GB Market Commentary 03/03/2022
by Marcus Sotiriou
Bitcoin has stalled around $43-$44k whilst on-chain metrics suggests that the accumulation phase has begun. Accumulation phases precede bull markets, whilst distribution phases precede bear markets. Analysis from CryptoQuant shows how the market cap for 6 month old Bitcoin was 13% at the cycle top, whereas it is now 52%. A larger proportion of investors are becoming long-term holders is beneficial for price appreciation, as it is clear that more investors are seeking higher prices to sell.
Crypto adoption globally continues to soar and aligns with the thesis that we are in an accumulation phase. Ebay’s CEO hinted this week that they will soon integrate crypto payments, as they aim to capture GenZ and millennial audiences. This comes after the firm enabled NFT trading last year on its platform. Integrating crypto would be a great step for mainstream adoption, as eBay have around 160 million active buyers worldwide as of Q2 2021.
Furthermore, the multinational financial services giant Charles Schwab has filed with the SEC to launch a Crypto Economy ETF. This ETF will invest at least 80% of its net assets into the stocks listed on the Schwab Crypto Economy Index from companies that utilise Bitcoin and other digital assets. This move is in response to significant client demand – last week the Head of Investor Services said that 1 in 6 clients expressed interest in investing in crypto in the first half of the year. This is compelling as the company serves 33.3 million accounts and is one of the biggest banks in America.