Institutional Investors Sweeping Up Bitcoin: A Signal for Breaking $100,000?

▲ Bitcoin (BTC) ©Dasol Ko

Institutional investors are vacuuming up Bitcoin (BTC) from the market at a rate five times faster than the supply newly minted by miners. Given that such massive accumulation in the past has invariably led to strong price surges, expectations are at an all-time high that an unprecedented bull market, breaking through $97,000, could unfold soon.

According to crypto media outlet Bitcoinist on May 5 (local time), Charles Edwards, founder of Capriole Investments, recently highlighted the aggressive accumulation of Bitcoin by large capital on his social media. To understand the overall investment trends of institutions, he analyzed the combined changes in holdings of corporate treasury assets and exchange-traded funds, which are key channels for indirect Bitcoin investment.

According to data shared by the analyst, the recent rate of change in institutional investors' total Bitcoin holdings has surged vertically, indicating a massive influx of capital into the market. It is understood that buying pressure has exploded in both corporate treasury asset inclusion and the exchange-traded fund market, strongly boosting the overall scale of institutional accumulation.

Notably, the current intensity of institutional buying has far exceeded the new supply generated by the Bitcoin network. Charles Edwards explained that institutions are absorbing more than 500% of the new Bitcoin supply mined daily. While the rate of change in Bitcoin supply has halved after the halving event, the appetite of large capital has exploded, making a severe supply shock visible.

The expert emphasized that in the past, whenever institutional buying pressure reached this level, the Bitcoin price invariably showed a strong bull run. According to his explanation, looking back at previous instances, the average return over one month after such large-scale accumulation was 24%. If the same historical pattern repeats this time, calculations suggest that the Bitcoin price could soon surge vertically to the $97,000 mark.

However, the market's attention is focused on whether this explosive buying trend will continue. Whether the current steep accumulation trend will persist without wavering, or if it will remain a short-term phenomenon and enter a consolidation phase like last March, is emerging as the biggest determinant of Bitcoin's future price direction.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*