Bitcoin Retesting the Lower-End of Range, OI Still Continues to Soar While GBTC Unlocks Now Behind Us
There is currently a lack of inflows in Bitcoin as it saw another week of outflow, though minimal relative to May and June, while Ether had a third consecutive week of inflows. As per CoinShares, it’s just “the summer doldrums” which are “in-line with seasonal expectations.”
Weakness in the market continued this week to push Bitcoin price yet again below $30k. The leading cryptocurrency fell to about $29,300 while Ether went to $1,717. The total cryptocurrency market cap is now at $1.24 trillion.
However, this time, stocks, bond yields, and even commodities are falling fast, with a stronger USD acting as a headwind for risk assets.
Amidst this, open interest on Bitcoin futures on the leading exchange Binance has surged to 101.37k BTC, an increase of almost 78% in nearly a month. As for total Bitcoin OI, it has now crossed 400k BTC, up from 375.74k just three days back.
As for Ether, in two weeks, OI on Binance has climbed to 770k ETH, representing an increase of 44%. Meanwhile, in the past three days, the total Ether OI has jumped from 2.77 million ETH to 2.94 million ETH million, as per Bybt. ETH 0.87% Ethereum / USD ETHUSD $ 3,875.09
$33.710.87% Volume 16.06 b Change $33.71 Open $3,875.09 Circulating 117.97 m Market Cap 457.14 b 1 d Euphoria is Back Ahead of ETF Listings: Bitcoin Hits $63k and Ether Nearly $4k as NYSE Certifies “Approval for Listing” 2 d Bitcoin Breaks Through $61,000 as Euphoria & ‘Greed’ Brings the Money Back In 2 d Indexed Finance's NDX Is Down 92% from ATH After $16 Million Hack Sends it Crashing
In response to this increase in OI, data tracker IntoTheBlock noted, “Strong bearish signals on the derivatives market. Price declining while open interest rises indicate new short positions are being opened.”
— CL (@CL207) July 19, 2021
This price drop also came amidst the lack of any inflows that have been helping the crypto prices rally as CoinShares noted in its report, “the summer doldrums are here, but in-line with seasonal expectations.”
In another quiet week, digital asset investment products had minimal net inflows of $2.9 million last week, with Bitcoin products having another set of outflows. For the second week, Bitcoin had outflows totaling $10.4 million, though remaining minimal relative to the significant outflows witnessed in May and June this year.
Ethereum, however, had its third consecutive week of inflows, with last week’s inflows of $11.7 million bringing the total inflows for this year close to the $1 billion mark.
While altcoins did see inflows, they were weak with Ripple, Polkadot, Multi-asset, Cardano, and Stellar having less than $0.5 million each. Volumes in altcoin also fell to just 38% of the year-to-date average, totaling $3.9bn per day last week. XRP -2.53% XRP / USD XRPUSD $ 1.10
-$0.03-2.53% Volume 3.23 b Change -$0.03 Open $1.10 Circulating 46.88 b Market Cap 51.76 b 1 d Ripple Joins The Digital Pound Foundation to Help In The Development of A CBDC In the United Kingdom 3 d Australian Stock Exchange (ASX) to List Crypto-Focused ETF on 'Growing' Investor Demand 5 d Ripple And NelNet Join Forces to Fast-Track Crypto’s March to Renewable Energy DOT 2.05% Polkadot / USD DOTUSD $ 42.57
$0.872.05% Volume 1.83 b Change $0.87 Open $42.57 Circulating 987.58 m Market Cap 42.04 b 3 d CME Bitcoin Futures Open Interest Cracks A New ATH, Ethereum Aims for $4k Again 3 d Polkadot Sets Launch Date for Initial Parachain Auctions, DOT Soars 17% Ahead of Crypto Market 5 d Institutions Are Back to Pouring Money into Bitcoin as a “Perfect Storm” Brews for the King ADA -0.14% Cardano / USD ADAUSD $ 2.16
$0.00-0.14% Volume 2.06 b Change $0.00 Open $2.16 Circulating 32.9 b Market Cap 71.11 b 3 d Polkadot Sets Launch Date for Initial Parachain Auctions, DOT Soars 17% Ahead of Crypto Market 5 d Institutions Are Back to Pouring Money into Bitcoin as a “Perfect Storm” Brews for the King 1 w Robinhood Cites Regulatory Actions or Policies Towards Crypto as Business Risk in Filing XLM -1.66% Stellar / USD XLMUSD $ 0.39
-$0.01-1.66% Volume 1.04 b Change -$0.01 Open $0.39 Circulating 24.07 b Market Cap 9.41 b 1 w Robinhood Cites Regulatory Actions or Policies Towards Crypto as Business Risk in Filing 1 w MoneyGram Partners With Circle And Stellar to Launch Cash In And Cash Out Links to USDC 2 w Payment Processor Stripe Is Hiring an Engineer for its Brand New “Crypto” Team
“We do not believe this represents something ominous in the market as we saw similar seasonal dips in volumes during the summer months in recent years,” said CoinShares.
Institutional demand (IDR) that drove the ATHs of 1H'21 has dropped off significantly since May. Hitting new 12-month lows this morning.
On-chain demand has dried up and inflows have stalled, price followed!
— James Bennett (@jamesonthechain) July 20, 2021
On-chain data, according to Weiss Ratings, “reveals the battle between institutional bears and retail bulls,” with long-term HODLers and miners showing “incredible resilience.”
And while demand for the all-purpose Bitcoin exchange-traded funds (ETFs) has slowed down, over-the-counter (OTC) deals for BTC seem to be growing.
The good thing is, the largest unlock of Grayscale Bitcoin Trust is behind us though GBTC is still trading at a heavy discount of 13.44%. “While this does not directly impact the price of BTC, traders may see an opp to short BTC and buy GBTC in anticipation of a narrowing discount from here,” said James Bennett of ByteTree.
At the same time, while GBTC discounts are bad for sentiment, trader and economist Alex Kruger notes that “most positions are hedged and need to cover the borrow/short which puts upwards pressure on spot.”
— Alex Krüger (@krugermacro) July 19, 2021
In the long term, the majority of 42 global cryptocurrency experts believe hyperbitconization will happen by 2050, according to a new survey published by UK-based personal finance platform Finder.
While 29% surveyed expect it to happen a decade earlier by 2040, 44% do not expect it to occur.
When it comes to the price, the panelists predict the BTC price to increase up to $318,417 by Dec. 2025 and a whopping over $4 million by Dec. 2030. The median price prediction for 2030, however, comes to $470k. As for the current year, they are expecting BTC to end the year at just above $66k.
“Halving events and inflation along the way to 2025 and 2030 will likely trigger the larger upside moves,” said Justin Chuh, Senior Trader, Wave Financial, in the report. “Prices are likely to be continuously driven by supply and demand, less availability for a wider group of users.”