By Nancy, PANews
Entering November, the encryption market experienced a violent shock. In the early hours of 5 November, Bitcoin fell at a critical psychological juncture of $100,000, setting a new low of almost five months. With that, the market panic rose rapidly。
Bitcoin is facing a downswing in funds, and long-term currency holders are falling sharply
Behind the weak movement of Bitcoin is not simply a burden of macro-uncertainty, but a crucial shift in financial resources。
According to CryptoQuant data, over the past 30 days, more than 327,000 BTCs have been sold by Bitcoin long-term holders. Since the beginning of October, there has been a continuing trend towards net outflows, with long-standing currency holders holding almost steady at around 300,000 BTCs, reflecting weak market confidence and liquidity pressures. Despite several attempts by Bitcoin to rebound in mid-October, each move was accompanied by a significant outflow of funds, which meant that the rebound lacked additional funding and insufficient market momentum。
At the same time, there have been subtle changes in the financial movement of the ETF market. According to SosoValue data, the cumulative net inflow of the United States-based Bitcoin-based ETF was $3.42 billion in October, which, to some extent, strongly underpinned the spot price of Bitcoin in early October. By the end of the month, however, there had been a reversal, with a net outflow of $1.33 billion over the past four days alone. Of this amount, the goldiest Beled IBIT was redeemed at $291 million, the largest single-day outflow since early August. ETF financial changes are often seen as &ldquao of institutional sentiment; thermometers & rdquao; and current financial changes indicate a clear shift in the short-term attitude of institutional investors towards prudence and a decline in market optimism。
The same signs are at the company level. SosoValue data show that, in October, global listings (excluding mining companies’ total net purchases of some 7251 BTCs) were made. However, behind seemingly robust figures, structural changes were hidden, with about 85.1 per cent of purchases concentrated in the first week of the month, followed by a significant decline in growth. Large buyers, including Strategy and Metaplanet, generally slow down the sweep。
As a result, the scale and sustainability of the new funding currently available in Bitcoin are no longer sufficient to offset the continuing pressure on long-term currency holders and the supply and demand structure of the market is facing a phased imbalance。
Collective pressure on mining companies and institutions, market entry cost games
The recent price movements of bitcoin have put the market nerves back on hold. As Bitcoin fell to the $100,000 threshold, multiple market pressures were gradually emerging. Although there are still no panic sales in the market as a whole, multiple signals suggest that Bitcoin is at a critical stage in a cost line game and structural test。
According to Marco Micro, the average cost of production of Bitcoin had risen to approximately $114,000 as at 4 November. This means that the cost of mining is already higher or closer to market prices for most mining companies. At the current price level, many mining companies have not only sharply reduced their profits from mining, but have also had to cope with additional cost pressures such as marketing, administration and energy, which have become the primary task for mining companies to sustain their operations. If market demand is further reduced, some mining companies begin to seek business diversification to hedge cycle risks, including a shift to AI infrastructure construction and computing leasing。
Institutional holders are equally under significant pressure. SosoValue data show that out of the 38 listed companies worldwide that hold Bitcoin, at least 24 holding prices have fallen through the cost line, including Metaplanet, Bullish, Galaxy Digital, and Next Technology. Even the head office of the industry has difficulty maintaining bookkeeping gains in the current zone, and even a small portion of DAT’s company has started a reduction due to liquidity pressures, such as US stock listing BTC Treasury, Sequans, confirming that 970 bitcoins have been sold to reduce debt。
On the technical side, many practitioners believe that there is a risk of further decline in the market in the short term. According to Katie Stockton, founder of Fairlead Strategies, Bitcoin has broken the critical 200-day moving average (approximately US$ 1098 million). The 200-day mobile mean line is one of the indicators that has received the most attention in defining long-term trends and also serves as the backbone of Bitcoin. This may signal that the encrypted currency will go further down, with the next target or a look at $94,200; 10x Research CEO Markus Thielen recently indicated that Bitcoin is approaching the support line since the collapse of 10 October. If you break $107,000, you may look down to $100,000; Matrixport analyses indicate that Bitcoin is now close to the 21-week moving mean, an indicator that has repeatedly been a sign of inversion throughout history. While the current trend may have the potential for further exploration, it does not mean an end to the situation. This reminds investors that instead of being disturbed by short-term market volatility, time-tested indicators should be used as a basis for stability in decision-making。
Bitcoin restructuring of supply and demand, and the emergence of opportunities for patient investment
Market sentiment is not entirely pessimistic. Analysis of glassnode data indicates that bitcoin has maintained an inter-zone shock trend this week and that market dynamics have improved, but inflows have slowed. ETF capital outflows and declining profitability indicate that the market is in a sustained state of relative equilibrium. Since July, Bitcoin has been repeatedly blocked from the warehouse-carrying line of high-profile buyers, indicating a heavy upturn and a possible return to key support areas of approximately $104,000 in the short term. Historically, the phase of short-term holders' subjugation or even surrender has often provided patient investors with more attractive build-up opportunities。
