The scarcity of Bitcoin is already becoming severe to the extent that some small exchanges cannot provide customers with Bitcoin on a steady basis. An ample supply crisis is gradually happening, and it is crazy. Exchanges are running out of Bitcoin, and the demand is massive.
Bitcoin surged up over $40,000 today just briefly before dumping back to its resistance price. It has been an incredible week for bitcoin; it all started with the 28% drop, then the 33% recovery, which made up for the losses accumulated. The volatility has been astonishing; it has been an excellent market for dip buyers and a crazy marker for hoarders.
The Options market is currently pricing a 20% chance that BTC will hit $50,000 by the end of January 2021. However, this is an imperfect method of price prediction and price determination. But it will be great if Bitcoin hits $50,000 in two weeks. The good news is that the Options market is also showing a 75% chance of Bitcoin remaining above $30,000 and about a 40% chance of Bitcoin maintaining the $40,000; all options and scenarios look good, a matter of fact. The real question here is, How exactly is Bitcoin going to get to $50,000? Where will those big buyers come from?
The ongoing Bitcoin supply crisis does not look like it is going to end anytime soon. A few days ago, Grayscale started repurchasing Bitcoin. Yesterday, they bought 2,000 bitcoin, which was 2.4 times more than what was mined. It is a coincidence that it happened when the price went up. But the effects are quite evident on the market, which explains the vast price spikes we have seen lately. The market has passed the stage of absorbing such buying pressure without the prices being spiked up.
Nonetheless, this also explains why Bitcoin price doubled in under a month, and these institutions and investors are all behind it.
The supply issue is gradually hitting the small exchanges; eToro, for example, is now warning its users that crypto trading will be limited during weekends due to the surge in demand. This is excellent news; exchanges are running out of Bitcoin to sell.
Will we see $50,000 by the end of January? Anything is possible, especially at this rate, and it will be a lot beneficial to the stackers. $50,000 will be a 20% increase; if Bitcoin could go up by 30% plus in a week, 20% gain should be a piece of cake. All this is still subject to market volatility and the purchasing power of the big buyers.
