Daily Bitcoin Summary
Monday, February 15, 2021 - Over the past 24 hours the price of Bitcoin balanced between $46.2K and $48.7K. Morgan Stanley is continuing to hype up Bitcoin. Gold and Silver continue to be outpaced by Bitcoin. The derivatives market is showing strong signs of influencing the price of Bitcoin upwards.
Top Tweets
Morgan Stanley is making *serious* claims about bitcoin - Whether they are right or wrong about BTC as a medium of exchange, the positive support from Morgan Stanley shows they are likely dipping their toes in the game. When investment firms begin hyping bitcoin, it usually means they are either about to purchase or are in the process of purchasing BTC - similar to what we saw with MicroStrategy, Tesla, Square, and PayPal.
Bitcoin continues to outperform gold
Bitcoin market cap is catching up with silver market cap
Deep Tweets
Renowned value investor and Bitcoiner, Preston Pysh, is calling out a correlation between the derivatives market (i.e. futures, options, etc. trading) and the rising price of bitcoin. Essentially, futures traders are purchasing and locking up bitcoin so that then sell a futures contract to earn a 5%-20% spread. Currently $17B worth bitcoin is locked up in the derivatives market according to PlanB. Spreads remaining conistent, as more traders catch on to this opportunities we should expect more bitcoin to come off the market and the price to continue going up.
Why is this a big deal? Future spreads in mature assets like bonds are tiny in comparison, less than 1.2%. The derivatives market is $1.4 quadrillion (fourteen hundred trillion) in size. So, we should expect a lot of that money to begin to move from traditional futures assets over to bitcoin to capture the 5%-20% spread.
In this graph you can see the futures open interest correlating to the price of bitcoin.
In this graph you can see bitcoin coming off the exchanges potentially for futures traders to make their spreads. Link to go deeper down the bitcoin to futures market rabbit hole.
Enjoy the evening and here’s to a great tomorrow.
Cheers,
Bitcoin Daily