The third quarter is in full swing, the fourth is not far off. In 2020, October was the month after which a rapid rally began, raising bitcoin from $10,000 to $64,000. Based on the current picture, can we predict whether the same sharp momentum will be repeated by the end of the year as in 2020?
Here it is worth remembering all the forecasts for the growth of the main cryptocurrency to $100,000 and above. Which may not be baseless.
But Pete Humiston, manager of Kraken Intelligence Research, notes that the situation with bitcoin in the third quarter of 2021 is still significantly different from what it was in the fourth quarter of 2020.
Despite the fact that bitcoin has grown from $29,000 to $48,000 in just one month, there is still no buying rush in relation to it.
Humiston argues that you can verify this by looking at the Grayscale Bitcoin Trust (GBTC). It continues to trade at a discount of around 13% to the spot price this week. Demand seems to be growing slowly. As a result, we will probably see this discount disappear, as market participants seize the opportunity to get bitcoins at a discount, the expert notes.
Two other factors characterize the current structure of the bitcoin market: low open interest in BTC futures and lower than expected funding rates. Both are in contrast to the start of the 2020 bullish trend and are at odds with trends given the pace of price increases over the past month.
"During the time that bitcoin rose from 30,000 to 48,000, open interest fell. Nobody actually saw a massive BTC rally, which came as a surprise and not entirely normal," writes Pete Humiston.
Well, 100,000 for one bitcoin may not be worth it yet. But there is still time until the end of the year. And in the market, you know, anything can happen, especially if the deal is about bitcoin.
Although such a rally is probably not really necessary if you trade the market slowly, moving in short dips. In this case, bitcoin is very technical, and the next key milestones are quite clear. While there is a correction in the local range 44,807.24 - 48,178.13 between the two red dotted lines, it is worth waiting for a likely reversal from its support, and after that - either consolidation or a breakout and growth to 50,000-52,000.
And finally, some news from influencers:
Mike Novogratz's Galaxy Digital filed with the SEC to open a bitcoin futures ETF under the Investment Company Act of 1940.
Galaxy Digital has previously applied for a spot bitcoin ETF but has not been approved.
Notably, the company led by Mike Novogratz, which as of June 30, 2021, boasts $1.42 billion in assets under management, will not invest directly in bitcoin, but in bitcoin futures and other investment instruments.
This move is logical after the chairman of the US Securities and Exchange Commission Gary Gensler just a few weeks ago announced the preference of the regulator - futures on BTC, rather than spot bitcoin.
In the weeks following these comments, applications for ETF approval on Bitcoin Futures came from a number of funds. These included VanEck, Invesco, Goldman Sachs, Grayscale Bitcoin Trust, and Viridi Funds.