Bitcoin Market Update
By Greg Cipolaro, Global Head of Research, NYDIG
- The second quarter was a tough one, as it was bitcoin’s weakest 2Q ever and one of its weakest quarters since 2011.
- Putting the second quarter in context is critical, though, as bitcoin just came off 4 consecutive quarters of stellar performance.
- Even after the tough 2Q, bitcoin is still up over 19% year-to-date, making it one of the best-performing assets of 2021.
- Headlines dominated the quarter, including Tesla’s about-face, China’s crackdown, El Salvador’s adoption, Taproot activation, and numerous banks & banking partners gearing up to enable client access to bitcoin.
- China’s push on mining resulted in precipitous drops in network hash rate and electricity consumption, but the network continues to operate as expected. We believe Bitcoin will be in a better place in the long term.
- Although it is a noisy metric, bitcoin dominance is back on the rise after ceding ground during the rally in alts earlier in the quarter.
- With 2Q behind us, there is much to look forward to, including continuing adoption by institutions, activation of millions of traditional banking customers with the ability to buy bitcoin, and foundational technology upgrades.
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