Bitcoin - The Bull Run Resumes Its Rights
Bitcoin did not have a stellar second quarter, but things are starting to improve. There's still time to reach the $100,000 milestone before the year ends.
Bitcoin dropped from $71,000 to $53,000, a 25% decline. This is the biggest fall since February in percentage terms.
Bitcoin saw a 13% decline in the second quarter following a 69% increase in the first. It has led all asset classes from the start of the year (+55%), notwithstanding recent pullback.
The quarter's main event, the fourth halving, had a favourable effect on the market. Clearly, the effects took time to manifest. But over time, the effect is the same as if you were to purchase 450 BTC every day that you would never be able to sell.
As we previously reported, traders have begun to hedge as a result of bitcoin sales connected to Mt. Gox and the German authorities. ETFs are where the shift in market attitude has been most noticeable.
The graph below illustrates how net inflows into exchange-traded funds (ETFs) decreased to $2.5 billion in the second quarter from $12.1 billion in the first.
Outflows from the beginning of June are evident. That is, the moment the German government appeared beside the ancient sea serpent Mt. Gox:
After the completion of the 50,000 BTC German government sales, net inflows into ETFs have once again increased. Investments in cumulative ETFs are back at record highs.
The market has not been negatively impacted, as anticipated, by the redistributions in the Mt. Gox bankruptcy (142 000 BTC). Without any significant sales, more than 65% of creditors have already been paid back. Roughly $6 billion, or 90,000 BTC, remain to be allocated, according to Arkham.
The US presidential election is coming up, and that already portends extremely nicely for bitcoin.
The former US president, who was initially dubious, has now finally changed his mind. Bitcoin's value even increased by over 10% after the weekend's attempted murder.
His talk at the Nashville Bitcoin Conference, scheduled for July 25–27, seems fantastic!
Let's just mention in passing that James Vance, his running mate, disclosed in 2022 that he owned bitcoins valued between $100,000 and $250,000...
The CEO of BlackRock, the biggest investment firm in the world, is still praising bitcoin, which is another reason to be hopeful.
Now we just need to persuade Xi Jinping of its worth. As long as China doesn’t lift its money controls, this will be challenging. It's true that nobody can stop bitcoin transactions.
If China consented to open its financial boundaries, we could envision that the United States would recognise bitcoin as the global store of value. Then, there would be no reason to keep the bitcoin anathema in place.
The acceptance of bitcoin-backed exchange-traded funds (ETFs) in Hong Kong is encouraging.