Bitcoin’s firm 2020 uptrend has sparked a sense of “FOMO” (fear of missing out) among cryptocurrency investors who are keeping their eyes on a plethora of different fundamental factors that could catalyze an intense BTC bull rally in the year ahead, Cryptoslate reported.
The FOMO induced by these factors – which include the cryptocurrency’s upcoming mining rewards halving among other things — is elucidated while looking at the amount of bitcoin (BTC) wallet addresses holding over one BTC.
This number has been rapidly rising as of late, suggesting that retail investors are engaged in heavy accumulation, which could provide the crypto with significant momentum.
At the time of publication (7 pm Hong Kong tome on Tuesday), bitcoin was trading at $9,800, down from its high of $10,200, which was set on Thursday at the peak of the cryptocurrency’s rally.
Although BTC has been unable to stabilize above $10,000, its market structure still remains firmly bullish, and investors appear to be increasingly engaged with the market due to its strong uptrend.
This heightened engagement is elucidated while looking at bitcoin’s open interest, which has been hovering at over $1 billion for the past week on BitMEX, showing that traders are widely anticipating further volatility.
Bitcoin’s upcoming mining rewards halving, which is slated to occur in May, is one event that could be leading investors to grow increasingly engaged in the markets, as the event typically translates into notable volatility.
Investor’s current engagement in the markets coupled with BTC’s strong hash rate, heightened network activity, and strong 2020 price action all suggests that the crypto is fundamentally strong at the moment.
It appears that investors are carefully considering all these bullish fundamentals at the moment, as data from Glassnode shows that the number of bitcoin addresses holding over one BTC is growing quickly and is showing few signs of slowing down anytime soon.
Considering the heavy accumulation that investors are currently engaged in, it is highly likely that this will provide BTC with a steady stream of buying pressure that allows it to continue climbing higher.
Clem Chambers shares Cryptoslate’s optimistic outlook. He wrote in Forbes:
Bitcoin is in a bull market and is not having a bear market rally. Next stop is $11,000. Two things are driving this:
1) Coronavirus. Bitcoin is flight/safe haven capital and the global fear of this outbreak is creating demand for BTC. It is the indicator of the spread or otherwise of this worrying disease.
2) The Halvening. Coming in May, likely the 12th, this will drop the mining reward to 6.25 BTC from 12.5. The idea is that this will make bitcoin worth twice what it is now. Maybe it will, maybe it won’t but it certainly won’t make BTC cheaper and if demand for new coins is constant, it will drive the price up over time.
So here is the chart of what we can expect with no shocks cropping up:
It’s hard not to imagine a moonshot happening next but there is nothing to mandate it. When coronavirus is controlled, we can expect a pull back but as I keep reminding myself, the future of the world is full of such events to try our patience and pump “fiat” into flight capital.