 🙏

Cryptonary, out!