A perfect storm - The number of Tethers keeps rising while the price of BTC keeps going higher
The perfect storm is brewing for bitcoin prices...
When the price of Bitcoin goes up, one might assume the buying pressure is coming from stable coins...
However, that is not the case currently.
A quick glance at this chart shows that the number of tethers in circulation is going up right along with the price of bitcoin.
Something that one might not expect if money was simply sloshing from crypto asset to crypto asset....
(Source: https://twitter.com/eliasimos/status/1327168782436020224/photo/1)
Instead we are seeing both rise together, which can only mean one thing...
Can you guess what that one thing is?
It means new money is coming into the market and new money is moving both into tether and BTC.
The more money that comes into the crypto market the better, even if it doesn't all go into BTC right away.
Tether, and other stable coins, have long been looked at as dry powder so to speak, representing potential buying power for bitcoin should the right catalyst present itself.
And as it stands right now there has never been more dry powder available for ol bitcoin, even at a time when it is climbing ever closer to its all time highs.
The perfect storm is brewing indeed.
Stay informed my friends.
-Doc
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How do u explain then this chart. Open interest is going down from 2nd Octuber.
Short Covering (Unwinding) Price up y OI Down Here the price increases with the OI decreasing. This means that the people who had entered into a short position are closing their entries. This generally occurs after the price has made a substantial correction. The Open interest data when studied with Price movement, becomes a very strong indicator to be used with Price Action Trading.
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Open interest has nothing to do with tether...
I think I see the relation because OI it's a good way to see if there are new actors entering the game...but I told you more for bitcoin than for tether of course.
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Am surprised why other altcoins are not performing the way bitcoin is doing
Yea I think you are not alone with those feelings. Traditionally bitcoin tends to move first, and then altcoins tend to follow later on. This time around it may take bitcoin making new highs before altcoins really join in on the fun, at least that was the happened back in 2017...
Oh that means altcoins season is just round the corner
I think we're very much on track to follow the 2017 analog. The more I think about it, the more we talk about it, and the more I realize just how organic it all is, the more I realize that it's highly probable that history rhymes, and oh, how so!
Absolutely correct.
Just one more indicator that says it's Jan. 2017 all over again. Money will overflow now just like it did before. Lookout quality crypto, you're on the hit list! 🤑
Now we just have to make sure HIVE is included on that list! How do we do that by the way? :)
Been thinking about that.
Other than what we're already doing every day?
Real investors, those who do real DYOR, will find us, don't you think? We're not that crazy, are we?
In all honesty I know for a fact that some investors don't like the 20 consensus witness number. In essence we are trusting our money with 20 unknown people, in fact it's actually less than that considering they could fork with less than that. If that consensus witness were changed to something larger, like say 100 or so, I know that would help but I have mentioned that several times and no one seems to bite. Apart from that HIVE needs to have a reason for someone to invest, right now there are not many. Park your money so that you can post and vote every day to slightly stay ahead of inflation? That doesn't appeal to many out there... we need passive ways to earn that well above the inflation rate to really attract people. And you need to market it once you have it.
I'm another who thinks we need to expand the number of witnesses. I'd go for a doubling or so, but I get the impression that there is a certain prerequisite technical knowledge level required, and that's the main reason for hesitancy on the part of "the status quo". There's surely important infrastructure overhead as well. I can appreciate the arguments in the name of caution for the sake of network security. One idea I've seen mentioned that I would get excited about as a short term, stopgap measure would be reforming the selection process by making it more representative of the choice of current active users. That means that all 'stale votes', votes made years ago by people who are no longer around, automatically decay and 'fall off' after a stipulated period of time, for example. That in itself would shake things up pretty well. Of course, the shock to the system would be mitigated by a democratically 'weighted HP' vote, but the shake-up caused by the need to replace all those lost stale votes would not go unnoticed by any means. This necessarily would lead us to 'campaigns' and perhaps a better education for all concerned regarding who is doing what. The process would be very positive for HIVE, I would think. What with all the hype surrounding "governance" these days, here we've got it built in already so why not flaunt it as well as use it?
This is one of the things I've been reflecting on for a while but kind of had on the back burner until HF24 is completely out of the way - another impression I have: that I'm not alone in that temporary laidback attitude - and I think perhaps the priority issue to be dealt with once we get back to moving forward. The physical break with STEEMIT had a big cost, probably much bigger than most of us realize.
Thinking about it, we really haven't done too badly. We've set the foundation in place! Now it's time to build!
I believe there is already talk to have witness votes decay after 1 year or so... That would certainly help.
I've seen it mentioned. I can't remember where. Probably one of @blocktrades posts. But I don't remember seeing it much more than that. This would be a step in the right direction that could be highly leveraged from the publicity angle. First it needs to get some internal traction though.
The difference is that, this time, the money is a lot bigger. With institutions starting to play in this arena, the numbers are much larger than before.
Think of the $425 million from Microstrategy. We did not have buyers like that in 2017.
It is going to be fun to watch when it does hit.
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I think you've got an important point there.
No truer words were ever spoken about the cryptocurrency industry. Without a doubt, more money coming in only makes the industry larger and stronger. Part of the issue, at the moment, is the fact that the entirety of it is so samll.
However, with more money coming in, it will push prices up that make the entire industry larger. With that size will come resiliency.
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Yep, and based on what I think is eventually coming, we are going to need all the resiliency we can get!
I tend to think you and I are thinking the same thing. And yes resiliency is a must. Things have to go far and wide...and quickly.
There are some strong forces that have a vested interest in crypto not surviving unless it is controlled by them.
They are not going to walk away without a fight.
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Yep exactly. I think we are thinking the same thing indeed. Getting billionaires on our side is big and can't be over-stated. They can hopefully get politicians etc on their side as well.
This time I feel the BTC moving is different to 2017, when altcoins were very similar in moving to BTC. Or maybe we are not yet in same moment?
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Thank you for this post, but maybe I have another point of view.
Frankly, I think that the 2017 hype had more bad effects on crypto space than benefits. One of them that it attracted some fresh greedy investors who cared more about making money and less about development which eventually caused a dramatic crash in 2018.
I'm a bit concerned that such a hype would once again bring unwanted attention of those new investors who care about nothing but making speed profits and running away.
Of course, part of me would surely enjoy watching Bitcoin more than $20k again, but I wouldn't be happy if that caused it to be viewed by the media as a pump-dump asset.
Personally, I think I prefer seeing slow but steady Bitcoin price growth instead of going through another intense bull run.
Thank you again for this nice post :))