- Bitcoin struggling below USD 9,000
- As prices fall, smaller investors appear to be buying Bitcoin at what looks like bargain prices
- The Chinese Parliament has proposed a blockchain development fund
Bitcoin markets took a fall today as the bears, who did not strike on the weekend as expected, took to chomping off a few percentage points of the world’s most-traded digital asset on Monday. Price dropped as low as USD 8,645 (CoinDesk) but is currently hovering around USD 8,760.
This is the opportunity many investors have been looking for, it appears, as smaller investors and retail entrants take the chance to get in on the Bitcoin action at what looks to be bargain prices just two weeks after the reward halving event on 12 May 2020.
Today sees Bitcoin’s biggest decline since the week of Black Thursday in mid March, down over 11% from the post-halving high of USD 9,960 which was achieved on 18 May, but this is the window of opportunity for smaller holders to finally gain some exposure to crypto’s most famous asset. This is the analysis from finding that the number of unique Bitcoin wallets containing smaller amounts of BTC are slowly growing.
According to blockchain data firm Glassnode, there was a new high of 8,478,746 unique Bitcoin wallets holding a minimum of 0.01 Bitcoin — currently worth around USD 87.50 — while those holding at least ten times as much also hit a new peak at just over 3 million addresses on Friday.
Since the reward halving, both of these addresses have been in positive growth every day, leading CryptoQuant CEO Ki Young Ju to remark: “Retail investors are likely in an accumulation phase.”
Of course, the halving has been quite recent and the bullish narrative that Bitcoin’s scarcity factor can only lead to pressure pushing price up, could have some effect on retail demand, and the current dip will be seen as a rare opportunity to enter at discounted price.
All this speculation can be traced back to the last halving event in July 2016, when the asset saw prices fall back by 30% in the four weeks following that. Everyone will recall what happened shortly after August, when a rally that never stopped until the end of 2017 rampaged up the charts, wiping out any losses and breaking the previous all-time high by March 2017.
It’s not just retail investors sensing a rally coming. Singaporean crypto fund QCP Capital’s co-founder Darius Sit remarked that trading firms were also positive about the future outlook for crypto, saying that they would also buy the dip below USD 8,000:
“The price pullback was expected and the long-term bias remains bullish. We would accumulate if prices drop to the USD 6,000 – USD 8,000 range.”
Of course, it is important to note that unique wallet addresses don’t always mean there are as many individuals, since a single wallet can contain many addresses. Individuals could just as easily be storing Bitcoin in multiple addresses in a single wallet. Exchanges and custodial services do precisely the same. Ju explained:
“Wallet management systems of virtual asset service providers have become more complex and granular. Their wallet clusters include more small wallets for security, etc.”
Meanwhile, big news for blockchain in the annual sessions of the National People’s Congress (NPC), China’s parliament and Chinese People’s Political Consultative Conference. Together referred to as the “Two Sessions” or lianghui meetings, they are considered a powerful advisory body in the world’s most populous country, while NPC itself is the top legislative body.
Beijing News reports that NPC deputy Jieqing Tan, has put forward a suggestion for a blockchain development fund that, if passed, would be headed by the state. It seeks to help promising blockchain firms develop, while fostering blockchain innovation and groom blockchain unicorns in an effort to modernize China’s governance.
Tan believes that not only will China become a high-trust society of smart governance, but will then be seen as a technology lead globally, where it would then be able to better defend its national security and sovereignty.
For this, Tan says a blockchain industry development plan has to be clarified, stating:
“From the bottom technology standard, middle industry application development to the top-level system design, the national blockchain technology, industry and supervision three-dimensional strategic planning system should be well coordinated.”
China keeps making giant strides, and the pressure will only build for the US to keep up.
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