Bitcoin Price Analysis – Consolidation continues » Brave New Coin

Bitcoin (BTC) has continued to seesaw, sliding 20% since May 6th and then recovering slightly over the past few days. The market cap now stands at US$144.86 billion, with US$1.64 billion traded in the past 24 hours.

On the network side, hash rate and difficulty continue to push record highs, with ongoing shipments of ASICs from multiple mining companies, including Bitmain and Halong. Although the original Bitcoin Whitepaper described Proof of Work (PoW) as “one-CPU-one-vote,” the lead SIA coin developer David Vorick argues that “for any algorithm, there will always be a path that custom hardware engineers can take to beat out general purpose hardware.”

Drastic increases in ASIC usage can have a detrimental long term effect as they increase the likelihood of smaller independent miners being squeezed out of the market. The highest percentage of mining will continue to concentrate in large mining farms, where economies of scale and cheap electricity are available.

Furthermore,…