While Bitcoin entered a sharp correction on Monday, December 21, its 200-week moving average shows that it continues to build strength every passing week. Bitcoin analyst and author of stock-to-flow (S2F) model – PlanB – shows that the 200-WMA (at $7700) is surging faster than expected at 6.5% per month.
#bitcoin 200WMA increasing faster and faster pic.twitter.com/Gqr48XSU1q
— PlanB (@100trillionUSD) December 21, 2020
MicroStrategy CEO Michael Saylor was quick to respond to it. In a tweet, he noted:
Trending Stories
“Bitcoin (BTC) is like a battery charged with monetary energy. Since a rational investment time horizon is ~4 years, as long as the price is trading above the 200 week moving average (200WMA), the network is powering up. The more intensely it trades, the faster absorbs energy”.
On Monday, Bitcoin (BTC) entered a sharp correction taking a dip below $22,000 before recovering back above $22,700 levels. Well, guess what who made the most of the dip? Michael Saylor’s MicroStrategy pumped a whopping $650 million into Bitcoins buying at $21,925 levels. The investment comes just at a time when JPMorgan strategists noted that institutional inflows in Bitcoin funds are essential to keep its momentum going.
At press time, BTC is trading at a price of $22,898 with a market cap of $423 billion. Despite Monday’s correction, BTC is up over 16% on weekly charts. Other indicators like the BTC supply and liquidity crunch also hint at a bullish momentum ahead.
Bitcoin (BTC) Facing Supply and Liquidity Shortage
Glassnode CTO Rafael Schultze Kraft presents some interesting on-chain indicators explaining the supply and liquidity crisis in Bitcoin (BTC) and why he is extremely bullish.
#Bitcoin is in a supply and liquidity crisis.
This is extremely bullish! And highly underrated.
I believe we will see this significantly reflected in Bitcoin's price in the upcoming months.
Let's take a look at the data.
A thread ???????????? pic.twitter.com/vx6rJmiloE
— Rafael Schultze-Kraft (@n3ocortex) December 21, 2020
Let’s look at some of the exciting data that Rafal presents.
- True Bitcoin (BTC) HODLers are currently holding 14.5% of the total supply. The total Bitcoins (BTC) he’s in accumulation addresses is 2.7M. These are addresses that have never spent any Bitcoin, but only received them.
- Although the total supply of Bitcoin is capped at 21 million, nearly 16% of the supply i.e. 3M are lost coins. Thus, the actual availability of BTC is lesser than the total coins.
- Institutional demand continues to spike on a month-on-month basis.
- Since Bitcoin halving in May 2020, nearly 185,000 BTC have been mined. On the other hand, Grayscale purchased 210,000 BTC during the same period. Meaning they purchased more than the BTC issued.
- As we know, Bitcoin (BTC) liquidity has been quickly vanishing from the exchanges. Most of it is likely going to cold storage after massive institutional Bitcoin OTC deals in the last few months.
- 14.4M BTC is held by illiquid entities – that is 78% (!) of the current supply. Illiquid entities act as supply sinks since they spend less than 25% of the Bitcoins they receive.
- Interestingly, Rafael also points out that miners have yet not resorted to profit-boking in the recent bull run. Instead, the miner unspent supply continues to increase since the last halving. The current miner balance is 1.7 million BTC.
This exciting data presented by the Glassnode CTO clearly hints that bullish momentum is certainly building and Bitcoin (BTC) still has a lot of steam in it before starting any downward journey.
- Institutional Traders Are Shorting Bitcoin At Record Pace, Here’s Why
- Lido Shut Down Terra Support, Starts bLUNA And stLUNA Withdrawal
- This Whale Adds 787 More Bitcoins As Price Struggles
- After Vauld Suspends Withdrawals, These Crypto Exchanges Could Be Next
- Cardano’s Vasil Upgrade Goes Live On Testnet; When Will It Be Lauching On Mainnet?
- How Stable Is Tether? Data Shows USDT At Massive Liquidity Imbalance
- As BTC Plummets to $19,000, Elon Musk’s Tesla Reports $440 Million Impairment Losses
- British Army Regains Control Of Their Hacked Social Media Accounts Promoting Crypto Scams
- Bitcoin Miners Likely Behind Crash Below $19K, Here’s Why
- India’s Crypto Exchanges In Trouble? 1% Tax Keeps Traders Away
- Cardano price Analysis: ADA Price Nearing Triangle Breakout Eyes $0.655
- Polygon Price Analysis: $0.45 Fallout could Plummet MATIC price by 25%
- ETH Price Analysis: Can $1000 Support Undermine Selling Momentum?
- BTC Price Analysis: Technical Indicator hints Upcoming recovery for Bitcoin
- CRV Price Analysis: Buyers Prepare To Boost CRV Prices To $1
- DOGE Price Analysis: Pullback Opportunity Eyes its Next Jump to $0.1
- Sandbox Price Analysis: Emerging Pattern May Soar SAND price by 20%
- Polygon Price Analysis: V-top Reversal may Direct MATIC to $0.31 Support
- ETH Price Analysis: Is Ethereum Dropping To Three Digits?
- Bitcoin Price Analysis- BTC on Losing Streak Nearing $17800; Will it Hold?
