Although the price of Bitcoin is currently struggling to maintain the psychologically important mark of $40,000, demand from institutional investors remains high. Is this constellation perhaps the last opportunity to buy low-priced Bitcoin (BTC)?
In any case, Ki Young Ju, the general manager of the CryptoQuant analysis service, is the one conviction, institutions’ continued investments in bitcoin will continue to be the dominant narrative in the coming weeks, as they will only further tighten the available supply. A rise in prices is likely to occur despite poor macroeconomic conditions.
supply shortage
In this context, Ki refers to the latest data from Coinbase Pro, the professional offshoot of the American crypto exchange Coinbase, as considerable capital movements have recently been shown here.
30,000 BTC was bought in a single day this week alone, an event that has become more and more the norm since March.
“Today alone, 30,000 BTC flew from Coinbase,” as Ki notes accordingly. To this end, he states:
“Buying by institutional investors is likely to be the big topic again in the coming weeks, as the executive order has had no real impact.”
The expert is thus referring to an ongoing executive order by US President Joe Biden, which explicitly targets the crypto industry, but does not seem to prevent large investors from continuing to invest heavily in the market.
As Cointelegraph reported, this trend is being felt on crypto trading platforms, with April on track to catch up with March in this regard.
Due to the large outflow of capital from trading platforms, the existing supply is shrinking, which is expected to push the Bitcoin price up again in the medium term. Such a boost would be badly needed, as the macroeconomic situation is currently exerting significant downward pressure.
Ideally, strong demand from institutional investors could cause the correlation between BTC and the stock market to be weakened or even dissolved, as the latter comes under heavy pressure, including from central bank monetary policy. .
“The correlation will break down eventually, for a number of reasons,” according to crypto expert Dylan LeClair. To which he adds:
“My hypothesis: the financial system is collapsing and volatility is exploding. BTC is catching up, but only through derivatives trading, not the spot market. Bears, conditioned to sell any downturn, will be looking up in the medium term as the spot market becomes increasingly stretched. »
Terra continues to generate demand
The Terra (LUNA) crypto project is currently actively contributing to this shortage, as in the last 48 hours alone, the Luna Foundation Guard (LFG), which is responsible for securing the company’s own stablecoin, received 2,633 BTC additional ones worth 105, Bought for $3 million.
According to data from BitInfoCharts, the crypto project’s wallet now ranks 18th among all Bitcoin wallets, already holding more BTC than influential electric car maker Tesla.
The opportunities to buy bitcoins are therefore rapidly diminishing, which is good news for all existing investors, as the increasing scarcity will continue to push the price up in the long term.
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