Bitcoin Heading for Supply-Side Crisis as BTC Accumulation Increases, Says CryptoQuant CEO
According to Ki Young Ju, the co-founder and CEO of analytics platform CryptoQuant, Bitcoin (BTC) is on track to experience a sell-side liquidity crisis. He believes that Bitcoin bears will not be able to win until there is a halt in the inflow of spot Bitcoin exchange-traded funds (ETFs). Last week alone, spot ETFs saw netflows of +30,000 BTC. Known entities such as exchanges and miners hold approximately 3 million BTC, including 1.5 million BTC held by US entities. At this rate, a sell-side liquidity crisis could occur within the next six months. This crisis may lead to a cyclical top that surpasses expectations due to limited sell-side liquidity and a thin order book. Young Ju suggests that this could happen when accumulation addresses reach a total of around 3 million BTC.
Young Ju also states that the current market is halfway to Bitcoin euphoria. While retail on-chain activities are active, they do not indicate a cyclical top. As Bitcoin is currently in the price discovery phase, it is crucial to determine whether or not it has reached its cyclical top.
Bitcoinโs Current Performance
As of writing, Bitcoin is trading at $71,487. The top-ranked cryptocurrency recently achieved a new all-time high of $72,733 and has seen an increase of over 12% in the past week.
Hot Take: What This Means for Bitcoin Investors
In light of CryptoQuant CEO Ki Young Juโs analysis, it is important for Bitcoin investors to consider the potential implications of a sell-side liquidity crisis and increased BTC accumulation. Here are some key takeaways:
- A sell-side liquidity crisis could lead to a cyclical top in Bitcoinโs price that exceeds expectations due to limited sell-side liquidity and a thin order book.
- If accumulation addresses reach a total of around 3 million BTC, this crisis may occur.
- The current market is halfway to Bitcoin euphoria, indicating that there may still be room for growth.
- Bitcoin is currently in the price discovery phase, so it is essential to closely monitor its performance and determine whether or not it has reached its cyclical top.
As always, it is important for investors to conduct their own research and consider multiple factors before making any investment decisions. Stay informed about the latest developments in the crypto market to make well-informed choices.
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