Bitcoin (BTC) officially reached a new all-time high on December 1, according to data from Coinbase and Tradingview, topping $ 1,982,923 almost three years later.
Despite the flop last week’s Thanksgiving, the bitcoin price managed to recover over the weekend. On Monday, BTC easily exceeded the $ 19,000 mark and hit a full-time high, albeit on two exchanges.
Three main trends have driven BTC from below $ 3600 in March to above $ 19,892. These include increasing institutional demand, reduced sales pressure and BTC’s resilience through 2020.
The data show that institutional demand has driven this process.
Most data in the series shows that the demand for bitcoin from organizations is growing rapidly.
In November, Grayscale recorded the highest net inflow ever, and the CME Bitcoin futures market saw nearly $ 1 billion in open interest.
In particular, Grayscale stated that more organizations invested in cryptocurrencies in the third quarter of 2020 than ever before.
The figures Grayscale sees are important in measuring institutional interest in Bitcoin because the Grayscale Bitcoin Trust is usually the first entry point for most organizations that buy BTC.
There are no exchange traded funds (ETFs) in the US for bitcoin and other major cryptocurrencies. Therefore, Grayscale Bitcoin Trust is the closest ETF investment company in the US market. The grayscale report was as follows:
More organizations invested in Q3 2020 than ever before, increasing their average liabilities from $ 2.2 million in Q3 2019 to $ 2.9 million in Q3 2020. Organizations that feel comfortable with the many products in the Grayscale Products Group, the average responsibility for individual product investors was almost double that of individual product investors in the third quarter of 2020. ”
As Cointelegraph reported in August, MicroStrategy bought BTC worth $ 450 million and approved Bitcoin as the Treasury’s main asset. It was probably the spark that triggered the current wave of institutional demand for the digital value store.
Throughout the summer, this was accompanied by high-profile Bitcoin distributions from companies such as Square, Paul Tudor Jones and then Stanley Druckmiller, which drove the positive market sentiment.
In November, Druckenmiller made it clear that Bitcoin is likely to surpass gold in 2020, saying:
“It has been around for 13 years and is gaining more and more stability as a brand every day.”
Low streams for whales
According to the network, after six months of the first half of the year in November, the pressure from the sellers from the whales also eased. In other words, the number of bitcoins sent to exchanges from wealthy investors has been steadily declining throughout the month.
Proportion of whales on the bitcoin exchange. Source: CryptoQuant
CryptoQuant chief Ki Yong Joo has stated that the whale exchange ratio is an indicator of long-term beef market sentiment. He said:
“Dear Dollar BTC Hotkeys! You can call me Moon Boy, but unfortunately there will be no mass dumping like in March this year. The whale price (90-day moving average) is still very low. Long-term growth is inevitable. “.
Reducing the pressure from sellers helped BTC maintain growth for the month, and finally allowed the regular cryptocurrency to reach a full-time high.
Bitcoin’s flexibility was a big factor
On June 13, JP Morgan said in a note that Bitcoin’s recovery from the March crash shows that it is back. Recognizing Bitcoin’s resilience as the largest investment bank in the United States is likely to be a major boost in confidence, especially for institutional investors.
Finally, the impressive performance of the past decade and the strong performance of the Bitcoin currency since falling below $ 3,600 on major exchanges in March have shown BTC’s resilience and long-term potential as a digital store with value.