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BTC Plunges to USD 9.6K Despite Higher Interest and Restrained Supply

By Linas Kmieliauskas
BTC Plunges to USD 9.6K Despite Higher Interest and Restrained Supply 101
Source: iStock/RobertAx

The most popular cryptocurrency, bitcoin, once again dropped below USD 10,000, despite market players indicate higher interest in this coin and the amount of bitcoin untouched for at least 5 years is at an all-time high.

At pixel time (04:30 UTC), bitcoin trades at c. USD 9,636 and is down by almost 6% in the past 24 hours, trimming its weekly gains to 2%. The price decreased by almost 10% in the past month.

Bitcoin price chart:

BTC Plunges to USD 9.6K Despite Higher Interest and Restrained Supply 102
Source: coinpaprika.com

Other major coins from the top 10 by market capitalization are also in red, losing 4%-9% of their value.

The total market capitalization dropped by almost 6%, to USD 264.7 billion. Bitcoin dominance, or the percentage of the total market capitalization, dipped below 65% for the first time since July 18.

While some "Twitter-based" crypto analysts predict that bitcoin might go even below USD 8,000, Tim Hockey, the outgoing CEO of the major online brokerage firm TD Ameritrade, says that bitcoin is now drawing increasing interest from traders, and they want to trade it.

"Especially given the discussions around Libra and the rebound in bitcoin, there's heightened interest again," Hockey told TheStreet. TD Ameritrade customers can buy bitcoin futures contracts on the CME exchange and the company is planning to lunch cryptocurrency trading "at some point."

Meanwhile, new data from crypto market analysis firm Coin Metrics, shows that the amount of bitcoin supply that has been untouched (i.e. not transferred) for at least five years recently reached an all-time high.
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Also, they stressed that although the size of the bitcoin supply has been consistently growing, the percent of the overall supply of bitcoin that has been untouched for at least five years also recently reached a five year high of 21.6%.

BTC Plunges to USD 9.6K Despite Higher Interest and Restrained Supply 103
Source: Coin Metrics

"This potentially signals that BTC is increasingly becoming a store of value, as opposed to a medium of exchange," the firm said yesterday in its newsletter.

The company added that recent crypto-related regulatory scrutiny to drive crypto capital towards bitcoin, "which thus far has the most regulatory clarity."

Moreover, geopolitical tensions and increased recession expectations "should provide further long-term support to bitcoin prices," Coin Metrics estimated.

Meanwhile, in a podcast released yesterday, Dan Morehead, founder and CEO of Pantera Capital, said that if bitcoin stays on past trend lines it could hit USD 42,000 by year’s end and USD 356,000 a couple years after that.

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