The Moon is Rising
Saylor and Do Kwon keep buying Bitcoin
Don’t miss last weeks podcast. Hal, Boomer discuss what’s going on with oil, commodities and how it may impact Crypto.
Altcoins We Are Watching
MacroStrategy, a subsidiary of MicroStrategy, has closed a $205 million bitcoin-collateralized loan with Silvergate Bank to purchase bitcoin (Twitter)
Just as Hal Finney Predicted, Bitcoin Is Being Purchased to Act as a Reserve Currency (CoinDesk)
ETF provider WisdomTree launches Solana, Cardano, Polkadot ETPs (CoinTelegraph)
Indian state gov't uses Polygon to issue verifiable caste certificates (CoinTelegraph)
Greenpeace, Ripple co-founder campaigning to change Bitcoin code (CoinTelegraph)
Grayscale Threatens Legal Action if SEC Rejects Bitcoin ETF Conversion Bid (Blockworks)
Hedera Hashgraph Gets $155M Fund to Drive DeFi Development (Blockworks)
WWE Signs Deal to Launch NFTs Through Fanatics’ Candy Digital (Decrypt)
Biden Eyes $5 Billion in 2023 Revenue From Applying New Tax Reporting Rules to Crypto (Decrypt)
Bitcoin has favored the traders since its initial markup in fall 2020. After Bitcoin reached its new ATH (20k) and the sellers from pre-2018 had been exhausted the price action became a trader’s paradise. HODLers oh 3+ years won in fall 2021 - spring 2022, but last year went to the traders. A horde of buyers came in Jan 2021 under $42k and the price continued its parabolic rise – Elon Musk bought, Saylor kept buying. On chain analysts, stock-to-flow tweets and all kinds of other euphoric memes led many to believe BTC would go to $100k in 2021. All while traders were riding the volatility and selling into the rally. For whatever reason everyone got bored in April, probably because $100k is too close to $60k to be excited after seeing all the recent rises. Each new peak left new buyers disappointed and then in May all the big players pulled out, a few lucky or smart traders caught some big shorts and everything cooled off.
It's not coincidence that BTC sold off to a few percentage points over the January 2021 low. The markup was already there and everything from Jan – April was volatility as people hunt for the fair price after the markup. Clearly (hindsight is 20 20), $28k was too low according to the market and we took another stab at hunting for the fair price. New buyers came in mid-summer but stalled at $52k. Selling ensued but when support was found at $42k (the January 2021 high) many buyers came back in. The Santa Clause rally came early in 2021. Everyone came back from their summer vacations and pressed buy. Two failures to hold support above the old ATH and the goose was cooked. I personally got out here although I left too much in random altcoins and that hurt me. Always remember when BTC starts selling off altcoins have historically led the race down.
So, now it’s 2022 and BTC caught a random bottom at $32,800 which is about +15% above the June 2021 low, and today we are 13% above the December 2021 big wick down that created a local low. Based on all of this price action and story it seems the market has determined the fair price of BTC to be somewhere between $42k-$52k. Buyers are relatively quickly buying coins under $42k and selling them off over $52k and no one wants to let the price go above $65k.
Unless there is a demand increase or supply shock (halving 2024) BTC will most likely trade within this price range $33-$65k in the following 24 months. It would seem that trading is better than HODLING in the near term. Or if you want to pick up coins to hold for the long time betting on a markup after the 2024 halvening event then under $42k is a bargain, and $42-$52k seems fair.
Not ETH update today. When BTC trades up like this , ETH historically rises faster.
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