Bitcoin Price Report: Retail Investor Enthusiasm Has Returned
The latest monthly bitcoin price report from digital asset research firm Delphi Digital makes the case that retail investor enthusiasm has returned to the crypto asset market. Notably, Delphi Digital previously released a report indicating that the bottom was in for bitcoin back in early May, when the price was roughly half of what it is today. Adamant Capital had also shared a similar sentiment in April.
The latest report from Delphi Digital notes that June was bitcoin’s fifth straight month of positive returns, which is the longest streak in nearly two years. Delphi Digital’s report also echoes recent statements from Bitmex CEO Arthur Hayes and Kraken CEO Jesse Powell in terms of how bitcoin is still very much driven by retail investors. Powell’s comments were particularly of note, as they were in response to claims that the recent runup in the bitcoin price was driven by manipulation and fraud powered by the Tether stablecoin.
In terms of the new report from Delphi Digital, increased Google searches for “bitcoin” and a higher premium on Grayscale’s Bitcoin Investment Trust (GBTC) were provided as examples of retail investors’ renewed enthusiasm for bitcoin.
While Delphi Digital’s report notes that there are signs institutions are becoming more comfortable with the crypto asset market due to its vast growth potential when compared to traditional asset classes, the report adds that this is still a market driven by retail investors.
“The recent parabolic price moves have given us an eerie flashback to 2017, albeit sentiment is not nearly as dramatic,” notes the report.
Google searches for “bitcoin” are a widely-used metric for tracking the general public’s interest in the
cryptocurrency, but the Delphi Digital report also points to the increased premium on GBTC as a sign the retail investor has returned to the crypto asset market. According to a chart included in the report (see the top of this article), the GBTC premium bottomed out alongside the bitcoin price around November 2018.
“At the same time, the premium on Grayscale's Bitcoin Trust (GBTC) has crept higher since the Q4 2018 sell-off, indicating retail enthusiasm has returned, at least in part, after last year's brutal price declines. Interestingly, institutional demand for GBTC is growing as almost 75% of investments into the Bitcoin Trust in Q1 2019 came from institutional investors, according to Grayscale's Quarterly Digital Asset report,” says the report.
This latest report from Delphi Digital did not make any concrete predictions as to where the bitcoin price will go next, but the report does point out that July has historically been a positive month for bitcoin.
“In its limited history, bitcoin trends to perform well in July, averaging double digit monthly gains (+10%) with positive returns in all but one year (2014) since 2013,” says the report.
During an interview with Bloomberg on Friday,
Blockchain Capital’s Spencer Bogart explained why the sort of wild price swings seen in the bitcoin price last week are to be expected for this particular type of “store of value” asset.
In terms of the reasoning behind bitcoin’s latest price run, the finger has mostly been pointed at Facebook’s Libra cryptocurrency — even though the two digital currencies don’t have much to do with each other. Having said that, many of the individuals who were on stage at last week’s Bitcoin 2019 conference made the case that Libra could be an educational experience for the masses and lead to a number of benefits for Bitcoin.