There’s no doubting the BTC price upside, but under the hood, all is not what it seems, one analyst highlights.
Bitcoin (BTC) is getting compared to late 2020, but this rally in fact has several major differences that make it “not normal.”
According to Pete Humiston, manager of Kraken Intelligence Research, Bitcoin in Q3 2021 is a different beast when compared to Q4 2020.
Despite going from $29,000 to $48,000 in just one month, Bitcoin is still not seeing a frenzy of interest and buying.
Higher price levels have seen solid support, but there is little evidence of the kind of demand that characterized the start of this year or the end of the last.
A case in point is the Grayscale Bitcoin Trust (GBTC), which continues to trade at a discount of around 13% to spot price this week.
Even though Bitcoin has increased in price, GBTC demand has not entirely increased in step, and even the discounted rate is not being treated as a steal by many institutional investors.
At the depths of BTC’s price retraction, the GBTC premium stood at around -20%.
Both contrast with the start of the 2020 bull run and go against the grain, given the pace of price increases over the past month.
“In the time that we’ve seen $BTC move from $30K → $48K, open interest has fallen, and the bitcoin perp. funding rate is still relatively low (albeit positive),” Humiston added.
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