Today I bring you the insights from an opinion piece by Julius Baer digital assets analyst Manuel Villegas, who has somewhat contextualized the recent pause in Bitcoin price action with the pause in which BTC ETFs have entered.
It is to manifest that, Villegas has highlighted that spot bitcoin ETFs, in his view the fundamental drivers of the markets since the beginning of the year, finally took a breather when the five-day streak of continuous outflows came to a halt on Monday.
To wit, the analyst noted that although ETF net flows were still below $20 million on Monday, the market reacted quickly, improving sentiment and reversing last week's sell-off with bitcoin prices back above $70,000.
On the other hand, Villegas also highlighted that perpetual futures, often referred to as perps, are of key importance in the cryptocurrency markets, as they provide market participants with a forward contract that has no expiration date; becoming the basis for trendy cash and carry floating rate trades.
Villegas concluded his outlook by stating that, "Demand for spot ETFs, a limited supply schedule, a bitcoin halving that will likely bring more supply constraints, and net liquidity in the U.S. that has continued to increase."
SOURCES CONSULTED
Cointelegraph. According to one analyst, spot bitcoin ETFs "took a breather." Link
OBSERVATION:
The cover image does not belong to the author: @lupafilotaxia, the image was taken from: Reuters
