1. Hash power war = big guys subsidizing miners

In the hash rate war, ABC and SV burned money from BCH, but this money was not burned in vain, but was equivalent to subsidies from the big guys to the miners. If these hash rates are not used for mining on BCH, they will not be idle, but will continue to mine on BTC .

The result of the hash rate war is that the difficulty of BTC mining has decreased and the income of miners has increased. The difficulty has decreased by 7.39% in the last cycle, and it is expected to decrease by 7.4% in the next cycle, which is equivalent to a cumulative increase of 15% in mining output. If the electricity cost of miners before S9 accounted for 70%, it means that the net income of mining has increased by 50% .

So cheer for the hash rate war. The longer the hash rate war lasts, the more subsidies the big guys will give to the miners.

2. The big players in the hash rate war all use their own hash rate

Currently, there is no mining pool that uses computing power to mine BCH without the consent of miners . Bitmain uses its own computing power to mine BCH. From https://pool.lol, we can see that except for BTC.TOP, all mining tasks issued by mining pools are to mine BTC. As we all know, BTC.TOP has been a machine gun pool since the first day of the pool opening on January 1, 2014 (at that time it was LTC1BTC.com), and it will switch computing power between BTC & BCH for mining.

Of course, according to the first point, miners should encourage the big guys to use their computing power to fight. After all, miners can collect BTC normally, and they have no losses, but they can increase their mining income . However, CSW threatened to sue Bitmain if Bitmain used the user's computing power, so this road is not feasible, which is a pity.

3. Market sentiment is not desperate enough

I have said in many lectures and live broadcasts before that the bear market is still going on and the market sentiment is not desperate yet . It is expected that the bottom may not be reached until the Spring Festival of 2019. Whether it has bottomed out or not depends on the market sentiment at that time.

4. A bear market that lasts a long time will inevitably fall

Because of 3, a bear market that has been sideways for a long time will inevitably fall. In early November, due to the long period of no fall, market sentiment began to stir again. For example, TDxths (a retail technical indicator analysis KOL active in Babbitt) analyzed on Weibo:

I feel that the price of the currency is in danger. As to why this theory of empirical induction and even the entire theory of technical indicator analysis are wrong, this is a problem of cognitive level . Xu Zhe’s "Finding a unique combination of technical indicators to form my own trading system, which was also my dream" is very well written.

The only way to make money in short-term cryptocurrency trading is not to predict the price of the currency, but to take advantage of other people's emotional errors . It is impossible for anyone to achieve a long-term opening win rate of >50%. The only source of profit comes from losing less when 50% is wrong and winning more when 50% is right. The characteristics of retail investors are that they stop profit early when 50% is profitable and hold on to it when 50% is losing, so they lose money. Short-term cryptocurrency trading is a zero-sum game. Your only source of profit is to do the opposite of retail investors and eat up the losses caused by retail investors' emotional errors .

5. The reasons for this decline & the principle of anti-fragility

I have strayed off topic. Let’s get back to this volatility. Someone previously pretended to be Wu Jihan and I have already refuted the rumor.

The fundamental reason for this decline is that a long-term bear market is bound to fall, and the direct reason is that there was an error in OK's futures system, which caused a large number of automatic quantitative programs to smash the spot market and triggered the existing bear market panic.

Although mining may seem like a bunch of machines roaring, the essence of mining is not industrial production, but finance . Anyone who wants to do mining well must realize that mining is a financial behavior.

As for financial behavior, first of all, it is necessary to be anti-fragile. Anti-fragility means making money when a black swan occurs, rather than losing money. Xu Zhe's articles are also used as teaching materials, "Two Choices for Each Market Participant" and "Bubble and Anti-Fragility".

The principles of speculation in the secondary market are exactly the same. In my opinion, they can be roughly divided into two categories:
(i) Strategies that make money when the market behaves in a way that is consistent with “statistical phenomena” and everything is normal (ii) Strategies that make money when the market is extremely abnormal and something bizarre happens that everyone exclaims

Therefore, miners should hedge in a bear market so that they can make money instead of losing money when there is an unexpected crash.

I have already put the watermark: Those who scold miners for opening short positions in a bear market are idiots:)