Bitcoin is one of the first cryptocurrencies and the most popular one even in 2022. It is a decentralized blockchain-based peer-to-peer transfer protocol that makes global payment easier and more secure.
Many governments are encouraged to switch to renewable energy sources as an alternative to coal mining. As a result, it also affects cryptocurrency because some cryptocurrencies, such as Bitcoin and Ethereum, take more energy to mine and operate their systems. On the other hand, some popular cryptocurrencies like Cardano and Polkadot use less energy for their systems.
Now investors understand that Bitcoin produces more pollutants. Thus, they may show a lack of interest in the future if the developers do not change the operating system.
Ethereum 2.0 upgrade will switch from Proof of Work consensus to Proof of Stake consensus. Bitcoin uses Proof of Work consensus, which consumes an entire country’s energy.
Miners have to solve complicated mathematical transactions to mine new coins in the system. It uses the same electricity as a country like Sri Lanka or the Netherlands.
Many financial advisors suggest buying Bitcoin, but you have to think about the long-term effect of a decentralized’ cryptocurrency before investing your hard-earned money. Traders should explore Bitcoin price prediction before coming to any conclusions.
At the time of writing, BTC was trading around $29,552. It has been consolidating between $28K and $31K. However, if it breaks the upper level, it will face a strong resistance of $37K.
Although BTC is fundamentally a strong cryptocurrency, it faces problems due to higher energy consumption and scalability. Many investors may show a lack of interest in Bitcoin and more interest in Ethereum.
However, $29K is a strong support level for this cryptocurrency, and it is tough to tell where it will take another support if it breaks this level.
On the weekly chart, it is clear that $29K is an important level, and if it breaks, we can say that Bitcoin is in a bear’s grip. Although the BTC price is forming higher lows with support around $29K, we do not think it is the ideal time for long-term investment.
You can take the benefits of this consolidation period by investing for the short term. It is a good time for accumulation so that if BTC goes down, you can invest further for the long term. Besides that, you have to read the fundamentals of Bitcoin.
Crypto markets are in a global change. Many governments force regulations on cryptocurrencies, whereas developers face issues with energy consumption and scalability.