Ki Young Ju, founder of CryptoQuant, a cryptanalysis platform, predict a serious “sell-side liquidity crisis” for bitcoin in the next six months. In this case, the founder believes that not only will prices reach new levels, exceeding expectations, but that the crisis will likely cause a market disruption.
bitcoin is trading around new all-time highs following strong price gains on March 11. The currency roared to print new all-time highs of $72,800 before cooling to spot levels.
Although bullish momentum has waned as prices move horizontally as of writing, the bullish trend persists. Consequently, more traders expect btc to break through yesterday's highs as bulls target seven digits to $100,000. If bulls surpass this psychological figure, technical and fundamental analysts say it will be a crucial turning point for bitcoin.
The founder expects bitcoin prices to skyrocket in the next six months primarily due to two factors. The first, Ju notes, is the massive influx of demand from institutions through spot bitcoin exchange-traded funds (ETFs). So far, analysts have linked bitcoin's current rally to institutional demand.
<img loading="lazy" decoding="async" class="size-full wp-image-597523" src="https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg" alt="btc held by entities | Source: Ki Young Ju in X” width=”1024″ height=”663″ srcset=”https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=1468 1468w, https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=460 460w, https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=768 768w, https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=860 860w, https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=750 750w, https://technicalterrence.com/wp-content/uploads/2024/03/Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=1140 1140w” sizes=”(max-width: 1000px) 100vw, 1000px” data-recalc-dims=”1″/>btc held by entities | Source: Ki Young Ju in X
Last week, Ju saw a net inflow of over 30,000 btc. This means that institutions are removing more coins from circulation at an unprecedented level, contributing to the shortage. Institutions and wealthy individuals can gain exposure to btc through spot ETFs without necessarily owning them directly.
Beyond this, the concern lies in the limited number of coins found on centralized exchanges and well-known entities, especially miners. The founder estimates that exchanges and miners hold approximately 3 million btc. Ju explains in the post that entities in the United States hold 1.5 million btc.
<img loading="lazy" decoding="async" class="size-full wp-image-597522" src="https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg" alt="btc accumulation directions | Source: Kin Young Ju on X” width=”1024″ height=”668″ srcset=”https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=1460 1460w, https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=460 460w, https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=768 768w, https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=860 860w, https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=750 750w, https://technicalterrence.com/wp-content/uploads/2024/03/1710260181_557_Bitcoin-Shortage-Crisis-Expected-in-6-Months-BTC-at-100000.jpg?w=1140 1140w” sizes=”(max-width: 1000px) 100vw, 1000px” data-recalc-dims=”1″/>btc accumulation directions | Source: Kin Young Ju on X
The founder notes that growing demand for spot ETFs and limited supply will create a “sell-side liquidity crisis” within six months. This scenario could lead to a situation where there are not enough sellers to meet the high demand from buyers, which would further drive prices to new levels.
The bitcoin network will cut miner rewards by half in April from the current 6,125 btc. Because of this, btc emissions will decrease, meaning that only small amounts of coins will be put into circulation, making the situation even worse.
As such, if the current level of demand holds and institutions continue to double down, the expected shortage crisis will likely cause a major market disruption, benefiting coin holders.
Featured image of DALLE, TradingView chart
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