Bitcoin Deja Vu: Capital Inflows Mirror Pre-2021 Bull Run Momentum
14 Dezembro 2023 - 1:00PM
NEWSBTC
On-chain data shows the cryptocurrency capital inflows currently
look similar to December 2020, right before Bitcoin rallied from
$18,000 to $65,000. Bitcoin & Ethereum Are Getting $19.7
Billion In Capital Injections Currently As explained by analyst Ali
in a new post on X, Bitcoin and Ethereum are receiving a large
amount of capital inflows currently. To showcase these positive
flows, the analyst has referred to the “BTC + ETH Net Position
Change” indicator from the on-chain analytics firm Glassnode. What
this metric does is that it keeps track of the 30-day change taking
place in the combined realized cap of these top two
cryptocurrencies. The “realized cap” here basically refers to the
total amount of capital (in USD) that investors have used to
purchase a given asset. As such, the metric’s net position change
could provide hints about whether the total money invested into the
coin in question has gone up or down during the past month. Related
Reading: Santiment Points Out Trigger Behind 65% Cardano Rally Now,
here is a chart that shows the trend in this indicator for Bitcoin
and Ethereum over the past few years: The value of the metric
appears to have been going up in recent days | Source: @ali_charts
on X As displayed in the above graph, the Bitcoin + Ethereum Net
Position Change has been inside the positive territory recently and
has only been climbing up. The trend naturally makes sense, as both
of the assets have registered some sharp rises during the past
month. Currently, the indicator has a value of $19.7 billion. As
Ali has pointed out, “This is around the same capital inflow
we saw back in December 2020 before BTC surged from $18,000 to
$65,000!” In the same chart, data for two other metrics is also
shown. The first is the “Stablecoin Net Position Change,” which, as
its name suggests, keeps track of the monthly inflows and outflows
for the major USD stablecoins in the sector. Unlike Bitcoin and
Ethereum, though, this metric doesn’t make use of the realized cap,
but simply the supply of the stables. This is obviously due to the
fact that these coins have mostly the same value at all points, so
the realized cap wouldn’t be any different from the market cap
(which itself is equivalent to the supply as the price is $1). From
the chart, it’s visible that the stablecoins have also enjoyed
positive inflows recently. This means that all three major asset
classes in the sector, Bitcoin, Ethereum, and the stables, are
receiving capital injections currently. Most of the capital inflows
and outflows towards the cryptocurrency sector happen through these
three. The altcoins only receive their capital through a rotation
from these core assets. Related Reading: Dogecoin Sell Signal Goes
Off: Analyst Predicts Targets Thus, the stablecoins and top two
cryptocurrencies simultaneously enjoying positive inflows have
historically been a very bullish combination for the sector as a
whole. This constructive combination didn’t form for most of this
year but finally has during this latest leg in the rally. The last
indicator on the chart keeps track of the net incomings and
outgoings from the sector as a whole by simply summing up the
netflows for BTC + ETH and the stables. As is apparent, this metric
also has a value similar to December 2020 at the moment. Looking at
Bitcoin’s historical performance following December 2020, it could
mean that the BTC price is set for another price surge going
forward. BTC Price Bitcoin had recovered above the $43,000 level
just earlier, but it appears the coin has seen a setback as it’s
now once again trading below the mark. Looks like the price of the
asset has shot up during the past day | Source: BTCUSD on
TradingView Featured image from Shutterstock.com, charts from
TradingView.com, Glassnode.com
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