I know many friends are asking about the reason for this decline, and are worried whether all the positive news has landed without new narratives, or whether shorting $MSTR caused #BTC to crash, and whether the bull market has ended.
Let's first discuss the unfavorable aspects:
Although yesterday's spot ETF data was not good, just missing Fidelity, based on the known data, both #BTC and #ETH spot ETFs have shown a noticeable decline, especially with BTC experiencing a large-scale reduction again. This indicates that the FOMO sentiment among American investors is beginning to cool down. In fact, this occurred once last week, and later rebounded as MSTR significantly increased its BTC holdings. Now it is again heading towards a low point.
Let's talk about the favorable data:
From the data perspective, we can see that trading volume has not shown significant shrinkage, and the market capitalization of USDC continues to rise, indicating that there are still quite a few investors entering the market. Furthermore, the amount of USDC transferred to exchanges remains high, with no obvious downward trend.
In plain language, although American ETF investors are experiencing a decreasing trend in FOMO sentiment, the amount of capital and purchasing power has not weakened.
Next, looking at BTC's own data, first, this is the data I personally value most at this stage: the stock on exchanges. In this data, we can find that the stock reached a three-year historical low on November 23. I have mentioned this data before; although it does not represent price fluctuations, it can reflect the purchasing sentiment among users. If the stock continues to decline, it indicates that buying investors are dominant, and relative selling will be lower.
As of today, we can see that although BTC's stock has slightly increased, the increase is not significant. The continuous decline has caused some investors to panic, especially short-term buyers who are worried that prices will not rise and are leaving the market. This portion of new stock coming in has not yet been consumed. This may also be one of the reasons for the price drop.
From the net flow of BTC on exchanges in the past six months, we can see that even during the recent downturn, the buying sentiment remained strong. A large amount of BTC has been continuously withdrawn from exchanges, and only from eight o'clock this morning's data do we start to see chips accumulating on the exchanges.
So based on these data, it can be inferred that the sentiment of American ETF investors is clearly beginning to enter a low point. Although this portion of capital is not enough to affect market prices, it represents that non-crypto investors are gradually withdrawing. Meanwhile, crypto investors continue to maintain FOMO sentiment; previous buyers have strong expectations for $100,000, but repeated failures to break through have caused this portion of investors to panic and reduce their holdings. This portion of investors is not small, leading to some chips still accumulating on exchanges.
Of course, although what is accumulating are chips, what is actually accumulating is sentiment. When the wind is at our back, everyone buys, and sentiment is high, so the data we see appears good. However, when the wind is against us, these data will all come down. This is also the reason why I have been reluctant to look at data recently, as the current market is controlled by sentiment. Who knows when sentiment might drop, or which news might trigger sentiment again.
However, today's main focus on the data is to determine that, although we cannot judge in the short term, there has not been a fundamental change in users in the long term, especially since December 11 (Beijing time) is Microsoft's voting day, and this result is very likely to change user sentiment again. So I still maintain my previous view of holding steady. After all, there is no obvious negative news.
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