Just like October was packed with companies reporting earnings, we expect the beginning of November to be bolstered by the same kind of enthusiasm, given that so far most numbers have been good, despite all the supply chain constraints one might have taken into account. Right now equity indexes are staying strong near or at all-time highs. This week, will also see a Fed meeting, which many expect will see the $150 billion bond buyer program end or at least slow down. It’ll be fascinating to see how markets react.
In the crypto space, there’s definitely strength as well. Just on Friday, ETH was hitting new all-time highs which, in my mind, is the gunshot that starts an altcoin race higher.
This morning, BTC is hovering above $61,500 and ETH is around $4,300. Definitely not bad. We’ve seen some outperformance from coins like MATIC, GRT, CURV and NANO -all four coins have risen in the past week by between 15% and 20%.
On the other hand, it’s important to note that some altcoins haven’t woken up yet, even retraced down, actually, I’m thinking of STX, ADA and DYDX, down throughout last week.
Back to BTC, there are two must-see charts, one published by CryptoQuand and another from CoinMetrics. In the first, we can see the all-exchange bitcoin reserve rising during 2018 and 2019 but, now, since 2020, in an inexorable downtrend -coinciding with last year’s halving.
The other chart, more recent but just as significant, shows a growth in medium/long-term holders. We can see that addresses holding coins for more than six months are growing steadily.
Put the two together, and you see an environment where holders aren’t parting with their coins and expect higher returns, this means less coins to go around on exchanges and takes us to where we are now, at higher prices.
While this looks at BTC, it’s also interesting to see a similar dynamic with ETH. And it’s actually exacerbated by the staking/locking of ETH that’s ongoing and ETH burns that take place. The last two actually sometimes make the daily issuance of ETH negative not positive, so we’re daily having less ETH to go around, not more, which is just super powerful for price. And we can see it playing out now.
Maybe the last graph I wanted to show is the renewable energy share of BTC mining which has grown to about 58% and is much higher than the world average, showing that the space is actually leading efforts in the right direction.
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