At the pace of the price bitcoin is accelerating, it's easy to get confused. This, despite whale activities have intensified in recent months. While it is commendable that the price of Bitcoin has doubled since it entered the New Year, concerns about why whale movements are not entirely reflected in the value of Bitcoin are valid.
To be clearer, an on-chain intern at Glassnode William Clemente analyzes the current market situation.
Will the movements be reflected only in the long term?
Noting that the coins are actually going out of the exchanges. He explained that it takes much longer for the dominance of stronger holders to be pronounced in the market.
"Many say," If coins are moved from exchanges, why doesn't the price go up? ". The price action is short-term, the increase in strong holdings is a long-term signal, ”he explained.
Demand needs to rise before long-term owner effects are reflected in the market, he added.
"The real effects of Bitcoin's illiquidity will be felt as new waves of demand come into play."
As for events in traditional markets, they are expected to play in Bitcoin's favor. Printing more money could push corporate investors back to the market. Clemente shares these same sentiments with many other Bitcoiners.
If this happens, we may see more companies accumulate in the months to come, some may even make it into the third or fourth quarter of the year, at which time sales and demand will cause a "gap" in prices.
Other contributing causes that could come into play
Another significant factor that is expected to send more investors to the market is the result of negative yielding bonds, which is essentially when the original purchase price of the bond is higher than the yields received on maturity of the bond.
It is also important to remember that Bitcoin has outperformed the market since the beginning of the year. The big bull has also managed to sustain gains on certain prices for months, which implies that the market is already maturing. As the creator of the Stock-to-Flow model reiterates, Bitcoin has only been in the bull market for 4 months and is still a long way from the end.
Ongoing market activities from both the industry and the traditional market are expected to “lead to significantly higher demand than we have seen. This massive surge of demand will be left to collect the small amount of Bitcoin left (we haven't seen anything yet). "
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Not entering the market at this point, it would be really silly. Even a minimum amount must be invested, because in a few years we will all find ourselves here uncorking champagne.