Fidelity Chief Explains Why Bitcoin (BTC) Is Cheap At Current Level

bitcoin

Over the last 45 days since July 2022 beginning, Bitcoin and the broader cryptocurrency market have given a strong run-up. As of now, Bitcoin is currently facing resistance at $24,000. Jurrien Timmer, Director of Global Macro at Fidelity believes that Bitcoin is currently “cheap” as per the BTC adoption curve thesis.

Timmer explains that Bitcoin’s price-to-network ratio is currently back at 2014 levels. On the other hand, its network has continued to grow in accordance with the price regression curve.

Courtesy: Fidelity

The Fidelity director further explains: “For me, the main nuance is the slope of the adoption curve. Whether we use the mobile-phone curve or internet curve as proxies, Bitcoin’s price is below its actual and projected network-growth curve. That curve provides a fundamental anchor for Bitcoin’s price”.

Bitcoin and Gold Comparison

The Fidelity chief explains that if Bitcoin were to be compared with Gold, it will be important to see the Bitcoin/Gold ratio. He further adds that the recent sell-off has produced the most oversold conditions in recent years. “Technically, the recent sell-off produced the biggest oversold condition in years (measured as the number of standard deviations from trend),” he said.

One interesting fact that Timmer points out is that the percentage of Bitcoin HODLers is growing considerably. On a 10-year chart, the percentage of Bitcoin HODLers has moved above 13%.

Bitcoin vs Ethereum

Drawing a straight-up comparison between the Bitcoin and Ethereum networks, Timmer points out that the latter has grown at a much faster rate. He also notes that ETH hasn’t got rewarded enough for having a higher price-to-network ratio.

However, Timmer explains that the reason behind ETH not getting enough rewarded is that the Ethereum blockchain is less decentralized as compared to that of Bitcoin’s. He further adds:

“Perhaps some of that will change as ETH goes into its merge. The price analog of Ethereum vs. Bitcoin four years earlier continues to suggest that the crypto winter has come to an end.”

The post Fidelity Chief Explains Why Bitcoin (BTC) Is Cheap At Current Level appeared first on CoinGape.

Share:

Share on facebook
Facebook
Share on twitter
Twitter
Share on pinterest
Pinterest
Share on linkedin
LinkedIn

Follow Us

Most Popular

Get The Latest Updates

Subscribe To Our Weekly Newsletter

No spam, notifications only about new products, updates.
On Key

Related Posts

Bitcoin above 20K AGAIN! Is Bitcoin Price Bullish Today?

The crypto market is moving still in a sideways trend. Trading cryptocurrencies is being favored by crypto enthusiasts rather than simply buying and holding. The reason for this is that consolidation phases are much more predictable thanks to technical analysis. Crypto traders are loving the current crypto dynamics in the market. After Bitcoin fell to

Breaking: Do Kwon Linked 3,313 Bitcoin To Be Seized? S. Korea Deepens Probe

Trouble for Do Kwon, Terra co-founder seems to be increasing after Interpol issued Red Notice against him. In the latest hit, South Korean authorities have moved on to deepen their probe against the alleged crypto fugitive. Do Kwon to lose his Bitcoins? According to reports, South Korean prosecutors are moving… Read more

Bitcoin Skyrockets As Stock Market Crashes, Is It Breaking Correlation

The crypto market is experiencing a surprise bounce. Bitcoin has rallied from the $18K-$19K range to cross the $20K mark. It has increased by over 5% in the last 24 hours and is currently trading at $20.1K.  However, since the stock markets are dumping, Bitcoin looks to break the correlation…. Read more

Bitcoin and Crypto Defy Wall Street Meltdown With Strong Rally

Wall Street started the week in a correction mode with all three top U.S. indices correcting 1% on Monday, September 26. However, Bitcoin and the broader crypto market have made a surprising move northwards with the BTC price shooting past $20,000 levels. With the recent BTC move, more than $14… Read more