Bitcoin is up about 10% in the 6 days of the year-end festival but has fallen more than 8% in the last 3 days. With the price currently trading at $ 48,080 at the time of going to press, BTC seems like a pipe dream to close its annual high. Looking back on this turbulent year, however, some things seem to have changed.
Wind and waves until the last moment of the year
As prices test the floor, general retail sentiment appears to have weakened in recent weeks towards the end of the year. Persistent low sentiment is usually positive for the asset and supports a steady uptrend as people remain frustrated and suspicious.
Additionally, both the 7-day and 30-day MVRV have fallen sharply, suggesting that Bitcoin is currently undervalued. However, the short-term turnaround has also sparked some optimism.
The 365 day MVRV has also fallen into negative territory and a slide in Bitcoin towards $ 40,000 would be appropriate in terms of the MVRV. There is still room for growth, however.
With younger coins being issued in the market, the recent drop in prices does not appear to have affected the longer and more experienced hands holding the coins either. In fact, the average age of Bitcoin issued is decreasing.
Source: Will Clemente
Bitcoin’s network gain / loss shows some decline and inflows increase as prices fall. That means that many people panic immediately about the breakdown. This drove the “weak hands” to sell.
It is also possible for participants to adjust the annual returns for tax optimization. However, most sellers are not optimistic about prices going down, believing that prices will be lower in the near future.
On a larger scale, 2021 is a time when institutions are entering the cryptocurrency market primarily to hedge against inflation due to Covid-19. Inflation stories have bolstered BTC’s image as an inflation hedge and store of value as the crypto king is still generating more than 62.56% annual returns.
One worrying short-term sign is the downward trend in whale creatures. Addresses with 100-10,000 coins sell quite a bit. The relative percentage of this seems to make the larger market skeptical of any move.
In addition, the amount of Bitcoin used over the network is decreasing as the volume in circulation has been decreasing every week since November. If the NVT Ratio turns red in the short term, it could mean a drop to $ 42,000.
However, despite the recent decline, the current state of the market, not to buy, not to sell, but HODL supports price ranges in the near future. New retail investors can enter the market once ATH is reached and FOMO is activated next year. For now, however, the price of BTC could continue to hover in a range.
10,000 BTC left Coinbase in just one day
Almost 10,000 bitcoins left the major US exchange Coinbase on December 30, signaling that investor demand is returning to the sector.
Data from on-chain monitoring platform Coinglass reveals that Coinbase’s professional trading arm, Coinbase Pro, lost 9,925 BTC in the 24 hours to the end of the year.
In contrast to bullish or sideways balance sheets on other major exchanges, buying activity often changes trends noticeably in the short term.
Platforms like Binance and OKEx, which were unveiled in the second half of December, saw increasing BTC inflows – something commentators fear could be a sign of a sell-off.
While the BTC bulk sale is still pending, not everyone believes it will continue to do so.
At the same time, the exodus of Chinese users from the Huobi Global exchange could trigger a reorganization of the funds.
Binance rose 840 BTC on Friday, according to Coinglass, while OKEx saw an inflow of 767 BTC. Huobi only lost 158 BTC, but there was 14,044 BTC left as of December, which shows just how big the migration of Chinese users is.
In the monthly timeframe, Binance leads slightly in inflows, currently it has been over 66,000 BTC since the end of November.
However, Coinbase is attracting experts who only have a few hours left until the end of 2021.
“Today the buying activity on Coinbase was pretty uninterrupted,” the famous trader Ryan Clark on Twitter summary.
Bitcoin balance on the exchange as of December 31st | Source: Coinglass
Starting in early January after the holiday season, institutions are expected to return when it comes to owning BTC.
The trading company QCP Capital announced “Reverse” from private investors to institutional investors.
“In 2022, we expect a first shift in crypto ownership from mainly retail companies to institutional players with more participating institutions.”
Such an event would deter big players from worrying about recent price movements as allocations to spot Bitcoin in 2021 are still outperforming assets like crypto stocks.
Join Bitcoin Magazine Telegram to keep track of news and comment on this article: https://t.me/coincunews