Bitcoin (BTC) is poised for a price surge as demand begins to outstrip supply, according to a prominent crypto analyst.
What Happened: "When supply exceeds demand, the asset's price tends to decline. Conversely, when demand outstrips supply, the price usually rises. These same principles apply to Bitcoin," crypto analyst Ali Martinez wrote on X on Thursday.
The recent market dynamics, including a rise in the supply of BTC after it hit an all-time high of over $73,700 in March, led to a corrective phase that saw the price of Bitcoin drop below $57,000. This drop caused Bitcoin to fall below its "Short-Term Holder Realized Price," sparking market fear as short-term holders are more likely to sell based on price volatility, the analyst said.
"The Short-Term Holder Realized Price, which currently stands at $60,500, served as an accumulation point despite investors' fears. Indeed, long-term holders felt comfortable adding more than 70,000 $BTC to their positions at these levels after realizing profits in March," he added.
The Short-Term Holder Realized Price, which currently stands at $60,500, served as an accumulation point despite investors' fears.
Indeed, long-term holders felt comfortable adding more than 70,000 $BTC to their positions at these levels after realizing profits in March. pic.twitter.com/BARIqJM4xH— Ali (@ali_charts) May 16, 2024
Martinez now predicts that the demand for Bitcoin will soon surpass the supply, pushing Bitcoin value upwards. He pointed to the movement of over 30,000 BTC to private wallets for long-term holding since early May as evidence of confidence among holders in Bitcoin's future value.
Why It Matters: Cryptocurrencies like Bitcoin, Ethereum (CRYPTO: ETH), Dogecoin (CRYPTO: DOGE), and Shiba Inu (CRYPTO: SHIB) have seen gains this week after increasing institutional interest in spot Bitcoin ETFs resulted in $1.3 billion inflows in the last two weeks.
The next Bitcoin price target for bulls, according to "Bitcoin OG" Lluciano aka Lucky is $69,000. Crypto researcher Alex Wacy asked if it's "fair to assume that the way to $80K is now open?"
Price Action: Bitcoin is currently trading at $66,877.6, marking a significant 51% increase year-to-date.
