How Bitcoin Is Repeating 2016
As Biden crosses the finish line the U.S. can move pass this event and focus on the problems that still remain. Now, markets in the U.S. are set up to thrive as we have Republicans in the senate making sure Biden doesn’t undo any bills that are business friendly. Money printing will still continue which will help play out the scenario bitcoin is finding itself in.
After the 2016 election, bitcoin soared from $600 to $740, clocking in a 20% increase. Similar to what we’re seeing now, the dollar index (DXY) dropped substantially. Today, bitcoin is trading at a new year high of $14.3k and it doesn’t seem like it’s slowing down anytime soon. With a new record of 100 days above $10k, bitcoin’s credibility will only grow.
Negative-Yield Debt
Negative-yield is something that a nation like the U.S. must be careful with. Apart from macroeconomic consequences, investors will slowly burn themselves if they hold U.S. debt or just plain ol’cash for that matter. Investors will escape through growth-stocks, gold and bitcoin. The graph below shows how bitcoin has been moving in tandem with the volume of negative-yield debt. As you may know, bitcoin is the best performing asset so if you were looking for the fastest way out you would have hopped on bitcoin.
2021
The upcoming year is looking “parabolic”, a term often used in mega bull runs. Institutions continue to come in as Grayscale records an inflow of $215 million to its Bitcoin Trust just last week. Long-term indicators like the stock-to-flow model is proving itself useful once again as we’re getting closer to the next ramp-up in price.
The 200-week moving average crossed $7k for the first time which gives us confidence that we’re past the days of triple digit price range and working to never see a 4-digit price ever again. History has shown us that the years after bitcoin’s halving (2013, 2017), were tremendous years as the created supply gets cut in 2.
Again we can be sure that this time is no different. Being a long-term investor in this space pays off and the strongest hands are the ones that get paid the most.
