Bitcoin continues to be the market leader. However, despite significant developments, such as the introduction of spot Bitcoin Exchange-Traded Funds (ETFs), the anticipated price surge to $100,000 remains ‘unrealized.’
Charles Edwards, founder of Capriole Investments, commented on this and took to Elon Musk’s social media platform X to explain the hurdles preventing Bitcoin from achieving this milestone.
Examining Bitcoin’s Stagnation Below $100k
According to Edwards, one of the primary factors is the sale of Bitcoin by long-term holders. His analysis shows a decline in wallets holding Bitcoin for over two years, from an all-time high of 57% in December 2023 to 54%.
The growth rate of Bitcoin holders. | Source: Charles Edwards on X
Although this 3% drop might seem minor, it represents about 630,000 BTC—far exceeding the quantity purchased by US Bitcoin ETFs since January. This sell-off by long-standing investors is exerting downward pressure on the price.
Edwards also pointed out that the market has yet to fully feel the impact of Bitcoin’s halving event in April, which reduced the daily issuance of Bitcoin by 50%.
We haven’t seen the impacts of the Halving yet.
With the daily Bitcoin issuance dropping by 50% in April, we will likely see the delta between ETF consumption and Bitcoin mined widen a lot over the next year. It also takes full quarters for institutions to review, sign-off and… pic.twitter.com/bAxfFzv6L8
— Charles Edwards (@caprioleio) June 7, 2024
He believes that the gap between the amount of Bitcoin purchased by spot ETFs and the reduced output from mining will widen significantly, underscoring the need for financial institutions to adjust their strategies and continue leading in Bitcoin acquisitions.
Meanwhile, Edwards identified three key factors that he believes are essential for a sharp rise in Bitcoin’s price: increased daily ETF purchases, reduced selling by long-term holders, and an expansion in U.S. market liquidity.
BTC Price Slow Amid Record ETF Inflows
Bitcoin trades at $71,926, showing modest movements as it struggles to mark any price increase over the past 24 hours, despite a 4.9% rise in the last 7 days.
BTC price is moving sideways on the 4-hour chart. Source: BTC/USDT on TradingView.com
While Charles Edwards has detailed reasons behind Bitcoin not reaching the $100,000 milestone, other experts are analyzing why substantial inflows into spot BTC ETFs have not translated into a corresponding price surge.
Experts believe that various factors muffle ETFs’ influence on Bitcoin’s price. Seasoned crypto trader Christopher Inks points out that a complex interplay of spot trading, futures, options, and ETFs influences the Bitcoin market.
Inks stresses that an exclusive focus on ETF activities does not provide a complete view of the market dynamics. Responding to a user query on X about the stagnant price despite ETF purchases, Inks remarked, “You do realize the market is made up of spot, futures, ETFs, and options, right? Price at any point in time is a product of all of these, not just one of them..”
Further discussions among financial experts illuminate the multifaceted nature of the BTC market. Analyst Eric Balchunas suggests that the lack of price movement despite ETF purchases might be due to existing Bitcoin holders selling their holdings, which balances out the buying pressure from ETFs.
I’ve said it before and I’ll say it again, the call is coming from inside the house holmes. This is not ETFs doing, obv bc they buying like crazy lately, it’s bitcoin holders selling or leveraged flushers or whatever. Time and again ETFs go on flow-a-thons and its met with… https://t.co/iuGNayrLgd
— Eric Balchunas (@EricBalchunas) June 6, 2024
Another expert, Jimie, explains that while ETFs contribute to market activity, they represent a small portion of the total Bitcoin circulation.
Jimie added that the majority is controlled by large holders (“whales”), whose trading activities could overpower the influence of ETF buying. This dynamic indicates that significant buying by ETFs often meets with heavy selling, maintaining price equilibrium.
Featured image created with DALL-E, Chart from TradingView
Samuel Edyme
Meet Samuel Edyme, Nickname – HIM-buktu. A web3 content writer, journalist, and aspiring trader, Edyme is as versatile as they come. With a knack for words and a nose for trends, he has penned pieces for numerous industry player, including AMBCrypto, Blockchain.News, and Blockchain Reporter, among others.
Edyme’s foray into the crypto universe is nothing short of cinematic. His journey began not with a triumphant investment, but with a scam. Yes, a Ponzi scheme that used crypto as payment roped him in. Rather than retreating, he emerged wiser and more determined, channeling his experience into over three years of insightful market analysis.
Before becoming the voice of reason in the crypto space, Edyme was the quintessential crypto degen. He aped into anything that promised a quick buck, anything ape-able, learning the ropes the hard way. These hands-on experience through major market events—like the Terra Luna crash, the wave of bankruptcies in crypto firms, the notorious FTX collapse, and even CZ’s arrest—has honed his keen sense of market dynamics.
When he isn’t crafting engaging crypto content, you’ll find Edyme backtesting charts, studying both forex and synthetic indices. His dedication to mastering the art of trading is as relentless as his pursuit of the next big story. Away from his screens, he can be found in the gym, airpods in, working out and listening to his favorite artist, NF. Or maybe he’s catching some Z’s or scrolling through Elon Musk’s very own X platform—(oops, another screen activity, my bad…)
Well, being an introvert, Edyme thrives in the digital realm, preferring online interaction over offline encounters—(don’t judge, that’s just how he is built). His determination is quite unwavering to be honest, and he embodies the philosophy of continuous improvement, or “kaizen,” striving to be 1% better every day. His mantras, “God knows best” and “Everything is still on track,” reflect his resilient outlook and how he lives his life.
In a nutshell, Samuel Edyme was born efficient, driven by ambition, and perhaps a touch fierce. He’s neither artistic nor unrealistic, and certainly not chauvinistic. Think of him as Bruce Willis in a train wreck—unflappable. Edyme is like trading in your car for a jet—bold. He’s the guy who’d ask his boss for a pay cut just to prove a point—(uhhh…). He is like watching your kid take his first steps. Imagine Bill Gates struggling with rent—okay, maybe that’s a stretch, but you get the idea, yeah. Unbelievable? Yes. Inconceivable? Perhaps.
Edyme sees himself as a fairly reasonable guy, albeit a bit stubborn. Normal to you is not to him. He is not the one to take the easy road, and why would he? That’s just not the way he roll. He has these favorite lyrics from NF’s “Clouds” that resonate deeply with him: “What you think’s probably unfeasible, I’ve done already a hundredfold.”
PS—Edyme is HIM. HIM-buktu. Him-mulation. Him-Kardashian. Himon and Pumba. He even had his DNA tested, and guess what? He’s 100% Him-alayan. Screw it, he ate the opp.
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