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.
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.
