As Accumulation Rises, Huge Bullish Catalyst for Bitcoin
Galaxy Digital, a company that invests in cryptocurrencies, says that as Bitcoin (BTC) accumulation goes up, a major bullish catalyst is on the way.
“Two primary supply events loom in the future, one bullish and one potentially bearish.”
Galaxy Digital says that the bullish catalyst is the fourth halving of Bitcoin, which is set to happen in April 2024. Every four years, there is an event called “halving,” which cuts in half the amount of new BTC that is added to the market. In the past, the price of Bitcoin has gone up a lot when the supply of Bitcoin went down.
“Bitcoin’s next halving (projected to take place in April 2024) will bring the network’s inflation rate below 1% with roughly 450 new bitcoin being mined per day. Historically, Bitcoin’s three previous halvings (2012, 2016, 2020) have been pointed to as catalyzing subsequent bull runs, as existent demand quickly outstripped lower levels of new supply…
The 2024 halving should remain in focus for the simple reason that bitcoin’s inflation rate falling below 1% will place it among the hardest existing assets known to humanity, lower than historical store-of-value assets such as gold and silver.”
Galaxy Digital also notices that Bitcoin is getting more and more, which is another positive trend.
“On-chain data suggests ongoing accumulation of Bitcoin. The total number of addresses with a non-zero balance continues to rocket higher. More than 45 million addresses hold BTC. A large number of addresses have exclusively received Bitcoin – they have never spent. The number of so-called ‘accumulation addresses’ has spiked in the last month.”
A big amount of Bitcoin from the bankrupt and now-defunct cryptocurrency exchange Mt. Gox could flood the market as it is given to creditors. This could cause the market to go down. But Galaxy Digital says that this doesn’t seem likely.
“As a result of the 2014 exchange hack, the Mt. Gox bankruptcy trustee holds 141,686 BTC plus cash and BCH according to September 2019 documents. Based on our research and conversations with Gox creditors, we do not expect there to be a material supply event for BTC as a result of distributions to creditors.”
At the time of writing, Bitcoin is trading for $28,287, which is a 3.2% increase over the past 24 hours.
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