{"id":465405,"date":"2021-06-10T16:53:28","date_gmt":"2021-06-10T16:53:28","guid":{"rendered":"https:\/\/uniquehot.com\/?p=465405"},"modified":"2024-06-11T13:56:18","modified_gmt":"2024-06-11T13:56:18","slug":"institutions-bitcoin-digital-gold","status":"publish","type":"post","link":"https:\/\/uniquehot.com\/news\/institutions-bitcoin-digital-gold\/","title":{"rendered":"Are Institutions Already Over The Bitcoin Digital Gold Narrative?"},"content":{"rendered":"

Bitcoin trades at $36,786 and records profits in the 7-day chart, after two consecutive weeks of losses. In the 30-day chart, BTC still has a 32.3% loss. The price action painfully moves higher in the current range, but without conviction from the bulls.<\/a><\/p>\n

\"Bitcoin
BTC trends downwards in the daily chart. Source: BTCUSD Tradingview<\/a><\/figcaption><\/figure>\n

The crypto market seems to be stagnated after BTC\u2019s price crash. The battle has been fought by short-term holders selling their coins to long-term holders, but institutions have been mostly absent during the correction.<\/p>\n

Data<\/a> from CryptoQuant suggest institutional demand for the Grayscale Bitcoin Trust (GBTC) and the Bitcoin Fund launch in Canada by investment fund manager 3iQ is decreasing.<\/p>\n

As seen below, the GBTC has seen a negative premium and has been trading at a discount since March 2021<\/a>. This caused discomfort and concern from their clients and Grayscale\u2019s parent company, Digital Currency Group, was forced to intervene. The company had to buy several million in GBTC shares.<\/p>\n

\"Bitcoin
Source: CryptoQuant<\/figcaption><\/figure>\n

Unlike the Canadian QBTC, the GBTC has been holding its Bitcoin. The QBTC reduced its holdings to 7,980 BTC at the beginning of June<\/a>. Thus, creating selling pressure in the crypto market, as seen below.<\/p>\n

\"Bitcoin
Source: CryptoQuant<\/figcaption><\/figure>\n

The general sentiment in the market has been negative, despite the news of the adoption by nation-states. At the start of the current week, BTC\u2019s price<\/a> saw some positive development. This coincides with a decrease in GBTC discount from 12% to 7%.<\/p>\n

\"BTC
Source: Glassnode<\/figcaption><\/figure>\n

As Lex Moskovski, CIO at Moskvski Capital, shown in the last 2 days, the number of addresses accumulating BTC saw a leg up after a period of consolidation. However, the selling pressure has not decreased, as the increase in BTC inflows to exchanges suggests.<\/p>\n

\"Bitcoin
Source: Glassnode via Lex Moskovski<\/figcaption><\/figure>\n

Will Bitcoin Bulls Managed To Push The Bears Back?<\/h2>\n

At the moment, Bitcoin\u2019s price could still be dominated by uncertainty and no clear direction. As a report by QCP Capital states the BTC sell-off has been \u201cdeeper and sharper\u201d than expected.<\/p>\n

\"BTC
Source: QCP Capital<\/figcaption><\/figure>\n

The sell-off has come in 3 waves since the beginning of May. The market could see another sell-off, but in the form of consolidation as the firm claims:<\/p>\n

it looks like BTC is setting a bottom for the Wave 4 rally higher. This Wave 4 however will most likely be a slow steady consolidation grind.<\/p><\/blockquote>\n

Bitcoin has two challenges in the short term, it must flip $38,000 from resistance to support and must overcome the \u201cformidable\u201d wall at $40,000. Bitcoin thesis as a store of value seems to be invalidated in the short term, as the low institutional participation suggests. Therefore, there is less demand for the cryptocurrency.<\/p>\n

(\u2026) all three of the bull cases for BTC have been invalidated, and it’s hard to make a bullish fundamental argument to buy BTC right now. we continue to expect the downtrend to persist and for the market to be on sell rallies mode in the near-term at least, and if Wave 4 does extend past $40k we expect the $50k to have even larger selling supply.<\/p><\/blockquote>\n

QCP Capital expects the Consumer Price Index (CPI) print and the Federal Open Market Committee (FOMC) meeting to be risk factors for BTC\u2019s price in the short term.<\/p>\n

it was the CPI print last month, coupled with a confluence of some other factors, that started the big BTC decoupling.<\/p><\/blockquote>\n

The firm sees potential for the price to drop below $30,000 and expects $20,000 to be strong support if this scenario materializes.<\/p>\n

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11\/ BTC price looks likely to remain capped till year end. Market seems to have settled somewhere in between downside fear and a wait and see approach. Retail volumes have thinned out and movements from whales are dominating the price action<\/p>\n

— QCP (@QCPgroup) June 9, 2021<\/a><\/p><\/blockquote>\n