China's Crackdown on Bitcoin Mining Is Good News for North American Crypto Miners
Bitcoin erased its 2021 gains last week as China ramped up its crackdown on mining of the cryptocurrency, a move that’s expected to help shift the industry’s center of gravity from Asia to North America.
Meanwhile, the Bitcoin price formed a death cross last Monday, with the 50-day moving average trading below the 200-day moving average (MA). This technical pattern is often seen as a bearish sign of things to come, but that may not be the case with Bitcoin.
Bitcoin death crosses have not historically been consistent downside price predictors. Take a look at the chart below, shared in a Tweet by CoinShares. The digital asset investing firm analyzed Bitcoin’s price action one, three, six and 12 months following previous death crosses, and no pattern emerged suggesting that a sustained bear market was triggered when the 50-day MA dipped below the 200-day.
If anything, the chart shows that your chances of being rewarded improved the longer you held. A death cross occurred in March 2020, and had you held for a year, you could have seen returns as high as 450%, according to CoinShares.