Investors Increasingly Bullish As New Money Is Flowing Into Bitcoin
- Bitcoin realized value hits ATH at $103.5 billion, up 15% from Dec. 2017 when the price was at its peak
- The premium on bitcoin futures means investors across all platforms increasingly bullish for the upcoming months
The amount paid for all bitcoin has reached an all-time high (ATH) of $103.5 billion, as per the data provided by Glassnode, which is up about 15% from the value when the Bitcoin price hit its peak at $20,000 in December 2017.
Currently, Bitcoin is trading at a five-month high of $10,138, hitting $10k for the first time since October 2019.
Created by crypto analytics firm, Coin Metrics, realized cap is an alternative approach to market cap as a measure of network valuation. The realized cap values all the coins in the network based on the last time they were moved.
This is unlike market capitalization which uses the last traded price and multiplies it by the coins in circulation, which is currently at $184 billion. Borrowed from the world of equities, the Coin Metrics team found market cap to be an empty metric when applied to cryptocurrencies.
Unlike equities, large fractions of cryptos tend to get lost, go unclaimed or remain dormant because of bugs. So, to take into account the permanently lost bitcoins, which are roughly 15% of the supply, this metric was created.
According to Arcane Research, this new high is a bullish signal but says these shifts in the realized cap should only be used as an indication. This is because a large amount of the currency bitcoin supply is held by exchange and leaves no trace on the blockchain if traded within the same exchange. Also, large BTC holders and exchanges moving coins between the wallets inflate the metric.
Investors increasingly bullish for the upcoming months
When it comes to new money flowing into the market, institutional investors are just as active as retail ones.
Retail and institutional investors are in agreement on futures bitcoin price, for the first time in several months. The premium rates for BTC are about equal across most platforms, with the premium rate on March contracts keep on rising but June premiums are decreasing, at just above 10%.
With the annualized premium rates for both February and March bitcoin futures contracts above 20%, this means, “Investors across all platforms are increasingly bullish for the upcoming months,” found Arcane Research.
Latest COT Report: Leveraged Funds (i.e. Hedge Funds & CTAs) Net Positioning reaches a 6mth+ low on the CME BTC Futures.
Bullish 📈or bearish 📉? pic.twitter.com/tw7CBQtZN4
— skew (@skewdotcom) February 9, 2020
Meanwhile, roughly 500 contacts, 2500 BTC worth of interest rolled off for the second week in a row on CME, “in contract to near-record highs on Bitmex,” as per Market Science’s COT Report.
The trading volume for these contacts is also pushing to new highs, reaching over $600 million last week, the highest since the price topped last summer. January saw an increase of 250% in daily volume.
However, these trading activities are still far from retail exchanges like BitMEX which sees daily trading volume 10x of CME.
The net short positioning of the largest layers in the CME futures markets, leveraged funds meanwhile, has increased “significantly” from last week. Other reportable positions, on the other hand, flipped net-long after being net-short much of 2019.