BITCOIN SERVICES I (OTCMKTS:BTSC) has been under some selling pressure as of late. BTSC got way too hot during the bitcoin craze that sent every stock even remotely related to cryptocurrency or blockchain into atmospheric levels. The stock price touched $0.45 during that time and has shed more than half of that value to now trading around $0.17.
However, the company faces pressure at the $0.24 mark, but if it pushes beyond that it could climb into the 0.30 area. The reason for that is because BTSC, while a total spin of the wheel, still represents an exposure to the bitcoin boom. Investors know this not a long-term investment and they are trying to catch it when it runs and that is it.
BITCOIN SERVICES I (OTCMKTS:BTSC) bills itself as a company engaged in the mining of Bitcoin as well as Blockchain software development. Bitcoin mining is the process by which transactions are verified and added to the public ledger, known as the blockchain, and also the means through which new Bitcoins are released.
According to BTSC press materials, “Our business operations are Internet based to the consumer and consist of two separate streams, as follows: (1) bitcoin mining, and (2) blockchain software development. The principal products and services are the mining of bitcoins, and the development and sale of blockchain software. The market for these services and products is worldwide, and sold and marketed on the Internet.”
BTSC is focused on bitcoin mining which is legal and is accomplished by running SHA256 double round hash verification processes in order to validate Bitcoin transactions and provide the requisite security for the public ledger of the Bitcoin network. The speed at which you mine Bitcoins is measured in hashes per second. The Bitcoin network compensates Bitcoin miners for their effort by releasing bitcoin to those who contribute the needed computational power. This comes in the form of both newly issued bitcoins and from the transaction fees included in the transactions validated when mining bitcoins.
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Yet, BTSC has become harder and harder to predict as the crypto market as a whole has been under immense pressure from potential shutdowns in Asia. China and South Korea account for a considerable volume of bitcoin mining and trading activities. Uncertainties in the two markets goes a long way in triggering a sell-off of companies with stakes in the space.
Since BTSC is tied – death do us part – to Bitcoin, the future of digital currency as a whole here is part of the volatility. The company has not issued any news and I expect they will hold off until the price hits bottom. However, if they have not issued any news after they fell to $0.16 in early December, then I doubt they are going to issue anything soon. But, this has certainly hurt investor confidence as BTSC seems not to be hiding the fact that they are riding the bitcoin wave.
That said, BTSC is going to have to issue some sort of operation outline or business plan on how they offer investors value in blockchain or bitcoin-related services. In addition, the SEC has been circling companies like BTSC, so you may want to be extra careful.
Now holding a market cap of $85.62M, BTSC has decent cash on hand and little liabilities to speak of, but it is not secret what is the catalyst for this company. Investors need to be on point and watch the price of bitcoin with a keen eye. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $BTSC stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $BTSC, either long or short, and we have not been compensated for this article.