Despite the Bitcoin price failing to properly clear the $43,000 resistance over the past week, it has not stopped traders from taking their positions within the digital asset. According to studies, the Bitcoin transaction volumes have reached their highest factors in virtually two years, exhibiting a willingness from traders to enter the market even at elevated costs.
Bitcoin Sees Elevated Transaction Volumes
Data from The Block has proven that Bitcoin continues to witness elevated buying and selling volumes, culminating in new yearly highs in January. According to the chart, these elevated buying and selling volumes started on October 2023, which coincides with the time when anticipation round a possible Spot Bitcoin ETF approval first started.
From October 2023, the Bitcoin transaction volumes noticed a gentle climb, with every month recording greater volumes than the final. Then, to begin out the yr 2024, January would smash all of 2023’s information as transaction volumes rose over $1 trillion in a single month.
These elevated transaction volumes are a testomony to the optimistic sentiment that has adopted the Spot Bitcoin ETF approvals. This is coming regardless of decrease transaction numbers on the blockchain in comparison with the months of November and December. This reveals that bigger volumes are being carried throughout transactions.
One agency instance of the buildup that has been occurring with BTC is the variety of cash that Spot Bitcoin ETF issuers are presently shopping for. As NewsBTC reported, these issuers purchased up greater than $1 billion price of Bitcoin in a single week, amounting to over 20,000 BTC accrued.
BTC bulls push worth above $43,000 | Source: BTCUSD on Tradingview.com
BTC Heading For A Supply Shock?
Given the headwinds which are being recorded available in the market, it isn’t a far shot to say that Bitcoin might be headed for a provide shock. With tens of 1000’s of BTC being taken out of circulation, the pioneer digital asset might be headed for probably the most impactful provide shocks it has ever seen.
Now, whereas provide shocks can both be optimistic or destructive for the worth relying on the move, Bitcoin’s present trajectory factors to it being extra optimistic. Data additionally present that the active BTC supply has fallen to new record lows over the previous couple of months, suggesting a willingness amongst traders to carry reasonably than promote.
Amid all of this, as large purchase traits amongst institutional traders proceed, the obtainable supply is only going to keep falling. As this fast fall continues, the availability shock will see the worth skyrocket in response to the low availability of BTC left on the market. In this case, the worth of BTC may rise as excessive as $50,000 earlier than the availability begins redistributing as soon as extra.
