Analysts point out that demand from financial institutions and publicly traded companies are the main reasons behind the sudden repetition of all-time highs in Bitcoin (BTC).
“The main reason for the steady increase in Bitcoin was the increased interest and the aggressive buying activity of the institutes”, Nick Cote of Hxro Labs gaming trading platform said, “A lot of investors are going through grayscale.”
The surge in institutional demand is evident in the heavy accumulation of Grayscale’s Bitcoin Trust: BTC fund holdings were over 500,000 earlier this month.
Cote said that too Big US companies like Square and Microstrategy “put BTC on their books to hedge against inflation and mismanagement of central bank monetary policy”.. He described this behavior as a “positive feedback loop” in the markets:
“There will be setbacks, of course, but as long as the institutes believe the Bitcoin narrative is being used as a store of value or as a hedge against inflation, it will become a positive feedback loop.”
NEM’s commercial director, Nicholas Pelecanos, agreed Bitcoin fundamentals are now stronger than ever, pointing to a halving supply momentum, an increase in institutional adoption and a number of US publicly traded companies spending 10% of their balance sheets on assets “.
Pelecanos now expects the altcoin markets to surge. It states, “BTC is back at its all-time high, but what is worth noting is the valuation of altcoins, which are still on average 50% below their all-time high.”
Despite its optimistic outlook for altcoins Pelecanos warned that many alternative cryptocurrencies have not found significant acceptancein the following words:
“Some altcoins represent projects that have stopped working, but other projects have seen tremendous development in both adoption and technology.”
Analysts have also highlighted bullish signals from the mining markets; Glassnode CTO Rafael Schultze-Kraft noted that miners have hoarded an additional 10,000 BTC since March.
Are miners selling more #BTC at these prices? I do not think so. Unspent shipments from miners (mined BTCs that have never moved) have been on an upward trend since the accident in March. It has grown by more than 10,000 BTC since then. Graphic: https://t.co/pXcLqwr5QD pic.twitter.com/wreZg9fdIw
– Rafael Schultze-Kraft (@ n3ocortex) November 25, 2020
Miners’ income also recently hit new highs since the beginning of the yearafter restoring pre-halving values with a daily income of more than $ 20 million.
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