Bitcoin prices saw a huge surge this week.
Bitcoin Demand Surpasses Supply
The latest data released by the CIO of Bitwise, Matt Hougan shows the stark difference between the supply and demand cycle of Bitcoin. The data suggests that the ask for Bitcoin currently stands at over 30,000 however, the availability of BTC is 6,000. The number, if simplified, shows that the demand exceeds the supply by around 20.5%, according to CoinGape calculation. Matt Hougan previously also said that there is currently an overabundance of demand and a deficiency of supply for Bitcoin. When there is a shortage of the original coin, it is more likely that investors will pay astronomical prices for a tiny percentage of asset exposure.
Here’s the weekly summary (Feb. 24 – March 1, h/t @HODL15Capital).
Keep it simple: There is more demand than new supply. pic.twitter.com/ighWC0hOOi
— Matt Hougan (@Matt_Hougan) March 2, 2024
Will a Supply Crunch Push Bitcoin Forward?
Bitcoin has seen extreme demand in the past week. A big contributor to the demand was also the popularity of Bitcoin ETFs. With the current supply crunch, if the crunch persists, the prices of BTC could ascend even further.
However, with other factors like a dent in risk appetite, the Fed’s rate trajectory, and Bitcoin halving coming into play, the certainty of the rise can take a hit given the volatile trading nature of crypto markets.
Bitcoin Prices Right Now
BTC’s price had previously risen above $63,000, being a little bit below its 27-month-old top of $68.7K. The increase implies that traders are starting to show more interest in joining the Bitcoin bandwagon. However, recoiling on the upward trajectory, the price currently stands at $61,954.46, being nearly 1% down as compared to the same time yesterday. The previous upward push came on the back of Bitcoin ETF hype. However, even the ETFs saw a slight outflow on Friday.
The $139 million net withdrawal from the Bitcoin spot ETF on Friday was the first in seven trading days, according to SoSoValue data. A $492 million net outflow occurred in a single day for the Grayscale ETF GBTC. In only one day, BlackRock ETF IBIT experienced a net inflow of $202 million, bringing its total historical net inflow to date to $7.96 billion. The $202 million that was placed into BlackRock’s iShares Bitcoin ETF (IBIT) represents a substantial drop in comparison to the most recent inflows. BlackRock’s net inflow following the most recent influx was over $7.95 billion, with its asset holdings rising by over $10.5 billion.
Source:coingape.com
