3min chapter

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#1321 Bitcoin Update: All-Time High and Where We Are Headed

The Pomp Podcast

CHAPTER

Bitcoin Demand Surge, Halving Impact, and All-Time Highs Analysis

Exploring the rising demand for Bitcoin following ETF approval and ahead of the halving event, examining supply-demand dynamics, price implications, historical trends, and Bitcoin's strong year-to-date performance as a risk-reward asset.

00:00
Speaker 1
And so Bitcoin was a big beneficiary. Then, of course, January 11, 2024, we get the approval of the Bitcoin ETFs. 11 ETFs are all rocking. The response from the institutional world has been greater than I think anyone thought was going to occur. We have seen at this point, just one fund, just BlackRock alone, has over $11 billion in assets in their fund. We've had over $8 billion in net flows. And we are seeing that there is at least 12 to 14 times more demand every single day than there is actual Bitcoin that is being produced by the network. Why is that important? Well, if you have more demand than supply, then the price has to go up. Again, Economics 101 class. But the beauty of the Bitcoin network is that Bitcoin does not respond to increases in demand. If you saw gold or other assets have more demand, people would go invest money to create more supplies so that they could satisfy the demand. The market would try to find an equilibrium. Here, there is no ability to create more Bitcoin. And therefore, what you get is that you see lots more demand than supply. Supply doesn't change. Price has to go up to accommodate everyone. And then we look on the horizon. We have the Bitcoin having coming in less than 50 days. We will have that Bitcoin having. So although there are 900 Bitcoin a day coming into the market, that will drop down to 450. Why is that number important? Well, if we're already at 12 to 14 times more demand than supply and we get the supply cut in half in terms of the daily incoming supply, that means we could be at 25 times more demand than supply. If demand continues to be at the level it is and if the having correctly executes as it has done in the past. So that means that there is likely to be much, much more demand in the future than supply incoming every single day. But not only is that occurring at the same exact time, Bitcoin punctured the new all-time high. It was only by tens of dollars, 20, 30 dollars, but still it did touch a new all-time high. In the past, we have seen three of the four times that Bitcoin has broken through the all-time high, but the price of Bitcoin has doubled in 18 days or less. Dylan McClayer, a great Bitcoin analyst, came up with that analysis that showed three of the last four times that Bitcoin set a new all-time high price. Bitcoin's price doubled in 18 days or less. Pretty incredible. Now, does it count if it only went 20 or 30 dollars up? It does. It depends. We did see one time where Bitcoin, according to Alex Thorne, the head of research at Galaxy Digital, went up. It tapped the all-time high just slightly above. It did it a second time. So twice tapped on that new all-time high. It then consolidated for about two to three weeks. And then it finally did puncture the all-time high and led to a rapid appreciation of the price. And so that's my expectation now, is whether it happens right now or in two to three weeks, once we're fully through breaking that $70,000 threshold, that's my guess of when we will start to see a rapid appreciation of Bitcoin. I say rapid appreciation, how quickly does it happen? What's the timeline? That's anyone's guess. I can't tell the future any differently than you can. But what I do think is interesting is that Bitcoin is up 62% year to date. That is the single best performing asset so far this year in terms of asset classes. Now, as ZeroHedge pointed out, the sharp ratio is 2.1, which also is quite attractive. So Bitcoin continues to remain one of the best risk reward assets that you can allocate capital to.

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