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GBTC discount hit all time high, so where will Bitcoin’s price head next?

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Grayscale Bitcoin fund products have traded at average discounts of 4.66% and 4.34% compared to NAV (net asset value) throughout March. This comes at a time when Bitcoin’s price has dropped over 8% in the past 24 hours.

Grayscale’s recent formation of five new trusts for alts like BAT, LINK, MANA, FIL and LPT, comes at a time when the institution has dabbled in bona fide ETF products, despite taking a step back from launching new creations for the flagship Grayscale Bitcoin trust.

Most investors may soon move on from GBTC and Grayscale’s ETF products. With more Bitcoin ETFs getting launched there is an arbitrage trade in shorting GBTC and going long on Bitcoin. ETFs are primarily built to have a zero NAV premium and this implies that the position was meant to be swapped with Bitcoin for the ETF. That is when the current liquidation of BTC longs, and increasing shorts on Deribit and FTX will cool down to allow Bitcoin’s price to recover.

Where is Bitcoin's price headed next, after GBTC discount hit all time high

Source: Bybt

There are several factors influencing the current price action, and retail traders can expect the correction to the $45000 level this week, like institutional flow that slowed down while total AUM increased to $58.7 Billion.  Average weekly asset inflows across all major cryptocurrencies decreased by 70.5% since February 2021, to the $149.6 million levels.

The total AUM across Grayscale’s Bitcoin Trust product dominates among others in the industry. However, GBTC premium to NAV has been consistently dropping. It is currently at a negative 14%. Bitcoin holdings of Grayscale have plateaued since the beginning of February 2021.

GBTC’s trade volume has dropped 22% since the same time and currently amounts to a daily average of $525 Million. Compare that to Bitcoin trade volume, which is up 47% in the past 24 hours, however, post the change in the HODLing pattern, this could be retail traders selling BTC for DeFi and altcoins on exchanges.

Though premiums have been dropping since January, the rally of the alts and the DeFi tokens, the inflow of funds from Bitcoin to DeFi through WBTC has increased consistently. There is competition from alt investment products, and Grayscale has invested in top-performing altcoins, thus increasing the competition.

Though purpose Bitcoin ETF hit $1 Billion in AUM on March 19, 21, nearly a week since then has passed and the price has dropped 11.89%. Retail traders can expect a drop in price to the $45000 level if the discount on GBTC continues increasing and there may be a further drop in price over the weekend.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/gbtc-discount-hit-all-time-high-so-where-will-bitcoins-price-head-next

Blockchain

Bitcoin: Should retail traders expect a price hike?

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Bitcoin’s large wallet inflows signal a bullish trend reversal in the following week. The price is currently around the $60000 level, however, with the increasing trade volume across spot exchanges, an increase of nearly 15% in less than 24 hours, there may be a bullish trend emerging in the asset’s price.

Why this metric signals the upcoming Bitcoin price trend reversal

Bitcoin Large Wallet Inflows || Source: Twitter

Based on the above chart, Bitcoin is in price discovery mode above $60045. There is strong support at the $57000 level and this is also a psychologically important level for Bitcoin. The current bullish price trend is further supported by the demand across exchanges. Buying bitcoin and selling June futures currently offers a 30% annualized USD denominated “risk free” return. A 3-month US Treasury bill yields 0.02%, which is 1500x less.

When Bitcoin’s price ended March with a 30% increase, it marked the sixth consecutive month of double-digit positive returns for traders. Historically the second quarter is considered a positive yielding quarter for Bitcoin. Bitcoin returns over 250% in the second quarter, based on the price chart. The current price is following this trend and the recovery from the drop below $60000, which was partly attributed to HODLers and partly to large wallet inflows is signaling a bullish trend. There is a spike in funding rates as the price nears the ATH. This is another sign of the bullish price action in Bitcoin.

Why this metric signals the upcoming Bitcoin price trend reversal

Bitcoin’s perpetual swap funding rates || Source: Skew

Based on the above chart, the increase in perpetual swap funding has corresponded with previous ATH as well. The current spike in perpetual swap funding can be considered to be an indicator of the next ATH and the bullish price trend. Traders can expect price discovery beyond the new ATH if the momentum and volatility increase consistently over the week.

Another metric that signals this trend is Bitcoin’s miner revenue. It just reached an ATH of $6.1 Million. The previous ATH was hit less than 10 days ago, on April 1, 2021. For retail traders, looking forward to long Bitcoin it is becoming cheaper to hedge the risk. The cost of hedging against a price drop using options is dropping. A large basis spread has opened up between CME Bitcoin Futures and the offshore market. This means compared to traders on other platforms, traders on CME don’t see much upside in Bitcoin, going forward. These traders are institutions, however, retail traders are relatively more bullish on Bitcoin.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/bitcoin-should-retail-traders-expect-a-price-hike

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Cardano, Bitcoin SV, Compound Price Analysis: 11 April

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Cardano saw a trend of falling trade volume that showed a market possibly in a phase of distribution. However, in this bull market, another leg upward can not be discounted. Bitcoin SV formed a bearish divergence and Compound saw demand rise at the $440 area.

