October 15, 2021
All-Time Highs Are in Sight
It has been months since Bitcoin peaked at $64k and a tough period of uncertainty and choppy price action ensued. Now, the crypto markets are back strong but it seems like many on Crypto Twitter are still in disbelief.
Indeed, people who only joined in the last 6 months will understandably be scared of another price fall into the abyss. Seasoned hodlers on the other hand – while certainly not emotionally unaffected – weathered the last few months much better and are now (according to on-chain metrics) as confident as ever that this is the mere start of another strong bullish leg up.
Several yellow flags such as high funding rates and rising greed should keep us level-headed In the short term, however (it’s not the time to sell your house and go all-in... 😉)
Bitcoin ETF Confirmed?
It seems like not much is standing between now and the first launch of a Bitcoin ETF in the US! Let’s hold our breath for an official confirmation…
The SEC has already put out guidelines on Bitcoin Futures ETF investing. 👀
How long have we waited for a Bitcoin ETF? Crypto OGs will know that the “ETF meme” has been alive for many years now. Clearly, many will be in disbelief if we finally get an ETF approved!
In case you wonder if you should get your hands on the imminently launching Bitcoin Futures ETF – if you’re not a corporation or institutional player, the answer is clearly no.
The next critical step is, of course, getting a physically-backed Bitcoin ETF. The chances for an approval are indeed getting better but it would be surprising to get one approved already this year.
Long-Term Holders Are Holding Their BTC Tight
A couple of days ago, we observed some profit-taking by older BTC holders and we mentioned that we should keep an eye on this metric. What are we seeing now? Long-term holders are holding more Bitcoin than ever, signaling that there might not be enough liquid BTC for everyone who wants to get in.
With the likely Bitcoin ETF approval serving as a strong catalyst, this could mean another historic supply shock is just around the corner.
While we see bullishness and confidence across the board on Crypto Twitter, which is generally a short-term warning sign, we are still far away from reaching a “macro euphoria top”. There are simply too many people still on the sidelines…
Do You Have a Strategy in Place?
Now that the time of boring price action seems to be coming to an end, it is important to ask yourself if you are mentally prepared for what might come next. Having a strategy in place to keep you from making rushed, emotional decisions is key, especially in a phase of rapid price moves.
Time and experience are the best teachers when it comes to investing! However, learning from others can help you avoid “expensive mistakes” in the beginning. Here are a couple of tips that you might find useful:
Microstrategy’s Massive Bitcoin Bet Is Playing out
Often laughed at by the mainstream and even ridiculed by many in the crypto community, Michael Saylor’s enormous Bitcoin bet is ultimately bearing fruit, generating more than a 2x on the company’s investments. No one can say that Saylor didn’t have strong hands since several of Microstrategy’s BTC buys were heavily underwater for a couple of months…
Massive Amounts of Money Are Flowing into the Space
While BTC is drawing all eyes thanks to the (rightly hyped) Bitcoin ETF, there is a TON of capital flowing into the overall crypto space, which will ultimately help drive and accelerate the developments in the cryptosphere
When a Narrative Becomes Too Hot…
We recently covered DeFi 2.0 and the impressive rise of the “cool Ponzi” project Olympus. As we have seen time and time again, too much attention and hype on Crypto Twitter is generally not good for an ongoing trend. When too many people are on one side of the boat…
Just look at the OHM chart below to see what a violent sell-off looks like. Its price plunged more than 50 % in a matter of just 24 hours (it recovered somewhat since but is in danger of rolling over again). This is a good reminder to always keep a cool head when investing and not jump on a trend when it’s already getting too hot.
OHM’s “sticky” price mechanics proved to work very well during a bullish trend. But how does it react when some holders start to sell nevertheless? A reflexive down spiral could be the result. For now, let’s see if holders remain loyal and keep OHM afloat… It’s definitely an interesting experiment.