According to the cryptoasset market analysis company, Glassnode, “ETFs may have already been discounted into the price of bitcoin (BTC).” This was stated on January 16 in a report, a week after such cash currency products were approved in the United States.
Glassnode maintains that “several metrics suggest that a non-trivial portion of bitcoin investors treated this as a news selling event.” It was highlighted by a profit taking of 75,000 BTC by hodlers (long-term holders), as shown in the following image.
“The amount of spending for these older hodlers is statistically significant,” the analytics company emphasized. In fact, it contributed to the largest profit-taking since bitcoin reached its all-time high price in November 2021. This can be seen in the next chart.
These types of events “are relatively rare, however, they often align with uptrend markets encountering significant resistance,” Glassnode warned. Therefore, he suggests that there could be a pause before the price of bitcoin resumes its rise .
Resistance is called a price zone in which there is greater supply than demand, which prevents its rise and encourages its relapse. This is what happened with BTC when, after the launch of the ETF, it fell from $49,000, its highest in more than two years, to around $42,600.
“The key question before us is whether the influx of demand from ETFs, either in anticipation of the halving in April, or from humble and reliable hodlers, will be enough to overcome this resistance,” Glassnode distinguished, as a glimpse the factors that could drive the price of bitcoin .
The approval of the BTC spot ETFs in the United States “marks the end of the maturation phase of bitcoin and the beginning of its growth stage,” since it gives the currency access to the largest stock market globally. Therefore, it could motivate the rise of the currency, which could be reinforced by the next halving (halving of the BTC issuance), since this event reduces the supply.
Jurrien Timmer, the head of global macro at Fidelity, one of the companies that launched a spot bitcoin ETF last week, told Glassnode that current trends in the price of bitcoin suggest difficulty in continuing the rise in the short term.
“My guess is that it will take a little time to consolidate the recent gains, now that the big moment has arrived,” he said. However, he clarified that, in the medium and long term, ETFs could attract new demand to the market that reactivates the rise .
“Will this be a new chapter towards the widespread adoption of bitcoin as a commodity currency? It seems so, although it could take some time to get there,” concluded the Fidelity executive.