Source: CoinStats

At the time of writing Bitcoin was trading at $59,656 with a marginal drop of over 1.5 percent in the past day’s time.

Cardano [ADA]

Cardano, Bitcoin SV, Compound Price Analysis: 11 April

Source: ADA/USDT on TradingView

Cardano showed a lack of movement in price on the charts over the past few weeks. The range from $1 to $1.47 has its 50% mark at $1.21, and that is a strong level of resistance for the price. ADA has bounced between the $1.17 and $1.21 levels, and buyers and sellers are in equilibrium, according to the OBV.

There is an upper and lower boundary on the OBV that needs to be broken to confirm a move above $1.34, or below $1, in the weeks to come. However, this will take time to develop, and the $1.2-$1.3 area is likely to be a supply till the OBV starts ticking higher to show increased demand.

Bitcoin SV [BSV]

Cardano, Bitcoin SV, Compound Price Analysis: 11 April

Source: BSV/USDT on TradingView

Bitcoin SV showed a bearish divergence between price and momentum. This was not an immediate sell signal, but it showed an overextended move and a pullback to the $260 area can be seen. The Stochastic RSI was also in the overbought area.

While individually neither indicator can be taken to show a sell signal, taken together and with the fact that trading volume is trending lower even as price reaches higher, the conclusion can only be that BSV is due for a pullback.

Compound [COMP]

Cardano, Bitcoin SV, Compound Price Analysis: 11 April

Source: COMP/USDT on TradingView

COMP formed a descending triangle pattern in the past month and broke out strongly to climb to the peak of the pattern at $520. COMP was able to touch $550 before selling pressure forced it to trade at $451 at the time of writing.

In the past few days, COMP has formed equal lows at $443 even as the Awesome Oscillator began to move back toward the zero line. This showed that bearish momentum was slowing down. The Chaikin Money Flow also climbed back above the +0.05 mark to indicate capital flow into the market was on the rise, a sign of demand for COMP.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/cardano-bitcoin-sv-compound-price-analysis-11-april

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Where are these altcoins headed ETH, DOT, ADA, UNI?

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Based on price action in March and the first 10 days of April, a trend has emerged on the price charts of ETH, DOT, ADA, UNI. Among others, these altcoins have witnessed a fair share of price rallies and consolidation over the past month. In the case of ETH, after outperforming Bitcoin consistently throughout March, by +36%, ETH’s price failed to cross the psychologically important price level of $2000.

After Feb 2021, the price crossed $2000 in April, and this was critical to ETH’s price rally. Leading alts to a bullish week, ETH hit a new ATH of $2197 earlier on April 10, 2021, with over 12% dominance. The rally is clearly in price discovery mode and sentiment continues to remain bullish. The relationship between ETH’s volume and volatility and its impact on price becomes clear from the following chart.

Where are these altcoins headed ETH, DOT,ADA, UNI

ETH volatility vs trade volume || Source: Kraken Report

Based on the above chart, the volatility has a direct correlation with the trade volume and the price of ETH. The volatility is currently at the 2020 average level, and the trade volume is above that level. In the case of DOT, the first week of April was bullish when compared to March, and the prices remained largely below the $45 level in March.

With the launch of Parachain auctions and crowd loans, DOT’s price climbed to the $45 level. For DOT, the 1-month return was nearly 10%, 3-month at 300%, and the annualized trade volume has hit 95%. DOT’s current price level and the trade volume signal that DOT may remain largely rangebound for the following weeks.

ADA’s price rally could not be sustained, the correction in March 2021 led to a price drop of over 10%. ADA’s volatility and trade volume share a similar relationship with Ethereum, and it has an impact on the asset’s price in the short and long term. After over three rounds of alt rallies in the current market cycle, ADA may have slowed down, to consolidate before the price climbs higher.

Where are these altcoins headed ETH, DOT,ADA, UNI

ADA Volatility vs Trade Volume || Source: Kraken Report

UNI with a market capitalization above $14 billion ranks in the top crypto assets, Uniswap V3, and the upcoming mainnet launch were key events that had an impact on UNI’s price. UNI ranks as the fourth largest DeFi app with a high TVL. UNI is likely to rally now, with steadily increasing trade volume. Among top DeFi tokens that made a comeback after ETH’s price crossed $2000 earlier this month, UNI made an impact by hitting $32, which is close to its ATH of $36 from March 2021, based on data from CoinMarketCap. The current on-chain metrics and UNI’s trade volume signals a bearish trend in the asset’s price.


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Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://ambcrypto.com/where-are-these-altcoins-headed-eth-dotada-uni

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