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Bitcoin Holding Firmly Above $50,000 as “Supply Shock” Indicates More to Come
Bitcoin (BTC) is holding firmly at $51,800 at time of writing and is up about 7% over the past week. After the top cryptocurrency traded in a very tight range throughout the weekend, on chain analyst Willy Woo highlighted on Twitter what is called the “supply shock” metric, which simply is the unavailable BTC supply divided by the available BTC supply.
According to the metric, that uses an algorithm to compare similar supply and demand situations, one BTC should cost at least $55,000.
According to Willy Woo, “in this view of demand and supply, an investor who has no intention to sell is on the demand side while an investor who is willing to sell is on the supply side.”
Supply Shock valuation model.
Uses a look-back algo to determine what the market priced BTC at prior demand and supply situations.
Currently puts BTC above $55k.
It’s conservative as one of the SS metrics, exchange SS, is now above all-time-high so no look-back is possible. pic.twitter.com/zMuI6AcvZI
— Willy Woo (@woonomic) September 5, 2021
Referring to the amount of coins held in cold storage, Woo acknowledged in the tweet “exchange SS, is now above all-time-high so no look-back is possible.”
Dylan Le Clair, another on-chain analyst, showed the graph representing this exchange supply shock as he tweeted:
$BTC balance on exchanges is at a 2021 low.
It’s probably nothing. pic.twitter.com/UxA3DRqUil
— Dylan LeClair (@DylanLeClair_) September 5, 2021
He then summed up some recent developments, indicating that the bull-run is far from over and that $100,000 with Christmas, as PlanB previously predicted, is very much in play.
All bears will die.
— Dylan LeClair (@DylanLeClair_) September 6, 2021
Ethereum, the second-largest cryptocurrency by market capitalization, reached $4,000 on Friday for the first time since May. ETH is up about 25% in the past week.
The post Bitcoin Holding Firmly Above $50,000 as “Supply Shock” Indicates More to Come appeared first on iGaming.
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Author: Peter Siu