Wintermute wrote that global liquidity was expanding, but that funds did not flow into encrypted currency markets. ETF inflows have stagnated since the summer, BTC ETF management assets have hovered around $150 billion, and DAT activities have been depleted. The four-year cycle concept is no longer applicable to mature markets, where the current market structure is healthy, leverage has been cleared, well-positioned, liquidity is a key driver of performance, and ETF inflows and DAT activities will be closely monitored, which will be important signals of liquidity re-entry into encrypted currency markets。
Matt Hougan, Chief Investment Officer of Bitwise, stated that, while Bitcoin had fallen by $100,000 and had been at a new low since June, raising concerns in the market about the cold winter of encryption, he believed that the current situation was closer to the bottom rather than the beginning of a new round of long-term bear markets. Bulk investors are currently in an extremely desperate phase, with a high level of leverage clearing and a new low level of market sentiment; however, institutional investors and financial advisers remain multi-minded and continue to deploy encrypted assets such as bitcoin through ETF channels. Institutions are becoming the main driving force of the market. The bulk-encrypted investor's sales were approaching depletion, and he believed that the bottom of the price of the currency was about to appear and that it would be sooner than expected. Its Bitcoin still had the opportunity to reach a new high this year, with prices likely rising to between $125,000 and $130,000, with an ideal move that could even reach $150,000. As institutional buyouts continue to grow, the next phase of the encryption market will be driven by more rational capital。
The founder of BitMEX, Arthur Hayes, has released a long-term update stating that the United States Treasury Department and the Federal Reserve are preparing a &ldquao; the Invisible QE (Stealth QE) &rdquao; or a key catalyst for a new round of increases in bitcoin and encrypted markets. Currently, spending by the United States Government is expanding, preferring debt to tax increases. Foreign central banks are more likely to buy money because of dollar asset risk, and private savings rates in the United States are not sufficient to support the issuance of national debt, while four major commercial banks absorb only a small portion of new debt. & ldquo; relative value hedge fund ” off-the-shelf purchaser, financed by leverage from repurchase agreements. The United States Treasury Department expects to issue approximately $2 trillion annually in new debt to cover the deficit. In times of tight liquidity, the Fed invests in the market through a standing buy-back mechanism, equivalent to “ disguised as QE&rdquo. As the use of the mechanism increases, global dollar liquidity increases and results equal to QE. Hayes predicted that this would rekindle bitcoin and encrypted markets for cattle. The current government pause and the short-term tightening of liquidity due to the sale of national debt suggested that investors should keep capital and wait for time, known as “ the invisible QE” and that the market would rebound strongly after start-up。
From the point of view of chain finance and currency holding structures, the current Bitcoin market is experiencing a structural test of supply and demand imbalances. Data analyst on the chain@Murphyanalysis indicates that bitcoin is currently experiencing supply and demand imbalances in &ldquao; the structural test &rdquao; and that long-term holders have continued to sell in large quantities in the recent past, and market demand is not sufficient to fully absorb these shocks. this group of holders sells because they still have higher profits, but their profit space is being compressed as prices resonate. in historical experience, when the average daily distribution of long-term holders falls to less than 15,000, markets are usually able to stabilize again. they have achieved gains and losses down to “ alert line ” and below, there is a marked reduction in sales opportunities and market pressure. at the historical tempo, this adjustment period may last another one to two months, or the arrival of a trend transaction。
CriptoQuant CEO Ki Young Ju notes that the current unrealized profits of giant whales are not high, suggesting that the market has not yet entered the fanatical phase or that it is difficult to recover high profits due to the expansion of the Bitcoin market. At the same time, bitcoin is constantly innovative and mining is expanding, showing clear signs of long-term growth. Current demand has come mainly from ETF and Strategy, but both purchases have slowed in the near future and, if growth is restored, market dynamics may be restarted. Short-term blubbers (mainly ETFs) are close to the balance of earnings and losses, with long-term blubbers earning about 53 per cent, traditional four-year cycle patterns are weakening and future sources and size of mobility are more difficult to predict. In addition, the average cost of holding a bitcoin was approximately $559 million, with an average profit of 93 per cent for holders, and the chain-based inflow remained strong, but the main reason for price stagnation was weak demand rather than pressure to sell。
QCP Capital, the encrypted investment agency, pointed out that recent sales lacked significant macrodrivers, even though other risk assets performed well in terms of policy profitability. Over the past month, some 405,000 OG holders were absorbed in the market in bitcoin, which did not fall by $100,000. Despite the slowdown in the growth of listed companies and the sale of some small digital asset reserve companies, spot prices were maintained. Currently, long-term holders have benefited, and institutional capital inflows and extension are consolidating the market base。