Wednesday, December 8

Markets to date: after a new historical peak of bitcoin the accumulation is maintained


Key facts:
  • BTC continues to come off exchanges, unlike in the 2017 rally.

  • Long-term holders have only sold 7.3% of their BTC, since the October 20 high.

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Bitcoin (BTC) reached a new all-time high of $ 68,641 on Tuesday, November 9, and yet long-term holders show very little tendency to sell, which marks an important difference from the bullish rally of 2017-2018. As highlighted by CriptoNoticias, this week’s all-time high coincided with a minimum level of BTC balance on exchanges.

In addition to several factors that had driven the price to maximum values, commented by this means on Monday 8, such as the fall in bond yields and world inflation, among other factors, the supply shock was added to contribute to the new high of last Tuesday.

The rally 2017 was marked by speculative movements that were reflected in an intensive period of sales, while in the current cycle the flow of BTC leaving the exchanges is maintained, despite the recent highs in the price. There are currently around 2.4 million BTC on exchanges, as seen in the graph below.

There is 22% less BTC on exchanges than in March 2020. Source: Glassnode.

This decline in BTC available in the market suggests that holders “with strong hands”, or with little willingness to sell, have expectations that the bull cycle is still in place.

After registering another all-time high of USD 68,543, this past Thursday, the price of bitcoin entered a sharp correction phase, which was attributed to the movement of 2,207 BTC from one direction that remained inactive for more than 8 years. This movement caused a 6% drop in the price, which was reported by this medium. Since then the price has been lateralizing with a downward trend and is, at the time of writing this article, at USD 65,990, as can be seen in the CryptoNews Price Calculator.

Bitcoin accumulation continues at highs

In coincidence with the outgoing flows of BTC from exchanges, long-term holders (LTH) continue to retain the acquired coins, as they register a low percentage of sales.

According to a Glassnode report commented on by CriptoNoticias last Friday, November 12, LTHs have sold only 7.3% of the BTC they had at a time when the price exceeded $ 66,000, on October 20. On that date, the highest value of BTC held by LTHs occurred, 81.5% of the bitcoin supply.

Long-term Holders have little tendency to sell their BTC. Source: Glassnode.

Bitcoin on the heels of silver

Bitcoin, which remains in the eighth position among the most valuable assets in the world, is closer to the market capitalization of silver, according to an analysis carried out by CriptoNoticias this Monday, November 8. With a market value of $ 1.21 trillion, the first cryptocurrency is 18% away from matching the second precious metal, which has a capitalization of $ 1.43 trillion.

To meet that goal, the price of bitcoin should exceed $ 73,000. The progress of bitcoin with respect to silver has been remarkable this year, because just in February, its value was 60% of the value of silver and today it is 84.6%.

Featured chart of the week

The relationship between bitcoin’s market capitalization and its effective capitalization gives rise to the MVRV metric. This is defined by assigning the BTC of a bitcoin address the price that they had in their last movement. The effective capitalization is less than the conventional one because the weight is reduced to the currencies that have not been moved in a long time.

The highs of the MVRV curve coincide with the all-time highs of the bitcoin price. There is a more striking detail, however, and that is when MVRV exceeds the value 3, which happened recently. Historically, when this metric has reached that value, the price of bitcoin has entered a parabolic phase of growth of variable duration, but that can be several months.

Grayscale’s foray into ETFs would challenge the largest exchange-traded fund in gold

As has been highlighted in this publication, there are important differences between ETFs backed by bitcoin, such as those approved in Canada at the beginning of the year, and those launched in October in the United States, which are based on bitcoin futures contracts.

Investment company Grayscale, manager of the largest bitcoin fund, awaits SEC approval to convert this investment vehicle into an ETF, along with other cryptocurrency investment funds totaling more than $ 60 billion. The total assets under management of these Grayscale funds currently rival the largest gold ETF, the SPDR Gold Shares, with assets under management of $ 58 billion, according to an analysis conducted by this outlet.

$ 8.9 billion invested in bitcoin funds in 2021

So far this year, almost USD 9,000 million have been invested in various bitcoin funds and other cryptocurrencies, according to a study by CoinShares, commented by CriptoNoticias this Wednesday, November 10. With the investment so far, All institutional investment in cryptocurrency funds made in 2020 has already been exceeded by 39%. If the same rhythm of investment towards cryptocurrencies is maintained, the total flow in 2021 would be about USD 10,600, which would exceed the previous year by more than 66%.

How will bitcoin price at the end of the year? PlanB sees a 60% boom

Among the various bitcoin price prediction models the so-called

Stock To Flow (S2F) or reserves to flow causes controversy among followers and those who emphatically reject it on Twitter and other social networks.

The model, released by the enigmatic analyst PlanB, predicts that bitcoin will surpass $ 90,000 by the end of the year. So far, the evolution of the price of bitcoin has followed the staggered pattern of this analyst quite tightly, as seen in the graph. The outlook looks auspicious as the emblematic mark of USD 100,000 would be surpassed in the vicinity of the new year.



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