Ki Young Ju founded CryptoQuant, an analytics platform for crypto currencies. predicts Bitcoin is a serious problem “sell-side liquidity crisis” In the meantime, next six months. The founder believes that in this case, not only would prices rise to levels beyond expectations but also the market will be disrupted.
Bitcoin Records All-Time Highs
Bitcoin prices are trading around their new record highs, following a dramatic price increase on 11 March. Coin roared at new record highs to reach $72,800, before cooling down to spot prices.
Although the upward trend has been weakened, as prices have moved horizontally in writing, it still remains. In this way, many traders believe that BTC will ease up above yesterday’s highest levels as bulls continue to target $100,000. Technical and fundamental analysts believe that if bulls surpass this psychological level, it could be an important inflection for Bitcoin.
Bitcoin is expected to skyrocket in price, according to the founder next Two factors are primarily responsible for the six-month delay. Ju points out that the first factor is the huge influx of institutional demand via Bitcoin spot exchange traded funds.ETFs). Analysts have so far linked Bitcoin’s current surge to the demand of institutions.
Ju noted a net influx of BTC over 30,000 last week. It means institutions are removing coins at an unprecedented rate, which is contributing to the scarcity. Spot ETFs allow institutions and wealthy individuals to gain exposure without having to own BTC directly.
The concern is the small number of coins that are held by centralized exchanges, and other known entities. This includes miners. According to the founder, exchanges and mining companies hold a combined total of 1 billion coins. own About 3 million BTC. Ju says in his post that the United States has 1.5 million BTC.
BTC Crisis to be Expected
The founder points out that a combination of a rising supply, and an increasing demand for ETFs on the spot market will result in a “sell-side liquidity crisis” In six months. The scenario described above could result in a shortage of sellers who can meet high demand from buyers, which would further increase prices.
Bitcoin’s network is reducing miner reward by 50% in April, from its current 6,125 BTC. BTC emissions will fall, resulting in a smaller amount of coins being released, which will further worsen the situation.
The expected scarcity crises may cause the market to be disrupted, and coin owners will benefit, if institutions keep up their current demand.
Chart from TradingView, with a feature image by DALLE
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