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April 13, 2021
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Analysis: Bitcoin could break $ 60,000 soon

Has the Bitcoin market peaked while traders constantly fail to achieve a breakthrough movement above $ 60,000? Apparently no.

According to Ki-Young Ju, the CEO of CrypoQuant – a blockchain analytics company based in South Korea, Bitcoin has every reason to break through the $ 60,000. The analyst cited a reason behind his positive opinion of the main cryptocurrency: declining bitcoin is balanced across all crypto exchanges.

Bitcoin exiting exchanges

CryptoQuant tracks the number of exchanges that have bitcoins in their wallets. When traders deposit their BTCs in the exchange portfolios, the company considers that they do so to exchange them for other crypted assets or to discard them entirely to withdraw.

On the other hand, when traders withdraw their BTCs from exchanges, CryptoQuant says it shows their willingness to keep the tokens.

Mr. Young looked at the relationship between Bitcoin’s peak price and the number of bitcoin entering the exchanges in January 2018. The month saw the BTC / USD exchange rate reaching almost $ 20,000. Its rise coincided with a peak in BTC entries on all operational cryptocurrency exchanges at that time. The pair later dropped to $ 3,100 in December 2018.

On the other hand, when traders withdraw their BTCs from the exchanges, CryptoQuant says it shows its willingness to keep the tokens.

Mr. Young looked at the relationship between the peak price of Bitcoin and the number of incoming bitcoin in the exchanges mentioning January 2018. The month saw the BTC / USD exchange rate reaching almost $ 20,000. Its rise coincided with a peak in BTC entries on all operational cryptocurrency exchanges at that time. The pair later dropped to $ 3,100 in December 2018.

However, the factors surrounding April 2021 are totally different. Instead of incoming bitcoin, the outflow is increasing across all exchanges. This shows the “HODL” mentality, although Bitcoin’s price is trading close to its previous peak level of $ 61,778 (Coinbase data). Traders don’t want to realize their profits yet, the data shows.

“When the market reaches its peak, everyone deposits BTC on exchanges to sell,” wrote Mr. Young. “The number of inbound addresses on all exchanges reached its highest level in January 2018, while reaching a three-year low a few days ago. People are holding, not selling. “

Why holdar?

Data analyst Glassnode noted last month that the total number of BTCs in circulation is currently no more than 4 million. This is decreasing with each passing month, which could lead to a supply crisis as Bitcoin demand continues to grow, thanks to the lack of attractive investment alternatives elsewhere.

After Bitcoin’s third halving last year – a periodically occurring event that cuts BTC supply in half, institutions have increased their stakes on this a lot. That’s because they fear a dramatic spike in inflation caused by the Federal Reserve’s near-zero interest rate policy, its unlimited bond-buying program (which keeps yields lower) and the trillions of dollars in US government stimulus packages. .

With most fundamentals still intact, Bitcoin traders apprehensively decided to wait for the real institutional boom, especially after Tesla, MicroStrategy, Square, PayPal, Mastercard, Visa, Morgan Stanley and Goldman Sachs decided to offer and invest in bitcoin.

Source: Bitcoinist

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