We are likely to test the ATH of $ 19783 soon I found myself asking what is different than before. In short, a lot, but I would like to hear other thoughts. 'Chainalysis Team' published this report that has some interesting prospective I haven't considered/realized. https://blog.chainalysis.com/reports/bitcoin-price-surge-explained-2020
Are their points valid or hogwash? To summarize they boil it down to demand vs liquidity (yeah that bit is obvious), but they characterize the differences in demand namely big name institutional investment. Again widely discussed in this forum but this chart is slick if the underlying data is valid:
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Right now, the amount of liquid Bitcoin is similar to what it was during the 2017 bull run. But the amount held in illiquid wallets is much higher, currently representing 77% of the 14.8 million Bitcoin mined that isn’t categorized as lost, meaning it hasn’t moved from its current address in five years or longer. That leaves a pool of just 3.4 million Bitcoin readily available to buyers as demand increases.
They also highlight an large inflows to exchanges primarily serving North America:
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North American exchanges were losing Bitcoin on net in the early part of the 2017 bull run, and became a net receiver as price began to peak. This time around though, North American exchanges have been in the green throughout, with inflows ramping up to higher levels than at any point in the 2017 run in the last few months.
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Similarly, we also see much higher net inflows to exchanges allowing crypto-to-fiat (C2F) trades compared to 2017. C2F exchanges are playing a bigger role in this surge than in 2017, when crypto-to-crypto (C2C) exchanges, used mostly by traders swapping many different types of cryptocurrency, drove more of the market. This, combined with the accumulation of Bitcoin by investor wallets that tend to hold for long periods of time, suggests that first-time Bitcoin buyers and buyers looking to unload fiat currency for Bitcoin as a hedge against worrisome macroeconomic trends are responsible for much of the current demand.
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This is good news for cryptocurrency
While we can’t know if prices will continue to rise, the current Bitcoin surge portends good things for cryptocurrency — not just because prices are rising, but because of why they’re rising. A comparison of this bull run to that of 2017 suggests that investors have become savvier and more strategic, buying Bitcoin to fulfill a specific use case rather than to speculate on the new hot asset. If Bitcoin can continue to be an effective hedge against macroeconomic trends, we believe more and more institutional investors will put money into the asset, leading to even more mainstream adoption.
While we can’t know if prices will continue to rise, the current Bitcoin surge portends good things for cryptocurrency — not just because prices are rising, but because of why they’re rising. A comparison of this bull run to that of 2017 suggests that investors have become savvier and more strategic, buying Bitcoin to fulfill a specific use case rather than to speculate on the new hot asset. If Bitcoin can continue to be an effective hedge against macroeconomic trends, we believe more and more institutional investors will put money into the asset, leading to even more mainstream adoption.