In a recent tweet, economist and long-time Bitcoin critic Peter Schiff pointed out that Bitcoin demand currently stems from two primary sources — one being Michael Saylor-led Strategy’s aggressive Bitcoin acquisition, and the other being speculators anticipating a potential U.S. Bitcoin reserve. Schiff’s tweet comes as demand seems to be returning to markets, with Bitcoin once again surpassing $87,000.
Schiff’s statement highlights the impact of Strategy’s continuous Bitcoin accumulation, which has fueled market demand and inspired institutional interest.
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The most recent purchase, the latest in a series of almost weekly acquisitions since late October, saw Strategy acquire $584.1 million of Bitcoin after raising more than $700 million last week through the sale of its perpetual Strife preferred stock. This increased the stash of the dot-com-era-software-maker-turned-leveraged-Bitcoin-proxy to 506,137 BTC, which is about 2.4% of Bitcoin’s 21 million total supply.
Institutional interest continues to drive Bitcoin demand. Along similar lines, BlackRock, the world’s largest asset manager, is launching a Bitcoin exchange-traded product in Europe, building on the success of its $48 billion U.S. fund that tracks the cryptocurrency.
Demand returns to market
Bitcoin surged 4.25% last week to close above $86,000, and the bulls continued their rally above $88,000 at the start of this week.
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Bitcoin reached a high of $88,804 on Monday, the most it has seen in nearly two weeks. Bitcoin was up 0.05% in the last 24 hours to $87,462, after reaching intraday highs of $87,997.
Demand appears to be returning to the markets. According to the most recent CoinShares report, Bitcoin investment products saw inflows of $724 million last week, following five weeks of outflows.
Bitcoin’s relief rally is expected to face stiff resistance at the 50-day SMA at $89,994. If surpassed, that increases the chances of a rally to $95,000 and then to $100,000. Conversely, if the price turns down from current levels, support is expected at the daily SMA 200 at $85,221 and near $83,000. A drop below $83,000 could sink the Bitcoin price to $80,000.
