Bitcoin ‘supply shock’ could amplify price in coming months — Sygnum

Bitcoin is entering a period of supply shock that could have more dramatic price implications than in previous cycles, Katalin Tischhauser, head of research at digital asset banking group Sygnum, told Cointelegraph.

“Large demand will have a strong multiplier effect, meaning every $1 of demand leading to, say, $20-30 additional market capitalization,” she said. “We have already seen this multiplier effect after the launch of the Bitcoin spot ETFs or around the US elections.”

Tischhauser cited the limited liquid supply of Bitcoin (BTC) relative to the large pools of institutional capital on the demand side as a reason for a possible spike in BTC price over the coming months.

“This liquid supply has been falling steadily over the past 1.5 years, not least because of the proliferation of Bitcoin acquisition vehicles such as Strategy, Twenty One Capital, and others,” Tischhauser said.

She also noted structural factors contributing to a bullish forecast for BTC, including the increased regulatory clarity, macroeconomic pressures, and Bitcoin’s growing appeal as a deflationary asset.

Bitcoin exchange-traded funds (ETFs) have seen just four days of outflows since April 16.

Related: Bitcoin price will reach $130K or even $1.5M, top bulls say

Bitcoin consolidation a ‘healthy pause’

Derive founder Nick Forster told Cointelegraph that the asset will likely see a “phase of consolidation,” which he classified as a “healthy pause.”

The pause will allow “the market time to digest recent gains and gear up for the next phase.” Some analysts are calling for much higher price targets, some in the realm of $200,000 to $300,000.

Magazine: Danger signs for Bitcoin as retail abandons it to institutions — Sky Wee

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