Over the past week, Bitcoin has shown a noticeable drop in price by 9%. Lately, bulls in the coin market have been disappearing, and given its $ 52K valuation at the time of publication, most traders have a question whether BTC will return to levels close to 62K over the next weeks.
If bitcoin’s status as a long-term asset remains undeniable , what can be said about the near-term performance, and will the market show further price declines ahead of a recovery?
The data provided by Santiment shows how quickly the arguments for bullish divergence are fading away.
The low circulation ratio of tokens, which was noted after bitcoin fell below 52 thousand dollars, indicated a bearish outlook for the coin in the near future.
According to the information provided, the last time this token circulation ratio was observed in September 2020, when the price of the cryptocurrency experienced a long period of sideways movement.
At the same time, there are signs that investors are increasingly confident in the imminent pullback. Price expectations in April are quite high, and many investors are confident that the $ 80,000 mark may be reached by then.
There are a large number of call options expiring on April 31st that suggest the price will hit the $ 80K mark, giving Bitcoin a little over a month not only to recover, but also to establish a new ATH with a fairly large margin.
Despite all the difficulties in predicting the next vector of market movement, the BTC recovery cannot be discounted. Santiment points out that over the past 24 hours, 1.24 million active bitcoin addresses coincided with a monthly high, so it can be argued that this fundamental indicator of the market speaks of a rapid recovery.
An analysis of the volatility level of the coin over the past 6 months also shows that significant price changes can be expected from Bitcoin. True, in the near future, the period of sideways movement can seriously slow down the coin’s aspiration for growth.
State investment funds plan to invest in bitcoin
State investment funds are interested in buying bitcoin, says Robert Gutmann, CEO of New York Digital Investment Group (NYDIG). According to Gutmann, they are negotiating with such funds about possible investments in cryptocurrency.
Gutmann made his announcement during a podcast with Real Vision founder Raul Pal. The latter confirmed this information, announcing that the Singapore Sovereign Wealth Fund Temasek is indeed investing in bitcoin. According to him, Temasek, which has $ 306 billion in assets under management, buys new bitcoins from miners.
Drawing parallels between recent investments in publicly traded companies, including MicroStrategy and Tesla, and government funds, Gutmann noted that such players are seeking to hedge dollar-denominated liabilities and are re-evaluating portfolios.
“Looking at today’s world from a future perspective, investment committees reasonably question whether it is right to keep all assets denominated in dollars with dollar-denominated liabilities,” he added.
NYDIG is part of the managing director of Stone Ridge Asset Management with assets of $ 10 billion. Earlier, Gutmann announced that by the end of this year he expects his clients to concentrate capital in bitcoin by more than $ 25 billion.
“I am confident that we will have more than $ 25 billion in bitcoin by the end of 2021. It’s in the order book. I don’t guess, I see what’s happening , ”he said.