Data from Bybt, a cryptocurrency futures trading & information platform, reveals that a total of 57,000 BTC was acquired from centralized exchanges in 24 hours. Using the current price of Bitcoin which stands at $40,100, puts the value at approximately $2.3 billion.
What you should know
- Bitcoin has appreciated over 35% in a week after trading a low of $29,000 last week as a result of a short squeeze in the flagship cryptocurrency, to currently trade around the $40,000 trading zone.
- The acquisition indicates that both HNI’s (High Net worth Individuals) and institutional investors are very much interested in getting more exposure in Bitcoin despite regulatory and volatility concerns.
- The current exchange balance is now at the level it was before the May 2021 crash, when Bitcoin tumbled from its all-time high, losing nearly 50% of its value.
- Despite this demand, market participants believe that there is a need for a higher low construction on BTC/USD before any higher price levels could be attained.
- Order book data from Binance, the largest centralized exchange by volume, reveal that there is a narrowing range for spot price, with buyers and sellers encroaching on $40,000 from both sides. This indicates that spot traders are beginning to accept the new price reality for Bitcoin.
Bottomline
Bitcoin has been struggling to break through the $40,000 trading zone as it is met with strong resistance from the bears who are not allowing the price to break through this zone. Although with demand for Bitcoin rising and confidence being restored into the market, Bitcoin will likely break this zone which would be a very strong indication for the continuation of the bull run.
With more accumulations of this magnitude, another supply squeeze is likely to happen, thereby pushing the price higher. Investors are however advised to be cautious when investing as cryptocurrencies are volatile asset classes. The dollar-cost averaging technique is the advised approach before investing.