Bitcoin has continued to rally to a new all-time high less than 24 hours after setting a previous level, seeing another impressive growth of almost 10% this morning and with analysts looking at what could be keeping the bullish movement running, it looks like it could still be set to continue for a little longer just yet.
According to CryptoQuant, yesterday saw more than 35,000 bitcoins purchased as big money continued to flow into the cryptocurrency and speculation as to continuing growth seems to point to institution investment still pouring into the market.
The Korea-based blockchain analysts said that they felt that the big money still coming into the market was as a direct result of larger institutions looking to ensure that they hold a stake within the cryptocurrency that continues to soar to new price heights, suggesting that there could be a potential “fear of missing out” mentality from the investors.
While the opinion is that of only one analyst, there is a firm argument that the large volume of bitcoin being purchased by single entities is the sign that larger investment portfolios are looking to scalp as many bitcoin as they can at the moment, potentially creating a supply squeeze in the market with large number of bitcoin potentially set to become illiquid as firms look to hold their newly bought asset for a long period of time.
This could be a large factor of the rallying prices that we are seeing at the moment, especially since data suggests that while so many bitcoin were being purchased in recent days, miners have only been able to free off a further 1,700 bitcoin in the same time period.
High demand, limited supply
Bitcoin has become one of the most spoken about investments in recent months and with the continued acceptance of the cryptocurrency as a potential move towards a ‘gold 2.0’ or ‘digital gold’ commodity, more and more institutions are seeing the crypto as a possible asset worth holding within their portfolio.
After Glassnode, another blockchain analyst firm revealed that only 4.2 million bitcoin are actively available for possible trading and citing that they believe that number is reducing with the new ventures into the crypto market by larger buyers who are looking to hold their investment, supply is starting to dwindle.
With high demand and a decreasing number of tradable bitcoin within the market in recent weeks, the price rally looks like it has still to hit a level of resistance that could push the price back down, pointing to further increases on the not so distant horizon.