Bitcoin has exploded higher and higher in recent weeks.
However in the last five weeks the Coin rose around approximately 50%.
According to Willy Woo, capital is flowing into the Bitcoin market almost at record speed.
In particular, Woo points to the metric of the realized price, which represents the estimated cost base of the average Bitcoin investor.
Bitcoin has exploded at a higher rate in recent weeks. In the last five weeks alone, the leading crypto-currency has appreciated 50% against the US dollar, basically outperforming all other assets.
Bitcoin is currently traded for $16,200 (Buy Bitcoin now? Click here for instructions!) – well above the lows of $9,800 in September, but slightly below local highs at $16,500.
According to Willy Woo, capital is flowing into the Bitcoin market at almost record speed. The prominent on-chain analyst comments that, according to his data, there is clearly an inflow of capital into the Bitcoin market that is driving prices higher.
He points to the metric of realized price that tracks the estimated average cost base paid by Bitcoin investors. With reference to the chart below, he writes
„The realized price estimates the average price the market paid for BTC. It is now at the steepest rise in this cycle, which means that the capital inflow into #Bitcoin has reached the highest rate since the last bull market. (Higher than last year’s $4k-$14k movement; the current movement is more organic). For the sake of this comment I will define „organic“. Organic price movements take place when the BTC price is closely related to the capital of investors entering and leaving the market. If it is an inorganic BTC price, it is dominated by short-term derivative traders“.
Chart of BTC’s pricing behavior in recent years with a realized price analysis by crypto analyst Willy Woo
By far not the only good sign
The growing strength of the realized Bitcoin price is not the only good sign the analyst has seen recently. He also notes that the ongoing rally appears to have been catalyzed by large investors – suggesting that this rally is being influenced by institutional funds:
„Who bought this rally? It is smart money… High net worth individuals. You can see how the average transaction value between investors is taking a big leap up. The OTC desks can also see this. Bitcoin is still in the stealth phase of its bull run.
It is noteworthy that Woo recently stated that Bitcoin’s recent price action could be seen as declining from a technical point of view, indicating a declining RSI divergence and other unfortunate signs.
However, Woo has qualified this point, emphasizing that what really counts is the on-chain functionality – and that remains bullish for the crypto currency.