Bitcoin has seen an extremely strong rally over the past few weeks and months that has brought the coin from $ 10,000 to $ 24,000. The leading cryptocurrency is currently trading for $ 23,900 after a slight correction.
Analysts say there is a „perfect storm“ of demand trends for The News Spy that made this extremely strong rally possible.
Bitcoin’s rally is being driven by major demand trends
BTC is expected to continue moving higher in the medium to long term as these demand trends are expected to continue. This is in line with the expectations of many top analysts that Bitcoin will move into the six-digit range in the next two years.
Cole Garner, an on-chain BTC analyst, writes in an extensive Twitter thread why he thinks BTC demand trends are extremely positive. He writes:
“A perfect storm of demand momentum is driving #Bitcoin price. I think something has shifted in the market – and active investors & traders would do well to change their mindset. After years asleep at the wheel, institutional executives are now roused en masse. If they want this asset, they’ll have to make an effort, compete with the crowd, and run FOMO through ATHs. And that against a background of scarcity that you have never experienced before. „
He believes these institutional players will buy Bitcoin no matter what it costs. This should help price evolution over long periods of time as these players use algos to scale into the market over time.
Garner adds that he thinks the Bitcoin halving was never priced in:
“That’s why the halving was never priced in. That’s why I think #Bitcoin is going to $ 35k- $ 40k ahead of a shakeout that’s way worse than anything we’ve seen before. I’m not saying we teleport to $ 40k right now. Only small profits, pretty much every day, for many weeks. “
Who are the buyers of BTC?
That begs the question of who exactly the buyers are. The short answer: Wall Street. The long answer is a bit more complex.
We are seeing a large inflow of capital from various segments of Wall Street.
For example, MassMutual, a life insurance company, bought $ 100 million in BTC a few weeks ago. According to the company, this commitment is an important part of their entry into the financial part of the digital economy.
There are also companies like MicroStrategy and Square that buy Bitcoin for their balance sheets. The idea is that since the US dollar is rapidly depreciating against other currencies and against assets overall, it makes more sense to own BTC or other assets.