With the crypto market halfway through this bull cycle, the amount of bitcoin readily available for sale is shrinking faster relative to demand growth. On-chain analysis by the market intelligence firm CryptoQuant revealed that the bitcoin market is currently experiencing a demand shock because demand growth is accelerating and supply is shrinking. According to a weekly CryptoQuant report , bitcoin apparent demand has been expanding since late September at a monthly rate of 228,000 BTC, while the total amount of BTC readily available for sale across crypto exchanges, over-the-counter (OTC) desks, miners, and the Grayscale Bitcoin Trust (GBTC) has declined to levels not seen since October 2020. BTC Demand Is Eating Supply Inventory The balance of BTC accumulator addresses, which refer to investors who buy BTC and have never sold any, is expanding monthly at a record-high rate of 495,000 BTC. Bitcoin demand growth has led to inventory levels at OTC desks declining by the largest monthly volume in 2024 for the first time since April 25. Bitcoin OTC desks’ monthly inventory has fallen by -26,000 BTC this year, with an additional 40,000 BTC decline in tier balance since November 20. “OTC desks source Bitcoin mostly for institutions and large buyers. If Bitcoin demand is outpacing supply, then OTC desks’ Bitcoin balances will decline, and vice versa. Right now, their balances are declining as demand outpaces supply,” CryptoQuant stated. Sell-side Liquidity Falls to 2020 Levels As demand continues to rise, so does liquidity in the industry. The total market cap of USD-based stablecoins recently crossed $200 billion for the first time, representing a 20% or $35 billion increase since late October. This reflects an influx of liquidity and fresh money in the crypto market. The growth also coincided with BTC rallying above $100,000 to $108,000. The crypto asset was worth $96,700 at the time of writing, per data from CoinMarketCap. Furthermore, bitcoin sell-side liquidity now hovers around 3.397 million BTC, the lowest level in over four years. This liquidity has shrunk even further by 678,000 BTC so far this year, greatly reducing the potential for selling pressure. Moreover, the liquidity inventory ratio, a metric that measures how many months of demand the current sell-side inventory covers, has fallen to 6.6 months from 41 months recorded at the beginning of October. CryptoQuant explained that a declining sell-side inventory ratio coincided with the BTC rallies witnessed in the first and fourth quarters of 2024. The post CryptoQuant Says Bitcoin Demand is ‘Eating’ Available Inventory, Here’s How appeared first on CryptoPotato .
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These Challenges Affect Institutional Crypto Adoption Strategies (Survey)
A new survey by the blockchain infrastructure provider P2P.org has unveiled some challenges and trends affecting institutions’ crypto adoption strategies. It also highlighted opportunities that institutions could explore to adapt to the evolving practices in the crypto industry. The survey included participation from more than 15 institutional players, with intermediaries, investment funds, and venture capital funds making up 46%, 31%, and 23% of the respondents, respectively. It is worth mentioning that intermediaries in this context refer to companies that manage assets on behalf of others, while institutions as a whole are those with large total value locked. Trends Affecting Institutional Crypto Strategies According to the results sent to CryptoPotato , 33.4% of respondents said the biggest challenge faced by their company is integrating new crypto yield products aligned with their risk tolerance. Another 13.3% revealed that regulatory compliance affects their ability to incorporate new products in their offerings. Additionally, 6.67% of the participants said it is difficult to find the right strategy for allocating crypto assets, while another 6.67% disclosed that integrating multiple yield solutions at a go has been a big challenge. Interestingly, 6.67% of the respondents attributed their biggest challenge to custodians limiting product functionality, while the remaining 33.29% mentioned other challenges not outlined in the report. P2P.org identified risk as a recurring theme during the interviews, and it was mentioned across multiple levels, including technology, operations, and regulation. For technology, the respondents insisted that smart contracts pose a risk to their organization’s security and reliability. Challenges In Operations and Regulation In operations, the surveyees explained how certain blockchain mechanics could affect the movement of funds across industries. For instance, withdrawing funds from staked tokens could make the assets unavailable for some time, limiting how quickly capital can be redeployed to other business areas. When it came to regulation, the participants disclosed that one of their biggest challenges was integrating a new product that was in line with the regulatory guidelines for their business region. “The involvement of legal and compliance team here is critical to assess the exact risk factor. As reported in one of the interview, failing to correctly assess the regulatory layer can affect the resources allocated to a new product initiative, which might later be deemed unacceptable by regulatory authorities,” P2P.org stated. With regulatory requirements posing a significant challenge, these institutions are facing limitations in product integration and innovation. The post These Challenges Affect Institutional Crypto Adoption Strategies (Survey) appeared first on CryptoPotato . Crypto Potato
Ethereum Set To Move Up Against Bitcoin, According to Analyst Benjamin Cowen – Here’s His Outlook
A closely followed crypto analyst says that Ethereum ( ETH ) looks primed to surge against Bitcoin ( BTC ) as we enter the new year. In a new video update, crypto strategist Benjamin Cowen tells his 848,000 YouTube subscribers that based on historical trends, Ethereum should soon bottom out against the top crypto asset by market cap. According to Cowen, ETH/BTC will rise sometime in early 2025 no matter how the crypto king fares against the US dollar. “Think about this: historically, ETH/BTC bottoms out either in December or January. It’s already December [22nd]. My guess? ETH stays weak against Bitcoin, probably for the rest of the year. It doesn’t mean you can’t have a green week – but it’s probably going to stay weak for the rest of the year, maybe early January, and then I would expect ETH/BTC to start moving up in 2025, regardless of the direction of BTC/USD.” Cowen goes on to note that also based on previous market cycles, 2025 should be a good year for ETH/BTC in terms of quarterly returns. “2022 Q1 and Q2 were red, then you had Q3 and Q4 [that] were green. The only other quarter that ETH/BTC has been green besides the second half of 2022 for the last three years was Q2 2024… But what do you notice about 2021? ETH/BTC was green. What do you notice about 2017? At least ETH/BTC was green in the first half, it was red in the second half but then it was green in 2018 as well. So I would argue as quarterly returns go, you’re probably going to see more green for ETH/BTC in 2025 and maybe even early 2026.” ETH/BTC is valued at 0.03444 ($3,343.71) at time of writing. Don`t Miss a Beat – Subscribe to get email alerts delivered directly to your inbox Check Price Action Follow us on X , Facebook and Telegram Surf The Daily Hodl Mix Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing. Generated Image: Midjourney The post Ethereum Set To Move Up Against Bitcoin, According to Analyst Benjamin Cowen – Here’s His Outlook appeared first on The Daily Hodl . Crypto Potato