It seems that Bitcoin might have experienced the most significant drop in its short-term price decrease, going by what crypto analysts are saying. This is because there’s been a noticeable decrease in sellers on cryptocurrency exchange platforms.
According to Bitfinex analysts, the amount of Bitcoin available for sale is decreasing significantly, as noted in their January 6 market report.
Declining liquidity inventory ratio is bullish for Bitcoiners
Analysts shared that the time it would take for Bitcoin’s current supply to cover its trading demand on exchanges, as indicated by the liquidity inventory ratio, decreased significantly. A comparison in numbers: The ratio went from approximately 41 months back in October 2024, down to around 6.5 months currently.
For cryptocurrency investors, this situation is advantageous because reducing the availability increases the feeling that the asset is rare, often leading to an increase in its price.
Bitfinex analysts noted that this substantial drop corresponds with the surges seen in the first and fourth quarters of 2024, suggesting that there’s less money circulating during busy market times.
At the time of publication, Bitcoin is trading at $96,880, per CoinMarketCap.
On January 6th, the value of Bitcoin reached $100,000 for the first time since December 20th; however, over the next 24 hours, its price dipped down to a minimum of $96,261.
Anonymously-identified cryptocurrency trader, Daan, expressed on a recent Reddit post that it will be intriguing to observe Bitcoin‘s price movements over the near future.
As a researcher, I’d note that the market continues to display volatility, a pattern often seen towards the close and opening of the calendar year.
According to Bitfinex experts, a significant drop in miners sending Bitcoin to cryptocurrency exchanges around 2025 indicates that they anticipate the value of Bitcoin will continue to increase.
Crypto analyst says demand has also slowed
According to the analyst, miners are currently earning a profit because the current bullish market conditions make it easier for them to carry out their operations.
“As a result, they have largely chosen to hold onto their BTC rather than sell.”
According to their predictions made in December 2024, the analysts expect the minimum price of the asset to be around $145,000 by mid-2025. Under ideal circumstances, they anticipate it could even reach up to $200,000.
Simultaneously, Glassnode’s lead analyst, James Check, noted in his January 7th market analysis that while the pace of Bitcoin selling seems to be decreasing, the appetite for buying is also waning.
On the one hand, the urge to sell from current owners seems to be decreasing, but on the other, signs of new buyers entering the market are also diminishing. This was pointed out by Check, who mentioned that “the volume of transactions happening right now is plummeting at an alarming rate, dropping 53% since November.
From November 5th to December 5th, 2024, the value of Bitcoin increased by approximately 46%. It peaked at $99,006 and then moved beyond the $100,000 threshold on December 5th.
This post serves as a source of general knowledge and doesn’t function as legal or financial guidance. The perspectives, assumptions, and opinions shared within this content belong solely to the writer and may not align with or be endorsed by CryptoMoon.
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2025-01-08 05:27