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Daily Bitcoin and Crypto Analysis

Daily ‌‌Macro And Crypto Update: ETFs + Inflation + Low Exchange Reserves + High Stablecoin Supply = NEW ATH

October 21, 2021

Justin d'Anethan

No surprise here, right. We’ve been talking and expecting new all-time highs for the past few days.

If anything, price action was playing games, maybe clearing the overhang of sellers before we hit $64,800.

Last night, Asia time, BTC powered through and reached new all-time highs. It feels like we needed Americans to wake up and place all those bullish bets. 

The new price record is $67,200. Damn, it feels good.

What happens now? I’m always wary of euphoria, but I also think you have to be out of your mind to short a new all-time high in crypto. We all remember what happened after crossing the 20K mark.

With ETFs becoming a thing now, for crypto, expect to see more cash, not less. BITO already has an AUM over 1 Bil. Valkyries Futures ETF will launch on Friday. There you have it.

Look at exchange reserves of coins. That’s the other side of the story. There aren’t many bitcoins to go around. This is a programmatically limited supply, and even current holders aren’t depositing to exchange. Everyone is holding off for higher prices.

Yet another piece of the puzzle is inflation. There’s a fascinating chart from Galaxy Digital tracking the ups and downs of BTC prices alongside the ups and downs of inflation expectations. And it’s clear that people understand that the value of cash and the relative price of things is about to change, or has been changing, and we’re about to feel the effects. When that happens, the way to protect yourself is to go for real or deflationary assets because of limited supply. That’s Bitcoin for you.

On top of inflation, exchange reserves, and ETFs, there’s another thing I’m looking at: The stablecoin supply, which is essentially the dry-powder, the capital, or the fiat equivalent in the crypto world. Right now, it’s also hitting new heights, suggesting there’s plenty of buying power to take us much, much, further up.

Another great thing that happened overnight is the alts price action. While I mentioned a renewed interest in ETH in the options realm (by the way, it crossed 4K again yesterday), it seems that altcoins all around are getting bought.

The BTC Dominance fell slightly even as BTC gained. That’s actually shocking and super supportive for alts. In any case, whatever you’re holding, don’t forget: Diamond hands.

 


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