Andre Dragosch, European Head of Analysis at Bitwise printed a collection of charts on X to elucidate why Bitcoin is making new all time highs.
1/ Optimistic Seasonality.
Bitcoin was poised to go up in November from a pure seasonality perspective. November has traditionally been one of the best efficiency month for Bitcoin. This fall is usually an excellent quarter for Bitcoin.
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2/ US elections.
Though there have been clearly nuances between each Harris and Trump, bitcoin would in all probability have rallied whatever the election final result primarily based on previous US election cycles. That being stated, the decline in US regulatory uncertainty, pro-crypto US steadiness of energy, and the BTC strategic reserve narrative are all going to speed up the mainstream adoption of Bitcoin & crypto property going ahead.
3/ The availability shock is right here and it’s actual. There’s rising proof that the BTC provide shock has actually been intensifying these days. As an illustration, measures of liquid + extremely liquid BTC provide supplied by @glassnode have reached a brand new year-to-low whereas measures of illiquid provide have reached a brand new all-time excessive. In different phrases, there have by no means been extra bitcoins deemed as “illiquid”.
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4/ US spot Bitcoin ETF demand is exacerbating the provision shock. The availability shock emanating from the Halving is even exacerbated by the demand overhang coming from US spot Bitcoin ETFs. Since buying and selling launch in Jan 2024, web flows into US spot Bitcoin ETFs have been 2.5 x increased than the speed of BTC manufacturing in the identical interval. This issue has just lately even elevated. Over the previous 5 buying and selling days, ETF demand has outsized provide by an element of 12.Three x.
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5/ Danger of a brief pull-back as a result of excessive sentiment = might create a beautiful entry level. To be sincere, many institutional buyers in Europe have been shocked by the very constructive response of cryptoassets to the US election final result. What’s extra is that a big half nonetheless stays underexposed however more and more desires to realize publicity. The reality is that there’s a heightened danger for a brief pull again as our Cryptoasset Sentiment Index has just lately reached to a 3-year excessive signalling euphoric sentiment & skewed one-sided positioning already. Nonetheless, a brief pull-back ought to be used to extend or achieve publicity in what’s going to most-likely be the primary a part of the bull market.
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